The US Department of Commerce is preparing to propose a ban on the sale and import of smart vehicles that incorporate specific technology from China or Russia, citing national security risks.
According to US officials, the investigation, which began in February, uncovered potential threats associated with embedded software and hardware of Chinese and Russian origin. These include vulnerabilities to remote hacking and the potential collection of sensitive personal data from drivers. Commerce Secretary Gina Raimondo, speaking to reporters on a Sunday conference call, highlighted the gravity of the situation.
“In extreme situations, a foreign adversary could shut down or take control of all their vehicles operating in the United States, all at the same time, causing crashes (or) blocking roads,” Raimondo explained.
A senior administration official clarified to CNN that the proposed rule would not impact vehicles already on US roads that have Chinese software installed. The ban on software would apply to vehicles with a “model year” of 2027 and the hardware ban to those with a “model year” of 2030, the Commerce Department announced.
This regulatory action is part of a larger strategic competition between the United States and China over control of key computing technologies, encompassing semiconductors and AI software. The connected car market is a particular area of focus, where China has invested heavily. The growing presence of Chinese manufacturers in Europe has already triggered concerns among US officials.
In the past, CNN has reported on China’s own security concerns surrounding Tesla (TSLA) vehicles, with some governmental bodies restricting their entry into specific compounds. The proposed rule applies to “connected vehicles,” a broad term for modern cars, buses, and trucks that use networks for services like roadside assistance and satellite communications. It covers hardware and software that facilitate vehicle communication with the outside world, including Bluetooth, WiFi, and cellular technology.
The Commerce Department will open a 30-day public comment period for the proposed rule, with the goal of issuing a final regulation before the end of the Biden administration, said a senior administration official. Furthermore, the administration will release an economic analysis on Monday outlining the expected costs for automakers and consumers in complying with the new rule.
Secretary Raimondo was quick to note that the move was not protectionist, a charge some Chinese critics have levied. “This is not about trade or economic advantage,” she said, emphasizing, “This is strictly a national security action.”
“If (China) or Russia, for example, could collect data on where the driver lives or what school their kids go to, where (their) doctor is, that’s data that would leave that American vulnerable,” Raimondo added.
US officials are also concerned about electric charging stations and other infrastructure containing potentially exploitable software and hardware with ties to China, Russia, or other foreign powers. White House national security advisor Jake Sullivan noted on the conference call, “We’ve already seen ample evidence of the PRC pre-positioning malware on our critical infrastructure for the purpose of disruption and sabotage.” Sullivan used an acronym for the Chinese party.
With an increase in smart cars on US roads using vulnerable, Chinese-made technology, “the risk of disruption and sabotage increases dramatically,” Sullivan warned.
The Chinese government responded to these allegations with a denial. Lin Jian, spokesman for China’s Foreign Ministry stated that, “China opposes the US’s broadening of the concept of national security and the discriminatory actions taken against Chinese companies and products… We urge the US side to respect market principles and provide an open, fair, transparent, and non-discriminatory business environment for Chinese enterprises.”
This is just the latest example of the Commerce Department utilizing its broad regulatory powers to protect US consumers from foreign-made software deemed a national security threat. In June, the department prohibited the sale and provision of specific products and services from the Russian cybersecurity firm Kaspersky Lab, whose anti-virus software is used by hundreds of millions globally.
Supporting American Autoworkers
The proposed ban coincides with the White House’s announcement of new initiatives designed to bolster auto workers, particularly in Michigan, a key state in President Joe Biden’s 2020 election victory. Vice President Kamala Harris’ campaign considers Michigan a critical state to win in November.
Other initiatives that the White House announced on Monday include $1 billion in funding allocated to small- and medium-sized auto suppliers; a pilot program aimed at training workers for automobile supply chain jobs in Michigan’s most populous county; financial support to increase training for workers installing electric vehicle chargers; and several other initiatives across the state. These moves are a part of a broader effort to secure support from unionized auto workers in the Midwest, a key demographic for both Biden and Harris. In a move that demonstrated his support, Biden became the first president to visit a picket line during the United Auto Workers’ strike last year, and has continued to cultivate union members in his political messaging.
Harris has also maintained a focus on the state, and has made several visits to Michigan since her rise on the ticket. The White House fact sheet for the new initiatives notably featured a quote from the Vice President highlighting the programs. The fact sheet did not include any quotes from President Biden.
“I believe in an economy where everyone has a chance to compete and a chance to succeed. Investing in the ambitions and aspirations of our people is the best way to grow the American economy and the middle class,” Harris stated.
“Yet for far too long, we have seen lack of investment in communities across America and profound obstacles to economic opportunity—including in communities with historic manufacturing expertise such as Detroit.”
