When the federal government decided last month to ban electric-vehicle maker Polestar from selling future models in the U.S., the majority-Chinese-owned company wasn't completely out of options. Polestar had a path to ask the U.S. Commerce Department to reconsider, or it could have eventually taken the matter to court. Instead, Polestar is taking the exit ramp out of the U.S.—and American dealers and customers say they are left holding the bag.

A spokesman for Polestar confirmed that the brand will not appeal the ban, which was issued over national-security concerns. "We will instead focus our investments on markets where we have a strong brand position and ability to achieve profitable growth, with a strong weighting towards Europe," Polestar spokesman Michael Ofiara said. He added that the company had "significant dialogue" with U.S.** authorities and didn't believe an appeal would have succeeded.