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u.s. department of commerce: ban on chinese smart connected vehicle technology, effective in 2027

2024-09-24

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author | zer0

editor | mo ying

zhidongxi reported on september 24 that yesterday, the u.s. department of commerce’s bureau of industry and security issued a notice of proposed rulemaking (nprm), proposingprohibit the sale or import of connected cars that integrate certain software and hardware from china or russia

the proposed rule wouldprohibit the import and sale of software and hardware with ties to china or russia that are integrated into vehicle connected systems (vcs) or automated driving systems (ads)

vcs is a group of systems that allow the vehicle to communicate externally, including telematics control units, bluetooth, cellular, satellite and wi-fi modules. the ads system includes components that allow a highly automated vehicle to operate without a driver. these key systems enable external connectivity and automated driving capabilities of connected vehicles through specific hardware and software.

the rule will alsoprohibits chinese or russian-affiliated manufacturers from selling connected vehicles in the u.s. that contain vcs hardware or software or ads software, even if the vehicle is manufactured in the u.s.

the u.s. department of commerce said in a statement that malicious access to these systems could enable adversaries to access and collect sensitive data and remotely control vehicles on u.s. roads.

the proposed rule wouldapplies to all wheeled vehicles on public roads, including cars, trucks and buses, but does not affect agricultural or mining vehicles not used on public roadscar

liz cannon, director of the u.s. department of commerce's office of information and communications technology, predicts thatany car produced in china and sold in the united states will be included in the ban.

the biden administration will draft the final rule after a 30-day public comment period and plans to make it a permanent regulation before president biden leaves office on january 20.

the software ban will apply tomodels 2027 and later, the hardware ban will bejanuary 2029 or 2030 modeltake effect.

the move effectively bans chinese cars and trucks from the u.s. market and forces manufacturers to remove key chinese software and hardware supplies from vehicles sold in the united states in the coming years.

chinese foreign ministry spokesman lin jian responded at a regular press conference on september 23:as a principle, i want to emphasize that china opposes the us's generalization of the concept of national security and its discriminatory practices against relevant chinese companies and products. we urge the us to respect market principles and provide an open, fair, transparent and non-discriminatory business environment for chinese companies. china will firmly safeguard its legitimate rights and interests.

administration officials acknowledge that there are currently few chinese or russian cars on u.s. roads, and the rule is intended to eliminate any national security threat they could pose in the future.

they also revealed thatthe commerce department is evaluating other industries where similar action might be taken, such as drones or cloud infrastructure.

the government officials said that because there is so little chinese and russian software in the united states, it is relatively simple to eliminate, but hardware is more challenging, with a more complex supply chain and more chinese hardware. the hardware ban only applies to components of vehicle connectivity systems, and chinese-made batteries are not covered by the rule.

banning chinese smart connected car software and hardware is the latest move by the united states to suppress chinese cars, software and components.

u.s. government officials said the move came after seven months of review, amid concerns that overseas countries could gain access to americans' driving habits data or remotely control u.s. cars via the internet.

the proposed ban would prohibit chinese and russian automakers from testing self-driving cars on u.s. roads and could be extended to other u.s. adversaries.

the united states has significantly increased tariffs on chinese imports this year, including a 100% tariff on chinese electric vehicles and additional tariffs on electric vehicle batteries and critical minerals.

the u.s. government is offering generous tax credits and subsidies to encourage american companies to deploy more electric vehicles, solar and wind energy projects, a plan expected to cost hundreds of billions of dollars over the next decade.

the u.s. government's move is likely to face resistance from automakers.

in april, the alliance for automotive innovation, an industry group, warned that it would be difficult to quickly replace chinese parts with alternative systems.

"you can't flip a switch and change the world's most complex supply chain overnight." john bozzella, president of the alliance for automotive innovation, which represents most major u.s. automakers, said in a new statement that "very little" u.s. automakers use software or hardware from china, but the rule will require automakers to find alternative suppliers in some cases, and some automakers may need more time to comply.

the proliferation of electronics in cars presents a dilemma for policymakers and automakers. china is a key supplier of technologies such as lidar, which uses light to detect objects and is critical to many driver-assistance systems. chinese automakers have also developed some of the most advanced self-driving systems. if u.s. automakers don’t have access to the latest technology, they risk falling behind.

the us government has been continuously implementing the "small courtyard, high wall" strategy, under the guise of "national security", and has repeatedly stepped up its technological suppression of china, trying to prevent the development of china's technology industry. this approach of weakening overseas opponents through legislation reflects the us's lack of confidence in the face of global challenges. it is ironic that the us, which advocates market freedom, has now pulled down the digital iron curtain and frequently intervened in the market.