U.S. automakers want Congress to permanently restrict Chinese connected vehicles, software and hardware.
Bipartisan legislation targeting Chinese automotive technology is advancing in both chambers of Congress.
Proposed ownership restrictions could also affect global automakers with significant Chinese shareholders.
The U.S. auto industry’s leading trade association is urging Congress to establish permanent restrictions on Chinese connected vehicles and related technologies before the current congressional session ends.
In a Sept. 3 letter to congressional leaders, Alliance for Automotive Innovation called for legislation preventing the sale, import and manufacture of Chinese connected vehicles, hardware and software in the United States.
The organization represents automakers producing most vehicles sold in the U.S., along with major suppliers, battery producers, semiconductor companies, technology businesses and autonomous-vehicle developers.
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The Alliance linked the request to concerns about China’s industrial policies, including government subsidies, trade practices, intellectual property and vehicle data. They argued that Chinese automakers are gaining market share in regions including Europe, Australia, Southeast Asia, Mexico and South America while deploying increasingly connected vehicles.
The letter also positioned the issue as a manufacturing and national-security priority. Alliance for Automotive Innovation said the U.S. automotive sector supports 11 million jobs across all 50 states and contributes nearly US$1.5 trillion to the American economy annually.
Congress already has several proposals under consideration.
In July, the Senate Commerce Committee approved the Connected Vehicle Security Act of 2026, S. 4429. The proposal would restrict Chinese connected vehicles and associated software and hardware. A House version, H.R. 8730, introduced by Michigan representatives John Moolenaar and Debbie Dingell, has attracted bipartisan support.
Another proposal, the Motor Vehicle Modernization Act, H.R. 7389, advanced through the House Energy and Commerce Committee in May. A provision in that legislation would prevent designated foreign adversaries, including China, from manufacturing, importing or introducing vehicles into U.S. interstate commerce.
The details could have consequences beyond Chinese automotive brands. Proposed ownership thresholds have raised questions for global manufacturers with significant Chinese shareholders. Mercedes-Benz, for example, has Chinese investors holding nearly one-fifth of its shares. Another example is Geely-owned Polestar, which is banned from selling new cars from next year. Might Volvo be next?
The Alliance acknowledged that lawmakers are still working through the scope of the restrictions and said the industry wants a policy that allows its members to continue operating successfully in the U.S.
Canada, as we know, has gone in the completely opposite direction, welcoming Chinese vehicles and automakers with relatively open arms. The contradictory approaches add another potential layer to North American vehicle policy. Closely integrated Canadian and U.S. automotive manufacturing means major American restrictions on vehicles, components, or software could affect future Canadian trade and supply-chain decisions.
Source: The Hill
