Polestar will not fight US ban

It looks like Polestar is officially leaving the US market. According to a new report from wall street journalThe Chinese-backed automaker will not challenge the US government’s decision to halt future sales of its vehicles.

The decision effectively ends the Swedish EV maker’s presence in one of the world’s largest auto markets. Pollstar says it will focus its attention elsewhere instead of appealing the Commerce Department’s decision or taking legal action.

Polestar spokesman Michael Ofiara said, “We will instead focus our investments on markets where we have a strong brand position and the ability to achieve profitable growth, with an ongoing focus on Europe.” WSJ.

Ofiara said the company had had “significant conversations” with US authorities and concluded that the appeal was unlikely to succeed. Motor1 has contacted Polestar for an official statement.

Why was Polestar banned?

The Commerce Department’s decision to ban Polestar in the US stems from new connected-vehicle safety rules. Those rules ban Chinese software in internet-connected vehicles starting in the 2027 model year.

US officials argued that cameras, GPS systems and other connected technologies could pose a national security risk if controlled by foreign adversaries. Polestar, which is majority-owned by China’s Zhejiang Geely Holding Group, said it was denied a special authorization that would have allowed it to continue selling vehicles despite the new rules.

Volvo, majority-owned by Geely, received the approval earlier this year after demonstrating how it handles vehicle data and cybersecurity. The Commerce Department has declined to explain why the two companies got different results.

Ironically, Polestar no longer sells China-made vehicles in the United States. The Polestar 2 left the market after tariffs on Chinese-made EVs were implemented, while the Polestar 3 is built in South Carolina alongside the Volvo EX90 (which is sold in the US). The new Polestar 4 is made in South Korea.

The move could also hurt existing owners, with Polestar’s departure likely to have a huge impact on resale values, especially now that the company is clearing out remaining inventory and reportedly offering discounts of up to $25,000.

Motor1’s Opinion: Polestar’s exit is big, not just because the company was a major sales player, but because it raises questions about how the US is enforcing its new connected-car safety rules. Polestar and Volvo share ownership, engineering and even production facilities, yet one brand got the nod while the other was shut down.