On Monday, due to national security concerns, the US Commerce Department proposed prohibiting essential Chinese software and hardware in connected vehicles on American roads. This move would effectively ban Chinese cars and trucks from the US market.
The planned regulation, first reported by Reuters, would also force American and other major automakers to remove critical Chinese software and hardware from vehicles in the United States in the years ahead.
Earlier, the Biden administration had already inflicted a 100% surtax on Chinese EVs imported into the US. That rule will come into effect on September 27th.
Potential manipulation
President Joe Biden’s administration has raised concerns about data collection by connected Chinese vehicles on US drivers and infrastructure and potential foreign manipulation of cars connected to the internet and navigation systems. In February, the White House ordered an investigation.
The proposed prohibitions would prevent Chinese automakers from testing self-driving cars on US roads. They would also apply to vehicle software and hardware produced by Russia and could be extended to other US adversaries.
The proposal would make software prohibitions effective in the 2027 model year. The hardware ban would take effect in the 2030 model year or January 2029.
The Commerce Department is giving the public 30 days to comment on the proposal and hopes to finalize it by January 20th. The rules would cover all on-road vehicles but exclude agricultural or mining vehicles not used on public roads, drones, and trains.
Active ban
There are few Chinese-made cars or light-duty trucks imported into the US yet. The department is acting “before suppliers, automakers, and car components linked to China or Russia become commonplace and widespread… We won’t wait until our roads are filled with cars, and the risk is extremely significant.”
Nearly all newer cars and trucks are considered ‘connected’, with onboard network hardware for internet access, allowing data sharing with devices inside and outside the vehicle. The Commerce Department said the rule would ban all vehicles manufactured in China but would allow Chinese automakers to seek ‘specific authorizations’ for exemptions.
“We anticipate at this point that any vehicle manufactured in China and sold in the US would fall within the prohibitions,” said Liz Cannon, who heads the Commerce Department’s information and communications technology office. She added the regulation would force General Motors and Ford Motor to stop selling vehicles imported from China in the US.
The Biden administration has also restricted the possibility of exporting specific technological products to China, especially semiconductors and the tools to make them. Government officials said Chinese companies’ access to top technology, eventually used in military applications, has to be seriously limited.
Risk of disruption and sabotage
White House National Security Adviser Jake Sullivan declared that the US has ample evidence of China prepositioning malware in critical American infrastructure. “With potentially millions of vehicles on the road, each with 10- to 15-year lifespans, the risk of disruption and sabotage increases dramatically,” Sullivan said.
“The access to these systems would allow possible enemies to collect sensitive data and manipulate vehicles on American roads,” the security office at the Ministry added.
Chinese Foreign Ministry Spokesperson Lin Jian said China urges Washington “to respect market principles and provide Chinese companies with an open, fair, transparent, and non-discriminatory business environment. China will firmly safeguard its legitimate rights and interests.”
Chinese authorities are also trying to prevent foreign carmakers from testing their software for autonomous driving in China. They only admit restricted licenses, often limited to certain cities. American car manufacturer Tesla has been suffering from these regulations and restrictions.
The Alliance For Automotive Innovation, a group representing major automakers including GM, Toyota, Volkswagen, and Hyundai, said some automakers may need more time to comply.
The group said “very little” connected vehicle hardware or software is entering the US from China. However, this rule will sometimes require auto manufacturers to find alternate suppliers.
A car manufacturer like Volvo, which sells almost one-fifth of its production in the US, is owned by the Chinese Geely holding and shares much technology with sister brands like Polestar and Zeekr. That could become a severe problem in the US.
Comments
Ready to join the conversation?
You must be an active subscriber to leave a comment.
Subscribe Today