The US Commerce Department is going to propose a sweeping ban on Chinese software and hardware in connected and autonomous vehicles due to national security concerns. This is a big deal in the US-China trade war. The proposed ban which will be formalized in the next few weeks will block the use of Chinese made components or software in cars with advanced driver assistance systems (ADAS) or autonomous driving capabilities. These systems are heavily dependent on connected tech that can be hacked and breached.
The Biden administration is worried that Chinese companies could use the vast amount of data collected by connected vehicles to compromise US infrastructure or manipulate driver behavior. “Cars are basically smartphones on wheels” Commerce Secretary Gina Raimondo said, on the risks of foreign control of this technology.
The rule would prohibit the import and sale of vehicles with certain Chinese made software or hardware. This includes components that enable internet connectivity like telematics control units, Bluetooth modules and satellite navigation systems. Assisted driving systems would also be included in the ban.
Trend Micro’s report found connected cars are vulnerable to cyber threats. The report said these systems are often not well secured and can be easily hacked and attackers can take control of the car or steal data.
While the Chinese government has denied allegations of cyber espionage or malicious activity, US officials have pointed to many instances of Chinese hacking of critical infrastructure and government agencies. These attacks have raised concerns about Chinese tech being used for espionage or sabotage.
While the amount of Chinese software used in US vehicles is small, the rule would require automakers to make big changes to their supply chains by 2027. This is part of the broader US effort to limit Chinese imports and reduce dependence on foreign technology.
But automakers and industry groups will likely push back saying it will disrupt supply chains, increase costs and slow down development of new vehicle tech. The rule will go into public comment and we’ll see how the industry reacts.
The proposed ban on Chinese tech in connected cars will likely face opposition from domestic and foreign interests. The Chinese government has already spoken out against the move calling it discriminatory and protectionist. Some industry experts are also worried about the economic impact of the ban, saying it will disrupt supply chains and cost consumers more.
But supporters of the ban say the risks of Chinese tech outweigh any economic costs. They say national security has to come before short term economic gains and the long term cost of a cyber attack on critical infrastructure would be far greater than any temporary disruption to the auto industry.
As the US government moves forward with the proposed ban it will be under intense pressure from domestic and international stakeholders. The outcome of this will have big implications for connected cars and the broader US-China tech war.
