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Post: Biden Targets Chinese Electric Cars Over National Security Concerns: A New Front in Tech and Trade Tensions
Biden Targets Chinese Electric Cars Over National Security Concerns: A New Front in Tech and Trade Tensions. President Biden has flagged Chinese electric vehicles (E.V.s) as a national security concern, prompting an investigation into their technology that can monitor U.S. drivers. This move is part of a wider strategy to curb the import of E.V.s and other smart cars from China. On Thursday, President Biden initiated steps to potentially block the entry of internet-connected Chinese cars and trucks, including E.V.s, into the U.S. auto market, citing the risk they pose due to their ability to send sensitive data to Beijing.
The Commerce Department has started an investigation into these security threats, which may lead to the imposition of new regulations or restrictions on Chinese vehicles.
The administration is exploring a comprehensive range of policy measures aimed at preventing the influx of inexpensive Chinese electric vehicles, produced in China or by Chinese firms in countries like Mexico, from overwhelming the U.S. market and threatening the viability of domestic auto manufacturers.
China’s aggressive expansion of its electric vehicle production positions it in direct competition with President Biden’s policies to bolster American automakers both domestically and internationally. Some of China’s compact cars are sold for under $11,000, a price significantly lower than that of a similar American-made E.V.
The actions taken on Thursday are set against the backdrop of Biden’s potential electoral face-off with former President Donald J. Trump, who has been critical of Biden’s push towards electric vehicles, with both candidates vying to project a tough stance on China.
Biden Targets Chinese Electric Cars Over National Security Concerns: A New Front in Tech and Trade Tensions
The measures follow discussions with Detroit’s auto industry, unionized auto workers, and Tesla, recently overtaken by Chinese company BYD as the leading electric car seller worldwide.
President Biden, emphasizing the unfair practices China is employing to dominate the auto market’s future, stated, “China’s policies could flood our market with its vehicles, posing risks to our national security. I’m not going to let that happen on my watch.”
Though immediate barriers were not established against Chinese E.V.s, which are already subject to high tariffs and have not made significant inroads into the American clean energy car market, the Commerce Department’s investigation will scrutinize the potential threat from technology in Chinese E.V.s, such as automotive software that could track American users’ movements and preferences.
This investigation is part of Biden’s broader initiative to tighten technology restrictions on China, continuing the trend of increasingly antagonistic trade relations. The Commerce Department’s inquiry, initiated under Biden’s direction, is the first application of a new power granted by an executive order from 2019 by Trump.
The inquiry might lead to new U.S. restrictions on vehicles reliant on Chinese software, with further actions being considered to curb Chinese vehicle imports, already popular in European markets due to lower prices and labor costs. This could mean an increase from the existing 25 percent tariff on Chinese vehicles.
The investigation stemmed from dialogues with automakers about the challenges they face in the Chinese market, particularly regarding software restrictions.
Administration officials, concerned about the implications of unchecked Chinese software use in the U.S., are considering various policies to ensure competitiveness for American carmakers and workers.
The Treasury Department has proposed rules to limit China’s role in supplying materials for vehicles eligible for a $7,500 electric vehicle tax credit under Biden’s climate legislation.
The Commerce Department’s investigation reflects concerns about Chinese vehicles’ potential to collect extensive data through their continuous connection to U.S. infrastructure, raising espionage and cyber risks. While the immediate focus is on software issues, the broader objective is to bolster the U.S. auto industry and national security.
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