US eyeing new rules to keep Chinese software out of cars

The US Commerce Department is expected to issue new rules in August placing limits on vehicle software that comes from China, according to Reuters.

The new rules come as the Biden administration ramps up its scrutiny of Chinese auto imports, in an effort to prevent the country from flooding the market with cheap electric vehicles.

While speaking at a forum in Colorado, Alan Estevez, who serves as Under Secretary of Commerce for Industry and Security, said that the department would propose rules that would require certain vehicle software be made in the US or by its trade partners. The rules would pertain to “key driver components of the vehicle that manage the software and manage the data around that car,” Estevez said, according to Reuters.

Such action would mirror trade restrictions placed against companies like Huawei over national security concerns that the telecom giant could be exploited by the Chinese government for espionage. 

The rules would stem from an investigation launched earlier this year by the Commerce Department into connected vehicle software produced in China and other nations that are considered antagonistic to the US.

The probe focused on “connected vehicles,” a broad term that can be applied to any car with internet access. It was meant to address concerns that technology like cameras, sensors, and on-board computers could be exploited by foreign adversaries to collect sensitive data about US citizens and infrastructure.

China has previously accused the US of repeatedly abusing “the concept of national security” to wrongfully target Chinese companies and impede competition from global markets. 

The new rules could end up mirroring similar provisions in the federal EV tax credits, which prohibit the credit from being applied to vehicles with battery components made in China. The administration has also proposed steep tariffs on Chinese vehicles, in an effort to make them too expensive to sell in the US.