U.S. escalates tech battle with China in auto sector ban

On Monday, September 23, at 9:00 a.m. Eastern Time, the U.S. Department of Commerce proposed banning Chinese software and equipment in network-connected vehicles used on American roads. The reason is concerns about national security.

The Biden administration has expressed concern about the potential issue of key data collection by systems installed in Chinese vehicles. This concerns information regarding U.S. road infrastructure or the behaviour of local drivers.

There is a risk that knowledge gained in this way by the Chinese could be used improperly.

"When foreign adversaries build software to make a vehicle, that means it can be used for surveillance, can be remotely controlled, which threatens the privacy and safety of Americans on the road," said Commerce Secretary Gina Raimondo, quoted by "Reuters."

"In an extreme situation, 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, blocking roads," she added.

For now, there are not too many cars from China in the U.S. The Biden administration, however, wants to be cautious and prevent potential expansion in time. The regulations, essentially equated with banning the use of all new vehicles from China in the U.S., would take effect as early as 2027.

The regulations would apply to all vehicles allowed on the road, excluding construction, mining, or agricultural equipment used off public roads.

It is worth noting that the planned regulations could hit Chinese manufacturers and other companies (including American ones) that produce or design their cars in China. Examples include Volvo, Ford, and General Motors.

Final decisions have not yet been made, but everything indicates that the plan will come to fruition. This is another American blow to Chinese manufacturers. Earlier, the Biden administration imposed a 100% tariff on electric vehicles from China.