1-3-2024 (WASHINGTON) President Joe Biden has taken decisive measures to investigate and potentially restrict the entry of internet-connected Chinese cars, including electric vehicles (EVs), into the US auto market. Citing national security risks due to the potential transmission of sensitive information to Beijing through their operating systems, the move could lead to new regulations or limitations on Chinese vehicles.
The immediate action involves a Commerce Department investigation into security threats, marking the first step in a broader strategy to prevent low-cost Chinese EVs from dominating the US market. The investigation focuses on Chinese-made versions of common automotive software, which officials say could pose cybersecurity risks by tracking American drivers’ activities.
China has rapidly expanded its EV production, creating competition with Biden’s efforts to establish American dominance in the EV market. Some smaller Chinese cars are significantly cheaper than their American counterparts, raising concerns about the impact on domestic automakers.
Biden’s administration is responding to concerns raised by Detroit automakers, union autoworkers, and Tesla. The move aligns with the president’s commitment to ensure the dominance of the American auto market and protect national security.
While the immediate action does not impose new barriers on Chinese EVs, it initiates an investigation into the technology embedded in these vehicles. The investigation could result in new restrictions on vehicles relying on Chinese software.
The broader strategy includes exploring additional steps to impede the import of Chinese vehicles, such as potential tariff increases. Treasury Department proposals have already aimed at limiting China’s ability to supply materials for cars and trucks eligible for EV tax credits.
Lael Brainard, head of the National Economic Council, stated that the administration would continue examining policies to maintain the competitiveness of American carmakers. The Treasury Department and Commerce Department’s moves reflect a growing trend towards more stringent technology restrictions on China and signal a continued focus on antagonistic trade relations between the US and China.
Commerce Secretary Gina Raimondo emphasized the cybersecurity risks posed by Chinese EVs, highlighting the importance of economic and national security in maintaining a robust US auto industry.
