US prepares to ban Chinese, Russian software in connected vehicles over security fears

The US Commerce Department is planning to reveal proposed rules that would ban Chinese- and Russian-made hardware and software for connected vehicles as soon as Monday, said people familiar with the matter.

Commerce has been meeting with industry experts in recent months looking to address security concerns raised by a new generation of so-called smart cars. The move would include bans on use and testing of Chinese and Russian technology for automated driving systems and vehicle communications systems, the people said. While the bans mostly focus on software, the proposed rules will include some hardware, they said.

Many of today’s cars – both gas and electric – are equipped with devices connecting them to the internet or cloud services, making them potential targets for hacking. The pending restrictions stem from an investigation of cybersecurity risks from Chinese vehicle software that President Joe Biden launched in March.

The Biden administration’s primary concern is preventing China or Russia from hacking vehicles or tracking cars by intercepting communication with software systems that their domestic companies have created. The rules would also have a protectionist element since most new cars are connected at least through infotainment systems, so Chinese carmakers could be barred from selling in the US if the vehicles use their connected technology.

In May, the administration levied a 100 per cent tariff on Chinese electric vehicles, pointing out its government is subsidising its auto industry and increasingly exporting its excess capacity at a time when US companies are building more battery-powered cars.

The Commerce Department declined to comment.

Lael Brainard, director of the White House’s National Economic Council, is set to speak on Monday in Detroit about the Biden administration’s efforts to “strengthen the US auto industry”.