U.S. proposes ban on Chinese auto parts so cars 'can't be used against us'

Caption

A worker wipes a Rising F7 car model at a floor section selling various Chinese-made electric car brands inside a shopping mall in Beijing, Tuesday, April 4, 2023. (AP Photo/Andy Wong) / AP

The U.S. Commerce Department proposed Monday a national security ban on certain Chinese and Russian-made car parts from U.S. roads starting in 2027. The proposed rule comes after President Biden ordered an investigation in February into whether Chinese vehicles pose a national security risk.

If enacted, the ban would focus on hardware and software that connects vehicles to the outside world — such as Bluetooth and satellite modules — and driverless systems.

"We've already seen ample evidence of [China] pre-positioning malware on a critical infrastructure for the purpose of disruption and sabotage," Jake Sullivan, the national security adviser, said on a call with reporters. "And with potentially millions of vehicles on the road, each with 10- to 15-year life spans, the risk of disruption and sabotage increases dramatically."

Earlier this year, FBI Director Christopher Wray warned Congress that China was targeting American water treatment plants, pipelines and power grids.

Beyond national security, Sullivan said the ban would give U.S. drivers added personal security. With cars collecting geolocation, audio and video data — Chinese and Russian software and hardware can't be trusted, Sullivan said.

U.S. Secretary of Commerce Gina Raimondo called the proposed ban — issued by her department's Bureau of Industry and Security team — a "proactive" step since there are currently "very few Chinese cars" on U.S. roads.

In 2023, 104,000 Chinese-made cars were sold in the U.S. — a 45% increase from the year before — according to Business Insider.

"We'll secure our cars and we'll secure the American people, including our children, from potential surveillance, remote access and control, and protecting Americans from bad actors and trying to give every American peace of mind," Raimondo said on the call.

Raimondo also pointed to Europe as a "cautionary tale." Nearly 500,000 Chinese-made cars are driven on European roads, according to a report from Jato Dynamics, which studies the industry. And this summer, in a separate report, Jato said Chinese automakers overtook their U.S. rivals in overall sales, selling 13.4 million to America's 11.9 million vehicles.

Despite the economic impact this proposed rule would have, Raimondo said it wasn't a driving force.

"This is not about trade or or economic advantage," Raimondo said. "This is a strictly national security action."

Yet, Lael Brainard, Biden's national economic adviser, highlighted the economic impact this rule would have on American workers.

"The Biden-Harris administration believes the future of the auto industry is made in America by American workers, and today's announcement ensures that Americans can drive the car of their choice safely and securely free from risks posed by Chinese technology," Brainard said.

In May, Biden levied a 100% tariff on Chinese electric vehicles.

"I'm determined that the future of electric vehicles be made in America by union workers. Period," Biden said.

The Commerce Department will give the public 30 days to comment on the rule before finalizing it. It then plans to start banning Chinese and Russian car software during the 2027 model year. The prohibition on hardware would start in 2029.

"Our plan is to get that final rule out before the end of this administration," a senior administration official said on the call. "So, hopefully, we will achieve that."