The US just announced plans to prohibit both automotive hardware and software from China across the country in an effort to curb national security threats.
It’s no secret that the US and China are at odds when it comes to the business world. The TikTok fiasco is a good example, with the US attempting to ban one of the most popular apps in the world because its parent company is based in China.
Now, the battle is bleeding over to the world of cars, with the latest move having a potentially significant impact on the auto industry as a whole.
US Commerce Department Proposes Chinese Car Tech Ban
Announced by the US Commerce Department this week, the Biden administration is pursuing a ban on Chinese automative hardware and software. The news, broken by Reuters, means that Chinese cars and vans would effectively be prohibited from the US market as a whole.
As is often the reason, officials have noted that national security is behind the decision to ban Chinese car tech from US roads.
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“When foreign adversaries build software to make a vehicle [connected], that means it can be used for surveillance, can be remotely controlled, which threatens the privacy and safety of Americans on the road.” – Gina Raimondo, US Commerce Secretary
While the premise sounds straight out of a Fast and Furious movie, the concerns are at least somewhat founded. Given the nature of modern connected car technology, it’s certainly possible to gain control over a vehicle without being behind the wheel.
The Response From China
While threats to national security should certainly be addressed, Chinese officials have pointed out that the move to ban all connected car technology from the country is an escalation in what exactly is considered a “national security” threat.
“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” – Lin Jian, spokesman for China’s Foreign Ministry
The possible ban isn’t just concerning for Chinese automative manufacturers. In fact, some of the prohibitions could extend to other countries that are at odds with the US, including Russia.
US vs China on Cars
This isn’t the first shot across the bow when it comes to the US vs China in the business world, especially when it comes to cars. Whether it be to curb national security concerns or favor US manufacturers on the road, the Biden administration has made more than a few moves to hamper China’s efforts.
The US has raised tariffs on electric cars and electric car batteries from China, making it difficult to sell them in the US for a reasonable price. Officials have even banned Chinese-made cargo cranes from importation, setting a clear example that US doesn’t want China operating businesses in the country.
Suffice to say, the tensions between the US aren’t likely to abate any time soon, and the US will do what it can to slow China down. But with the country outpacing the US in AI and electric cars, it’s safe to say these bans are just the beginning.
