Polestar faces a major setback in the American market. The US Department of Commerce's Bureau of Industry and Security will block the brand from selling new vehicles starting in 2027, citing the Connected Vehicle Rule. This regulation prohibits cars containing software or hardware from China or Russia due to national security concerns.

Even the domestically produced Polestar 3 SUV won't escape these restrictions. Despite moving assembly to South Carolina in 2024 to avoid Chinese EV tariffs, the company's majority ownership by Geely has prevented it from securing necessary authorization. The timing creates particular pressure since customer deliveries only began last year.

Interestingly, Volvo received approval for US sales despite sharing the same Chinese parent company. This distinction suggests the regulatory framework may differentiate between brands rather than applying blanket restrictions based solely on ownership. The decision leaves Polestar's US manufacturing strategy in limbo.

Polestar must now decide whether to continue South Carolina production or relocate elsewhere. The ruling demonstrates how geopolitical tensions increasingly complicate automotive supply chains, even affecting vehicles assembled on American soil.