The Biden administration on Monday announced a comprehensive effort to ban Chinese software from internet-connected cars in the United States, justifying the move on national security grounds. The measures are aimed at preventing Chinese intelligence agencies from monitoring Americans’ movements or using car electronics as a conduit for infiltration into the U.S. power grid and other critical infrastructure.
The move will likely be the last major suspension of Chinese imports into the United States under the Biden administration, but follows the same logic that led to bans on Huawei telecommunications equipment and investigations into Chinese-made cranes operating in U.S. ports.
Combined with efforts by Congress to force TikTok to sever ties with its Chinese owners, the effort is a major addition to the administration’s efforts to contain what it sees as a major cyber vulnerability for the U.S. But it has also effectively begun to lower a digital iron curtain between the world’s two largest economies, which only two decades ago proclaimed that the internet would unite them.
Administration officials told reporters the Commerce Department proposed the ban because of national security concerns, not politics, and the official said it would probably become a permanent rule before Biden leaves office on Jan. 20. Biden announced this year that he would impose 100% tariffs on Chinese-made electric vehicles, citing heavy subsidies in China. The announcement was notable because such vehicles were just beginning to enter the U.S. market. Biden explicitly framed it as a way to preserve American jobs.
“A lot of these technologies are collecting a lot of information about drivers,” Jake Sullivan, President Biden’s national security adviser, told reporters on Sunday. These technologies are constantly connected to personal devices, other cars, America’s critical infrastructure and even the original manufacturers of the vehicles and parts.
“Connected cars and the technologies they use therefore pose new vulnerabilities and threats, particularly when the vehicles or parts are developed in China or other countries of concern,” he added, using China as an acronym for the People’s Republic of China.
Sullivan cited U.S. concerns about an attack called Bolt Typhoon, which U.S. intelligence officials and the FBI say is a Chinese attempt to insert code into U.S. power systems, water pipes and other critical infrastructure. U.S. officials worry that in a crisis — such as a Chinese attempt to seize Taiwan — the code could be used to disable U.S. military bases and delay a response.
Officials said they were evaluating other industries that could be subject to software and hardware rules similar to those proposed for the Chinese auto industry, but that none of the industries they were currently considering would be affected by China’s auto ban.
Combating real and perceived threats from China is one of the few issues that has support from both Democrats and Republicans, but many China experts believe fears of Beijing have gone too far and are having a negative impact on U.S. consumers. That said, experts believe the expanding list of banned imports from China and restrictions on the types of chips and software that can be exported to Beijing will probably only accelerate, whether former President Donald J. Trump is returned to office or Vice President Kamala Harris is elected.
Richard Fontaine, executive director of the Center for a New American Security and author of the recently published “The Lost Decade: The US’s Pivot to Asia and the Rise of China,” said in an interview that the move was an expansion of U.S. efforts to “put a tall fence around our little garden” of strategically important supplies.
“When it comes to Chinese tech, the ‘little garden’ is expanding and will continue to do so no matter who wins the November election,” Fontaine said. “Policymakers across the board are increasingly concerned about the national security risks associated with Chinese tech, especially as they imagine what would happen if a conflict were to break out.”
The proposed rules would include Russian software, but Russia produces very little of the software that would be banned.
“I think this precedent is important and just reflects the complexity of a world in which many connected devices could be weaponized,” said Brad Setzer, a senior fellow at the Council on Foreign Relations. “Security competition and conflict between the U.S. and China is intensifying, so it’s certainly possible that this precedent could expand over time.”
Peter Harrell, who served as senior director for international economics at the National Security Council during the Biden administration, said federal authorities could investigate Chinese-made drones that pose similar surveillance and security risks.
“This will open the door to a much broader series of government actions over the course of several years,” Harrell said.
While he said it was unclear whether the Biden administration would be able to accomplish more by the end of its term, he said, “This situation will continue under either Trump or Harris.”
The proposed ban would apply to all wheeled vehicles that travel on roads, including cars, trucks and buses. It would exempt vehicles that are not used on public roads, such as agricultural and mining vehicles.
The ban on Chinese- or Russian-made software in connected or autonomous cars would begin with model year 2027. The proposed rules would also ban hardware integrated into vehicle connectivity systems starting with model year 2030.
Commerce Secretary Gina Raimondo acknowledged that there are currently few Chinese or Russian vehicles on U.S. roads, but said the administration wants to take aggressive steps to “protect American citizens, including children, from potential surveillance.”
Raimondo said a foreign adversary could use connected car software to collect data such as where drivers live or where their children go to school. In an extreme situation, a foreign adversary could shut down or take control of all vehicles operating in the United States, which could lead to crashes and road closures, she said.
“This is not about trade or economic interests,” Raimondo said in a conference call with reporters on Sunday. “This is entirely a national security action.”
The proposed rule came after President Biden in February ordered the Commerce Department to launch an investigation into the threat of technology built into Chinese vehicles.
It also follows steps taken by the Biden administration to block Chinese vehicle imports, which officials worry could undermine the administration’s efforts to expand domestic manufacturing of clean energy products.
The Biden administration in May quadrupled tariffs on Chinese-made electric vehicles to 100%, a move aimed at making those cars even more expensive and protecting U.S. automakers that stand to receive billions of dollars in federal subsidies. The federal government is offering attractive tax credits and grants as incentives for companies to roll out more electric vehicles, solar and wind energy projects. The effort is expected to cost hundreds of billions of dollars over the next decade.
The administration is also moving to limit Chinese companies’ ability to benefit from tax credits that consumers can claim to offset the costs of electric vehicles.
