Citing potential national security concerns, the Biden administration has announced its intention to scrutinize Chinese smart cars capable of gathering sensitive information about American drivers.
“China is determined to dominate the future of the auto market, including by using unfair practices,” Biden stated in a Thursday release. “China’s policies could flood our market with its vehicles, posing risks to our national security. I’m not going to let that happen on my watch.”
Biden and other officials highlighted China’s imposition of extensive restrictions on American and other foreign automobiles.
Commerce Secretary Gina Raimondo likened connected cars to “smartphones on wheels” and emphasized the grave national security risks they pose.
What are the risks with Chinese smart cars
“These vehicles are connected to the internet. They collect huge amounts of sensitive data on the drivers — personal information, biometric information, where the car goes,’’ she told reporters late Wednesday. “So it doesn’t take a lot of imagination to figure out how a foreign adversary like China, with access to this sort of information at scale, could pose a serious risk to our national security and the privacy of U.S. citizens.”
Concerns extend beyond data collection, with officials warning of the potential for connected vehicles to be remotely accessed or manipulated by malicious actors.
“Imagine if there were thousands or hundreds of thousands of Chinese-connected vehicles on American roads that could be immediately and simultaneously disabled by somebody in Beijing,’’ Raimondo said. “So it’s scary to contemplate the cyber risks, espionage risks that these pose.”
Although few Chinese cars currently enter the United States, in part due to hefty tariffs imposed by the U.S. on vehicles from China, officials fear that tariffs alone may not be sufficient. Some Chinese firms may seek to circumvent U.S. tariffs by establishing assembly plants in neighboring countries like Mexico.
What administration is doing about Chinese smart cars?
As part of the initiative announced on Thursday, the Commerce Department is initiating an advanced notice of proposed rulemaking to investigate national security threats posed by “connected vehicles” from China and other nations considered adversarial to the United States
The White House announced that the Commerce Department will solicit input from the automotive industry and the general public regarding the nature of risks associated with, and potential measures to mitigate, the use of technology in vehicles originating from China and other “countries of concern,” including Russia and Iran.
“We’re doing it now, before Chinese manufactured vehicles become widespread in the United States and potentially threaten our privacy and our national security,” remarked Raimondo.
This investigation marks the inaugural step by the Commerce Department’s Bureau of Industry and Security in response to executive orders issued by Biden aimed at protecting domestic information and communication technology from national security threats.
According to the White House, electric vehicles and other automobiles increasingly depend on advanced technologies for navigation, driver assistance, and carbon emission reduction. However, these vehicles continually interact with personal devices, other vehicles, U.S. infrastructure, and their manufacturers, thereby posing national security risks.
The White House highlighted the potential for new vulnerabilities and threats to emerge with connected vehicles if foreign governments gain access to their systems or data.
While the Trump administration’s imposition of high tariffs, which the Biden administration has maintained, has dissuaded Chinese automakers from entering the U.S. market, concerns persist that Chinese companies may absorb additional costs as China intensifies its focus on exports. Chinese automakers are also expanding their presence overseas, with EV giant BYD announcing plans for its first European plant last year.
Ford CEO Jim Farley expressed concerns about competing with Chinese automakers in the EV sector, noting their rapid increase in market share in Europe over the past two years.
John Bozzella, president of the Alliance for Automotive Innovation, representing major automakers, warned that proposed U.S. environmental regulations could inadvertently bolster China’s position in America’s electric vehicle battery supply chain and automotive market.
In response to rising imports from China, the European Union launched a trade investigation last year into Chinese subsidies for electric vehicles, an inquiry that remains ongoing.