US to ban smart cars containing Chinese or Russian tech

WASHINGTON - The US finalised a rule on Jan 14 effectively barring Chinese technology from cars in the American market, taking aim at software and hardware from the world’s second-biggest economy over national security risks.

The announcement, which also pertains to Russian technology, comes as outgoing President Joe Biden wraps up efforts to step up curbs on China, and after a months-long regulatory process.

Beijing on Jan 15 said it “firmly opposes” a US move to effectively bar Chinese technology from smart cars in the American market, saying alleged risks to national security were “without any factual basis”.

“Such actions disrupt economic and commercial cooperation between enterprises... and represent typical protectionism and economic coercion,” foreign ministry spokesman Guo Jiakun said, adding: “China firmly opposes this.”

The US rule follows an announcement in January that Washington is mulling over new restrictions to address risks posed by drones with tech from adversaries such as China and Russia.

“Cars today aren’t just steel on wheels – they’re computers,” said Commerce Secretary Gina Raimondo.

She noted that modern vehicles contain cameras, microphones, Global Positioning System tracking and other technologies connected to the internet.

“This is a targeted approach to ensure we keep PRC and Russian-manufactured technologies off American roads,” she added, referring to the People’s Republic of China.

But Mr Guo slammed the move, telling journalists in Beijing that China would “take necessary measures” to safeguard its legitimate rights and interests.

“What I want to say is that the US, citing so-called national security, has restricted the use of Chinese connected vehicle software, hardware, and entire vehicles in the United States without any factual basis,” he told a regular press conference.

“China urges the US to stop the erroneous practice of overgeneralising national security and to stop its unreasonable suppression of Chinese companies.”

The final rule currently applies just to passenger vehicles under 4,536kg, said the Commerce Department.

It plans, however, to issue separate rule-making aimed at tech in commercial vehicles such as trucks and buses “in the near future”.

For now, Chinese electric vehicle manufacturer BYD has a facility in California producing buses and other vehicles.

National economic adviser Lael Brainard added that “China is trying to dominate the future of the auto industry”.

But she said connected vehicles containing software and hardware systems linked to foreign rivals could result in misuse of sensitive data or interference.

Under the latest rule on Jan 14, even if a passenger car was US-made, manufacturers with “a sufficient nexus” to China or Russia are not allowed to sell such new vehicles incorporating hardware and software for external connectivity and autonomous driving.

This prohibition on sales takes effect for model year 2027.

The restriction also bans the import of the hardware and software if they are linked to Beijing or Moscow.

The software curbs take effect for model year 2027 while the hardware controls come into play for model year 2030.

US efforts to restrict Chinese tech come as officials work to boost domestic industries.

On Jan 14, Mr Biden issued an executive order to accelerate the pace at which infrastructure for artificial intelligence development can be built in the country.

“We will not let America be out-built when it comes to the technology that will define the future,” said Mr Biden in a statement.

But the roll-out of many plans will fall to incoming President-elect Donald Trump, whose return to the White House on Jan 20 promises a raft of changes to government policies.
AFP