US bans Chinese and Russian tech in smart cars

‘Targeted approach’ meant to ensure foreign adversaries’ software and hardware are kept off American roads, US official says

WASHINGTON — The Joe Biden administration has finalised rules effectively barring the sale of smart cars containing Chinese or Russian technology in the US market, a last push by the outgoing American president to address national security concerns tied to the auto industry.

As announced by the Commerce Department on Tuesday, the prohibition on sales applies to connected vehicles for model year 2027 by manufacturers with a sufficient nexus to China or Russia, even if they were manufactured in the United States.

Software bans would take effect for model year 2027 as well, while hardware restrictions would come into play for model year 2030. Curbs on those without a model year would start on Jan 1, 2029.

Yet currently the final rule only applies to passenger vehicles weighing less than 10,001 pounds (4,536 kilogrammes) “given the complexity of the commercial vehicle supply chain”, the Commerce Department said.

As for technologies in smart commercial vehicles like trucks and buses, the department has plans to issue a separate rule “in the near future”.

Tuesday’s news followed months of regulatory review including meetings with industrial experts and the gathering of public opinion.

It came after the Biden administration in March suggested it was considering a phased approach to ban the use of Chinese and Russian technologies for automated driving systems and vehicle communications systems.

And it marked the administration’s latest effort to limit the reach of technologies from rivals like Beijing owing to national security concerns.

That included a sweeping rule unveiled on Monday to restrict the export of US-developed computer chips that empower artificial intelligence (AI) systems.

Earlier this month, the Commerce Department said it was soliciting the views of private companies regarding a rule that could restrict or ban Chinese drones in the US.

In response, the Chinese embassy in Washington said the restrictions would undermine global supply chains and affect the interests of the US industries and customers.

“We urge the US side to … respect market economy laws, stop turning economic and trade issues into political, security or ideological issues, and provide an open, fair, just and non-discriminatory environment for the investment and operation of businesses from all countries, including China,” Liu Pengyu, the embassy’s spokesman, said in an email to the Post.

Elaborating on the move, Commerce Secretary Gina Raimondo said the new rules announced on Tuesday were needed to protect US national security and keep foreign adversaries from manipulating technologies to access drivers’ and owners’ sensitive or personal information.

Vehicles now had cameras, microphones, Global Positioning System (GPS) tracking and other technologies connecting to the internet that could leave large swathes of the US population vulnerable, she explained.

“This is a targeted approach to ensure we keep PRC and Russian-manufactured technologies off American roads and protect our nation’s connected vehicle supply chains,” she added, referring to China by its official abbreviation.

Speaking at an event hosted by the Washington-based think tank Centre for Strategic and International Studies on Tuesday, undersecretary of commerce for industry and security Alan Estevez said the measures were necessary to curb the amount of data that could potentially be exploited by Beijing.

“Your car knows probably more about you than your spouse or your friends know, because your car knows where you go all the time. As long as you’re in your car, that little GPS device knows where it’s going, and it’s keeping track of that,” he said.

Estevez added that a software update could render a vehicle unusable, which amounted to “a risk to the critical infrastructure of the United States”.

At present, Chinese electric vehicle manufacturer Build Your Dreams (BYD) has a factory in California producing buses and other vehicles, while a handful of car brands owned by mainland companies, such as Lotus and Volvo, also have facilities stateside.

The bid to blunt rival countries’ technologies comes as Washington seeks to boost America’s car industry and as it tries to cut reliance on Beijing’s supply chain.

The US has imposed a 100% tariff on electric vehicles (EVs) from China, which now leads the world in their production.

On Tuesday, Biden issued an executive order to accelerate the pace of infrastructure development for AI, a technology he said would “define the future”.

But the impact of those plans depends on president-elect Donald Trump, who is to be inaugurated on Monday, and whether he carries the Biden administration efforts forward.