The Biden administration has proposed new rules to prevent the “sale or import” of connected car software from “problem countries.” This would effectively ban all car imports from China in the United States.
Vehicles with hardware and software from China pose an “acute” threat to US national security, the White House said in a statement. This includes the potential for “sabotage and surveillance, such as remotely disabling a vehicle in the middle of the road.”
The rules would cover everything that connects a vehicle to the outside world, such as Bluetooth, Wi-Fi, cellular and satellite components. They also address concerns that technologies such as cameras, sensors and onboard computers could be misused by foreign attackers to collect sensitive data about U.S. citizens and infrastructure.
Vehicles with hardware and software from China pose an “acute” threat to US national security
The rules follow an investigation the Commerce Department launched earlier this year into connected vehicle software made in China and other countries considered hostile to the U.S. The rules would force American automakers and suppliers to remove Chinese-made software and hardware from their vehicles in the coming years.
Earlier this month, the Biden administration imposed new tariffs on Chinese imports, including a 100 percent tariff on electric vehicles and new price increases on Chinese-made batteries and key minerals.
The proposal was the latest tightening of existing trade restrictions on Chinese-made light commercial vehicles and components such as computers and batteries. And it comes at a time when China is producing more cars than ever before, earning itself the status of the world's largest auto exporter.
China in particular has cracked the code on low-cost, highly affordable electric cars, while U.S. and European manufacturers continue to struggle to bring their own models to market. The BYD Seagull, for example, was the country's best-selling car in August, with a range of about 189 miles and a list price of around $10,000. Even with a 100 percent tariff, the Seagull would still sell for a much cheaper price than most domestically produced electric cars.
China has cracked the code for low-cost, highly affordable electric vehicles
US authorities have expressed concern that China's export of electric vehicles to the country would ruin domestic manufacturers – a view shared by auto executives. Tesla CEO Elon Musk said China would “destroy” the US auto industry without trade barriers – but later walked back his statement and said he opposed tariffs.
China had previously accused the United States of repeatedly abusing the “concept of national security” to wrongfully target Chinese companies and hinder competition in global markets.
Under the proposed rules, the software ban would take effect for the 2027 model year, while the hardware ban would take effect for the 2030 model year.
The new rules could mirror similar provisions in the federal electric car tax credits that prohibit the credit from applying to vehicles with battery components made in China. The administration has also proposed high tariffs on Chinese vehicles to make them too expensive to sell in the U.S.
The Autonomous Vehicle Industry Association, which represents automakers and technology companies working on self-driving cars, praised the Biden administration for this stance.
“America's national security is fundamental,” said Jeff Farrah, the group's CEO, in a statement. “The autonomous vehicle industry has worked constructively with federal agencies and stakeholders to provide important information about connected vehicles and how the AV industry helps ensure national security.”