New U.S. Rule May Block 100% of Chinese Auto Software by 2027—Are Connected Vehicles at Risk?

Govind Tekale

The Bureau of Industry and Security (BIS), under the United States Department of Commerce, has proposed a ban on software and hardware systems developed by China.

Photo Source: Google

Photo Source: Google

Photo Source: Google

The ban is based on high national security risks due to specific transactions involving information and communications technology and services (ICTS) designed or developed by certain foreign adversaries, particularly related to connected vehicles.

BIS identified the People's Republic of China, including the Hong Kong Special Administrative Region (PRC), and the Russian Federation (Russia) as the two foreign adversaries posing threats to U.S. national security.

Photo Source: Google

Photo Source: Google

These countries can leverage domestic legislation and regulatory regimes to compel companies under their jurisdiction, including automakers and their suppliers, to cooperate with security and intelligence services, potentially gaining access to sensitive data or enabling remote manipulation of connected vehicles operated by U.S. citizens.

Photo Source: Google

BIS plans to involve manufacturers in this decision-making process, allowing them time to adapt to the impending changes.

Photo Source: Google

Photo Source: Google

The proposed ban follows the White House's announcement in May 2024 of a tariff rate hike on electric vehicles, under Section 301, from 25% to 100%.

Photo Source: Google

The Chinese Department of Commerce has opposed the move and issued a statement objecting to the decision.

Photo Source: Google

Photo Source: Google

Jeff Farrah, CEO of the Autonomous Vehicle Industry Association (AVIA), has expressed support for the decision and issued a statement in its favor.

Photo Source: Google

U.S. Secretary of Commerce Gina Raimondo defended the action taken by her department and released a statement justifying the ban.

Photo Source: Google

Photo Source: Google

next story

Electric Fan Car McMurtry Spéirling Sets 1:18.4 Lap at Laguna Seca, Besting Czinger and Koenigsegg

Learn more