U.S. Plans Restrictions On Chinese Car Software

"A car is a very scary thing,” a senior U.S. Commerce Department official said. "It knows a lot about you."

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Tim Levin

By: Tim Levin

Jul 17, 2024 at 3:30pm ET

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The U.S. Department of Commerce plans to issue new restrictions on Chinese vehicle software in August, Reuters reported on Tuesday.

The rules reflect the Biden administration’s toughening stance on China’s auto industry, which has emerged in recent years as a global powerhouse in electric vehicle and battery manufacturing. In May, the U.S. announced new 100% tariffs on Chinese electric cars in the hopes of protecting domestic automakers from a deluge of inexpensive (and, importantly, high quality) imports.

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Biden's crackdown on Chinese cars

The White House announced 100% tariffs on Chinese-made electric cars in May. Restrictions on Chinese-made car software is on the way. The EV tax credit excludes models with certain components linked to China.

But as vehicles become increasingly like smartphones on wheels, the physical cars themselves are just part of the picture. Now the U.S. is taking a hard look at the national security risks posed by Chinese software.

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"We're looking at a few components and some software—not the whole car—but it would be some of the key driver components of the vehicle that manage the software and manage the data around that car that would have to be made in an allied country," Alan Estevez, the Under Secretary of Commerce for Industry and Security, said Tuesday at a forum in Colorado, per Reuters.

Estevez sounded the alarm about the treasure trove of sensitive data that modern, internet-connected cars can collect about their owners.

"A car is a very scary thing,” he said, per Reuters. "A modern car has a lot of software in it. It's taking lots of pictures. It has a drive system. It's connected to your phone. It knows who you call. It knows where you go. It knows a lot about you."

The restrictions would come as a result of a Commerce Department inquiry launched in February into the national security threat posed by connected vehicles, and particularly those from China. At the time, the White House noted that connected cars could “record detailed information on U.S. infrastructure" and could be "piloted or disabled remotely."

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“It doesn’t take a lot of imagination to think of how foreign government with access to connected vehicles could pose a serious risk to both our national security and the personal privacy of U.S. citizens,” U.S. Secretary of Commerce Gina Raimondo said in February. Estevez's comments paint the most complete picture yet of the kind of action the Commerce Department plans to propose.

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The security fears go both ways. In the past, China has reportedly barred vehicles made by Tesla, an American company, from certain government and military installations over privacy concerns.

Contact the author: tim.levin@insideevs.com

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