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In a bid to safeguard U.S. national security, newly proposed House legislation aims to regulate or possibly ban the introduction of connected vehicles by Chinese EV makers in the American market.
U.S. Representative Elissa Slotkin introduced the bill amid the escalating tensions between the U.S. and China. The situation further intensified after the Biden administration chose to increase the import duties on Chinese electric vehicles by 400%, setting the rate at 100%.
Although Chinese EV makers have yet to establish a substantial foothold in the U.S. as opposed to their success in Europe, the legislation aims to prevent them from potentially dominating the market with economical and intelligent vehicles.
Slotkin, with her experience as a CIA analyst and Department of Defense official, has consistently informed Congress about the potential risks associated with Chinese-produced connected cars. In a House floor speech, Slotkin detailed the Chinese state’s substantial investments into producing next-generation EVs with data-gathering technologies, which pose an intelligence risk.
In Slotkin’s view, these connected vehicles could provide the Chinese government with a wealth of intelligence on the U.S., which could include data on military locations, infrastructure, and the whereabouts of U.S. leaders. Therefore, she emphasizes the urgency of erecting defenses before these vehicles penetrate the U.S. market.
Recently, measures Slotkin advocated for were incorporated into the federal defense spending legislation, which includes a ban on these vehicles at U.S. military facilities and forbids the use of Chinese-made lidar by the Department of Defense.
The Connected Vehicle National Security Review Act, introduced by Slotkin, would lead to a comprehensive examination of connected and autonomous vehicles with ties to China. This includes companies like WeRide and Pony.ai who are actively testing in California, as well as a joint endeavor between Alphabet’s Waymo and Chinese firm Zeekr.
The inquiries by TechCrunch regarding the bill have yet to receive responses from Waymo.
Potential Impacts of the Bill on Chinese EV Companies
Volvo and Polestar currently have a presence in the U.S. market, both under the ownership of Geely Automotive of China. While most Volvo cars are produced in Sweden, future North American models will be assembled at the Ridgeville plant in South Carolina.
A spokesperson from Polestar confirmed their adherence to GDPR regulations due to their Swedish base of operations and assured no sharing of North American or European customer data with China.
This bill, however, imposes strict scrutiny on all connected vehicles, regardless of where they are made, that are “designed, built or supplied” by entities linked to China or other countries of concern, based on the legislation’s review protocols set by the Department of Commerce.
The bill extends beyond tariffs and could block vehicles from entering the U.S. when manufactured by Chinese firms in third countries, such as Mexico, which could affect companies like BYD. It also ensures that the Department of Commerce and other agencies maintain the power to enforce national security measures.
Slotkin referenced former President Trump’s actions regarding TikTok as an example of the need for such security measures. Meanwhile, with China softening its cross-border data regulations, Tesla is reportedly seeking permission to send its car data back to the U.S. to enhance its self-driving technology.
The timing of Slotkin’s bill is aligned with the Department of Commerce’s promise to finalize a decision on Chinese connected vehicles later in the year. Slotkin plans to officially introduce the bill when Congress resumes after the Memorial Day break.
The content of this article has been updated to include a comment from Polestar and was initially published at 8:55 a.m. PT.
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Frequently Asked Questions (FAQ)
What is the purpose of the proposed House bill regarding Chinese EVs?
The goal of the House bill is to potentially regulate or ban the deployment of connected vehicles by Chinese EV manufacturers in the U.S. market to protect national security interests.
What concerns does the proposed bill address regarding Chinese connected vehicles?
The bill addresses concerns that Chinese connected vehicles could collect and transmit sensitive data back to China, potentially providing Chinese authorities with intelligence on the U.S. military, infrastructure, and leadership.
What companies could be affected by this bill?
Chinese EV companies, such as WeRide, Pony.ai, and BYD, could be affected. Additionally, partnerships between U.S. firms and Chinese companies, like the one between Alphabet’s Waymo and Zeekr, could also be impacted.
Has Waymo responded to the proposed legislation?
As of the information provided, Waymo has not issued a response regarding the proposed bill.
When is the Connected Vehicle National Security Review Act expected to be introduced in Congress?
U.S. Representative Elissa Slotkin plans to introduce the bill after Congress reconvenes following the Memorial Day recess, starting June 3.
