Electric car manufacturer Polestar, born in Sweden but controlled by Chinese group Geely, stated that the Donald Trump administration is forcing it to stop selling new vehicles in the United States starting with the 2027 model year. The decision came after the U.S. Department of Commerce did not authorize the automaker to operate under the so-called «connected vehicle rule,» a regulation that restricts the import and sale of cars with certain technologies linked to China.
The scope of the measure is sensitive for the industry because it is not limited to where a car is built. The rule targets vehicles that incorporate software or connectivity technologies developed by companies with Chinese ties. It includes systems such as Bluetooth, Wi-Fi, cellular connectivity, and some satellite communications, under the argument that these vehicles could collect sensitive data from U.S. users.
The regulation was first adopted in January 2025, during Joe Biden’s presidency, and remains in effect under the Trump administration. In practice, it represents another chapter of Washington’s pressure on the entry of Chinese vehicles and on brands with industrial or equity ties to China.
Although Polestar is headquartered in Sweden, its majority shareholder is Geely Holding, the Chinese group that also controls Volvo. That ownership structure was one of the reasons the company needed specific authorization to continue selling in the U.S. market.
The automaker stated that it will continue selling available units of the Polestar 3 and Polestar 4 that are already in the United States and assured that it will maintain access to its service network for current owners, with support for spare parts, warranty, and maintenance.
Despite this, the measure raises questions about the commercial future of the Polestar 3, the only model produced in the United States. Volvo announced in March that it would consolidate its manufacturing at the South Carolina plant, instead of also producing it in Chengdu, China. But a Volvo spokesperson clarified that production in China has not yet stopped and that it was still too early to know whether the regulatory decision will modify those plans.
The case also exposes a striking difference within the same corporate group. Volvo, sister brand and co-founder of Polestar, reported in May that it had received authorization to continue selling vehicles in the United States, although it still must adapt its entire lineup to the rule’s specifications. It is unclear why Volvo obtained approval and Polestar did not, given that both brands belong to Geely and share components, platforms, and software in some models.
One example is the link between the Polestar 3 and the Volvo EX90, where both use a similar architecture, have close software packages, and are built at the same plant in South Carolina. Despite that, the Volvo EX90 will be able to continue being offered as a 2027 model year in the United States, while the Polestar 3 was affected by the Commerce Department’s denial.
For Polestar, the loss of the U.S. market is a blow, although it does not necessarily alter the core of its business. Only 6% of its first-quarter 2026 sales came from the United States, compared to 78% in Europe. The brand had increasingly oriented its activity toward Europe, while facing slow sales in the United States, greater competitive pressure, and weaker consumption. Additionally, Polestar struggled to achieve profitability and needed repeated capital injections from Geely.
The U.S. rule could have broader effects in the coming years. While the current restriction focuses on software and connectivity technologies associated with China starting with the 2027 model year, the scope is expected to extend to hardware components manufactured in China or by companies with Chinese ties starting with the 2030 model year. That point is relevant because many manufacturers use onboard computers, electronic components, or technological developments from China. Therefore, the Polestar case may foreshadow new tensions for other automakers that, even without selling cars made in China, depend on increasingly intertwined global supply chains.
Para mí esto es un papelón de Trump, un desastre total. Polestar era lo más cancherito y este yanqui paranoico anti-China nos deja sin autos. Mamita, son unos vendepatria que defienden a los burgueses de Detroit mientras joden a la industria popular. ¡Viva la izquierda y la cooperación global, che!
Para mí esto es clarísimo: Trump tiene razón en rajar a Polestar. La tecnología china es un peligro, no me jodan. Que se vayan a vender sus autitos comunistas a otro lado. Viva USA y el proteccionismo, los zurdos lloran pero el empleo yanqui primero. Firme, El Patriota.