Polestar shut out of US market from 2027 as China tech ban claims Geely-linked brand

The US Commerce Department has denied Polestar authorisation to sell vehicles in the United States from model year 2027, the first concrete application of the Connected Vehicle Rule against a brand with Chinese-linked technology supply chains.

The rule, finalised in January 2025 and effective from March 2025, targets vehicles with software or hardware tied to China or Russia. It covers telematics systems, cameras, microphones, and GPS units. Bluetooth modules and cellular modules also fall under it, along with automated driving software. The rule applies regardless of where a vehicle is assembled. Polestar operates a $1.3 billion plant in Ridgeville, South Carolina, where the Polestar 3 is built on the same line as Volvo models. The Polestar 4 is assembled in Busan, South Korea. Neither arrangement changed the outcome.

Geely owns both Polestar and Volvo. Volvo received a government exemption roughly a month before the Polestar denial was confirmed. The split outcome shows US regulators assessing technology supply chains company by company rather than applying a blanket rule based on ownership structure. Polestar had warned its US dealer network of the likely denial as early as 2024.

Hardware restrictions under the same rule will extend to vehicle connectivity system components from model year 2030. That means additional brands with Chinese-linked hardware in their supply chains face similar scrutiny in the years ahead.