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Ban on Chinese tech so broad, US-made cars would be blocked, Polestar says

Polestar says its decision-makers are in Sweden, and the company is listed on the NASDAQ.

Jonathan M. Gitlin – | 268
A Polestar 2 EV parked in front of a bank of Tesla Superchargers
Credit: Polestar
Credit: Polestar
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Today, Polestar electric vehicles gained access to the Tesla Supercharger network. That means US Polestar drivers have access to 17,800 more DC fast chargers than they did yesterday—once they get a NACS adapter, which can also be ordered today from their local Polestar service point. But right now, Polestar has bigger worries than expanding its charging options. Should proposed new rules banning Chinese connected-car software and hardware go into effect, they would effectively ban the automaker from the US market, the company says, including the EVs it builds in South Carolina.

The rule would ban Chinese connected-car software from US roads from model-year 2027 (midway through 2026) and Chinese connected car hardware from model-year 2030.

The ban on Chinese connected-car technology is the latest in a series of protectionist moves from the federal government and Congress. The revamped clean vehicle tax credit no longer applies to EVs made in China or with Chinese components in their battery packs, and the US Commerce Department has been pressuring Mexico to not offer generous incentives to Chinese automakers looking to set up shop nearby. Chinese-made EVs have also been subject to a 100 percent tariff since May.

China’s domestic car market has been in decline for some months now, and the Chinese government has for years been heavily subsidizing its auto industry’s exports as a way to undermine foreign competition in areas like green tech. Cheap Chinese EVs have already started gaining a foothold in Europe, and the European Union is set to impose 35.5 percent tariffs on Chinese-made EVs over the opposition of many European automakers, which fear retaliation.

Polestar has more than a few issues with the proposed rule, according to its public comment. For one, the definition is too broad and “creates crippling uncertainty for businesses.” A better-defined list would be helpful here, it says.

Polestar also says that “if a large portion of manufacturing or software development is occurring outside of the country of a foreign adversary, mere ownership should not be the determinative factor for applying the various prohibitions within the Proposed Rule.” Polestar is a US-organized company and a subsidiary of a UK publicly limited company that is listed on the NASDAQ exchange in New York. Its HQ is in Sweden, and seven out of 10 board members are from Europe or the USA. It builds Polestar 3 SUVs in South Carolina and will build the Polestar 4 in South Korea from next year. In fact, out of 2,800 employees, only 280 are based in China, Polestar says.

With the company’s “key decision-makers” being in Sweden, there is little reason to believe the national security concerns apply here, the company says, saying that the US Commerce Department should consider whether it has gone too far.

Polestar may be the most affected automaker by the new rule, but it is not the only one. Last month, the Commerce Department told Ford and General Motors that imports of the Lincoln Nautilus and Buick Envision—both of which are made in China—would also have to cease under the new rule.

Photo of Jonathan M. Gitlin
Jonathan M. Gitlin Automotive Editor
Jonathan is the Automotive Editor at Ars Technica. He has a BSc and PhD in Pharmacology. In 2014 he decided to indulge his lifelong passion for the car by leaving the National Human Genome Research Institute and launching Ars Technica's automotive coverage. He lives in Washington, DC.
268 Comments
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LordSlinkySupreme
LordSlinkySupreme
The whole car.

Polestar, although it is listed on the NASDAQ, only has a small minority of shares for public sale.
Polestar is effectively a subunit of geely, a major chinese automaker. Its vehicles all use geely platforms and technology.
It has the lions's share of ownership via Volvo, which is about 80% geely owned. Another sizable minority is owned by a chinese investor/investment group. About 80% of Polestar, therefore, is controlled by chinese investors.

Although it may be listed on the NASDAQ, and although the "decision makers" (who can be trivially fired if the real decision makers -- Geely via Volvo and this other chinese investor) are in sweden, the nuts and bolts is that these are all fundamentally chinese cars. Everything they are saying is a charade. These are chinese cars.
Not to be pedantic, but Volvo offloaded most of its shares in Polestar; Geely still owns around 70% or so last I checked, so the majority of the company is in fact controlled by a Chinese holding company.

But does ownership define citizenship? When Ford owned Volvo, did the cars become American? 30% of Aston Martin is owned by a Canadian billionaire; does that mean AM is not English anymore? The Saudis own the majority of shares in Lucid, so does that make the Air and Gravity Saudi cars?

Polestar does its R&D in Sweden and England. Its leadership team is Swedish and German. In the EU and USA, its software is provided by Google. Geely provides funding and the platforms shared between Polestar, Volvo and Lotus, and the P3 and P4 will be made in South Carolina and South Korea respectively for the US market.

I honestly don't have an answer, but saying they're "fundamentally Chinese cars" when the vast majority of the work designing them and manufacturing them is being done outside of China seems reductive.
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