America to Ban Chinese Technology in Vehicles

U.S. officials have revealed that they are planning to ban the use of Chinese and Russian technology in vehicles manufactured in the country. This ban would prevent certain software and hardware developed in both Russia and China from being deployed in American-made cars, buses and trucks to minimize apparent security risks.

According to the officials, they fear that Chinese and Russian technologies used to connect vehicles to other networks and facilitate autonomous driving could grant enemies remote access to vehicles running on U.S. roads. Although the U.S. automobile industry rarely uses software made in China and Russia, Commerce Secretary Gina Raimondo says the proposed ban is a targeted, proactive measure designed to protect the country.

Vehicles have become increasingly high-tech in recent years and now feature everything from GPS tracking, microphones and cameras to various internet-connected technologies, Raimondo said in a recent statement. Adversaries could potentially gain access to all the information that’s available through these technologies, the official said, putting citizens’ privacy and national security at risk.

As expected, Beijing isn’t happy with Washington’s decision to keep Chinese tech away from America’s vehicle industry. Chinese officials argue that the United States is widening the “concept of national security” to target Chinese companies unfairly. Foreign Ministry spokesperson Lin Jian emphasized that China opposed the discriminatory action which Washington is taking against Chinese companies and products.

Furthermore, Jian said that China is urging the U.S. to abide by global market principles and ensure Chinese companies have access to a nondiscriminatory and fair business environment. With China essentially locked out of the U.S. EV market, the recent proposal to ban its technology will also cut the east Asian nation out of America’s general vehicle market.

The announcement comes several weeks after the U.S. placed a 100% import tariff on electric cars manufactured in China to protect the local automotive sector. Now that Canadian authorities have also imposed a similar tariff on Chinese-made electric cars, China is essentially locked out of the North American EV market.

The Biden administration is working hard to keep China out of its burgeoning electric vehicle industry, especially since China has monopolized the global EV supply chain over the past decade. Aside from this proposal, the White House has also increased tariffs on Chinese EVs, electric vehicle batteries and various other products. It has also outlawed the importation of cargo cranes made in China due to supposed cybersecurity risks.

Chinese entities such as Kandi Technologies Group Inc. (NASDAQ: KNDI) will now have a harder time hitting their sales targets, given the stance that the United States is taking against EVs and auto technology from China.

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