When the Law Kills Your Electric Car Dealer

Having a US Selling electric cars has been difficult in the 2020s.

Since Polestar Short Hills opened in northern New Jersey in 2021, it has passed Covid-time want to spike and EV deficiency who left others the electricity used is high cost more than new; the new one federal tax credit up to $7,500 which brought a new wave of drivers in the door; reduce sales after refund about the federal tax creditand shooting the government; then another wave to buy when EV-interested drivers began to run Elon Musk’s Tesla because of the CEO’s actions and The Trump administration.

Now, Matthew Haiken, who owns that Polestar dealership along with three other (non-Polestar) dealerships in the Prestige Collection Auto Group, is facing another and even bigger challenge. Polestar said at the end of June that the US Department of Commerce denied a permit that would have allowed the brand to continue selling cars in the US despite federal law prohibiting the sale of cars with China’s connected car technology. The company, which is owned by China’s Geely Holding and founder Li Shufu, has said it will stop selling Polestar cars in the US starting in 2027.

“It’s very sad,” says Haiken. “It’s hard for my clients who have been reaching out; it’s hard for my employees.” He said he and the other owners of the 31 US Polestar dealerships had invested “multiple millions” in selling the cars and called the approval “a surprise to me and all the dealerships.”

Volvo, which is also majority owned by Geely, received approval from the Commerce Department in March, allowing it to continue selling its cars in the US, despite its ties to China. Volvo said at the time that it held “proactive discussions” with the department regarding the automaker’s “governance, technology and data security.” (When asked about the discrepancy, a Polestar spokesperson said the company “cannot comment on how the rules apply to other manufacturers.”)

“I’m very disappointed in Polestar, in the whole world,” said Haiken. “I think they really dropped the ball, and I blame them.

The Commerce Department under the Biden Administration officially approved the connected car law in January 2025, after federal officials. argued that the ban on Chinese and Russian-made car parts and software were important for national security reasons. The government says that Internet-connected car cameras, microphones, and GPS devices pose a threat to US national security. “It doesn’t take much imagination to understand how a foreign adversary who gains access to this information could threaten our national security and the privacy of US citizens,” Commerce Secretary Gina Raimondo said at the time.

The US Commerce Department did not respond to WIRED’s inquiries.

Polestar said in a statement last week that US dealers will sell “available stock” of the Polestar 3 and Polestar 4and that US networks “will continue to support customers.” It framed the move as “expanding its focus in Europe,” and said 94 percent of Polestar’s sales in the first quarter of 2026 were made outside the US.

Haiken says these numbers are misleading because the newest offering, the Polestar 4 coupe, went on sale in Europe in January 2024 but won’t be available in the US until December 2025.

Some Polestar dealers handle service issues through Volvo centers, but Haiken said his independent Polestar centers will continue to service and deliver EVs. “We have the power to justify ourselves,” he says. “We have to be here to do this work.” Not all dealers will make the same decision, he said, even if the vehicles are sent to a local service center for repair and maintenance.