Polestar to exit US market due to Connected Vehicle Rule that bans connected tech linked to China, Russia

Polestar announced yesterday (June 25, 2026) that it will stop selling cars in the United States after the 2027 model year. This comes after the Bureau of Industry and Security (BIS), which is an agency of the US department of commerce, decided not to grant Polestar an authorisation under the Connected Vehicle Rule.

First introduced when Joe Biden was president previously and enforced under the current Donald Trump administration, the Connected Vehicle Rule bans the import and sale of vehicles using connected hardware and software linked to China or Russia. The justification, as you’d expect, is due to national security risk regarding data collection.

Geely owns majority stakes in both Polestar and Volvo, and while the former failed to receive authorisation from the BIS, the same did not happen for the latter, which was granted an exemption in May this year.

In its release, Polestar said it will continue to sell its existing stock of the 3 and 4, while also supporting current owners after its departure. Upcoming models like the 5 and 6 that were previously announced will not be sold in the US under this new ruling.

It added that it will focus more heavily on Europe, which accounted for 80% of its global sales. In fact, the brand pointed out that 94% of sales in the first quarter of this year originated from markets outside the US.

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