Story perspectives

US Blocks Polestar 3/4 Sales, Firm Shifts Focus to Europe

6/26/2026

Summary

Polestar Shifts Focus

The U.S. Department of Commerce denied Polestar authorization, banning Polestar 3 and 4 sales in United States from 2027.
Polestar will keep selling its existing inventory in United States and support customers.
CEO Michael Lohscheller said the firm will focus on Europe, which provides 80% of its sales and 94% of Q1 2026 sales outside the U.S., while the U.S. accounted for only 6% of Q1 2026 retail sales.

Summary

Polestar Shares Plummet

Polestar shares fell 5.7% to $19.22, a 96% decline from November 2021 peak of $459.90, after a reverse stock split kept it on Nasdaq.
Automaker relies on capital injections from Geely and chairman Li Shufu to stay afloat.
U.S. legislators have introduced bills to tighten the Connected Vehicle Rule, potentially barring Chinese production in the United States.
CEO Lohscheller said the industry is fragmenting and Polestar will build the Polestar 7 in Slovakia.

Summary

U.S. Rule Bars

The Connected Vehicle Rule bars sales of passenger cars up to 4.5 tonnes if the maker or security-software supplier is China- or Russia-controlled.
From 2030 the rule also restricts vehicle hardware.
The regulation bans Chinese manufacturers from testing automated vehicles on U.S. roads, covering all brands.
Volvo received an exemption and Polestar’s request was denied without explanation.
The rule complements U.S. tariffs by targeting vehicle technologies rather than finished cars.

History

Historical Context

After the U.S. added Huawei and 70 of its affiliates to the Commerce Department’s Entity List on 15 May 2019—following the Aug 2018 NDAA ban on Huawei gear—the government has repeatedly used security-driven export rules. The 2022 Connected Vehicle Rule now blocks Polestar’s software request, echoing the earlier Huawei restriction and showing how U.S. trade policy reshapes supply chains.

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Polestar Shifts Focus

The U.S. Department of Commerce denied Polestar authorization, banning Polestar 3 and 4 sales in United States from 2027.
Polestar will keep selling its existing inventory in United States and support customers.
CEO Michael Lohscheller said the firm will focus on Europe, which provides 80% of its sales and 94% of Q1 2026 sales outside the U.S., while the U.S. accounted for only 6% of Q1 2026 retail sales.

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