US Targets Chinese Tech in Cars, Citing Security Risks and Remote Hacking

China Continues to Expand Its Influence
US Takes Firm Action
Ban on Chinese Vehicle Products

The Biden administration is set to introduce stringent regulations banning Chinese software and hardware in connected and autonomous vehicles on American roads. This sweeping move, which will affect the latest car models, could significantly affect the global automotive industry.

According to a report by Reuters, the administration plans to prohibit the importation and sale of critical communications and autonomous driving system software and hardware produced in China. Automakers are closely monitoring these developments as they could reshape the market landscape.

All Restrictions on Chinese Software and Hardware

Sources indicate that the U.S. Department of Commerce will implement a ban on Chinese software starting with the 2027 model year, followed by a prohibition of hardware in 2029 or 2030. The restrictions are expected to encompass vehicles equipped with specific Bluetooth, satellite, and wireless capabilities, along with high-performance autonomous cars that require minimal human intervention.

The Commerce Department has announced a 30-day comment period for stakeholders before finalizing these regulations. Furthermore, the U.S. government may extend these bans to other nations deemed hostile, including Russia.

Beware of Remote Hacking Through Chinese Products

The Biden administration has expressed concerns regarding connected vehicles that exchange information via wireless networks and support navigation and autonomous functions. Officials worry that Chinese firms could collect data on American drivers and infrastructure, potentially allowing them to control internet-connected vehicles remotely.

U.S. Commerce Secretary Gina Raimondo highlighted the risks in May 2024, stating, “There are millions of vehicles on the road in the U.S. If the software suddenly stops working, we can expect catastrophic damage.” This acknowledgment underscores the perceived threat posed by Chinese software and hardware in connected vehicles.

Amid Ongoing Scrutiny, Will South Korea Be Affected?

South Korean automakers may face considerable challenges as the U.S. intensifies restrictions on Chinese vehicles and components. The Biden administration recently announced a plan to impose 100% tariffs on Chinese electric cars, alongside increased tariffs on electric vehicle batteries and essential minerals.

Since most new U.S. vehicles are connected, South Korean automobile exports could be significantly affected. To mitigate potential supply chain disruptions, the South Korean government and automakers are actively engaging with U.S. officials to advocate for regulations that focus only on parts and services deemed a “significant risk to national security” and to secure a grace period for compliance.