US Pushes Ban on Chinese, Russian Tech in Connected Vehicles

The Biden administration took steps Monday to ban Chinese connected vehicle hardware and software from reaching the U.S. market, warning Monday of escalating foreign threats to the information and communications technology supply chain.

See Also: SASE: Recognizing the Challenges of Securing a Hybrid Workforce

The Department of Commerce published a notice of proposed rulemaking that would prohibit car manufacturers from importing hardware or software from the People’s Republic of China or Russia that enables vehicles to connect to networks, or communicate with other devices and share data. The proposed rules also seek public feedback on whether other foreign adversaries such as Iran pose similar national security risks to the ICTS supply chain.

Commerce said China and Russia could gain privileged access to connected vehicles through their components and software to “exfiltrate sensitive data” and potentially “allow remote access and manipulation of connected vehicles.” Research cited in the proposed rule shows a sharp rise in remote cyberattacks in recent years, with 95% of all malicious activities in 2023 exploiting network connectivity like WiFi and Bluetooth.

Chinese car makers – in particular, electric vehicle manufacturers – have aggressively expanded overseas, becoming the world’s second larger automobile exporters in 2023, just shy of Japanese auto firms. Although the market for Chinese cars lies mostly outside the United States, in Russia and Latin America, the expansion has proved fraught for American policymakers concerned that modern automobiles loaded with onboard computers offer Beijing an easy avenue into surveilling users and critical infrastructure or even jamming up roads.

Vehicle systems with Chinese or Russian software could be exploited to spread malware or inject malicious code into a vehicle’s operational systems, according to the proposed rules. Commerce also said foreign adversaries could use remote access to vehicles in the United States “to trigger improper engine shutdown, brake activation or electrical system deactivation.”

Lael Brainard, director of the White House’s National Economic Council, said the proposed rules are additionally an effort “to avoid a second China shock,” referring to the economic disruption in the U.S. caused by China’s rapid rise as a global manufacturing powerhouse in the early 2000s.

“China is flooding global markets with a wave of auto exports at a time when they are experiencing overcapacity,” Brainard said during a speech at the Detroit Economic Club. “The administration is determined to avoid a second China shock, which means putting safeguards in place before a flood of underpriced Chinese autos undercuts the ability of the U.S. auto sector to compete on the global stage.”

“Americans should drive whatever car they choose – gas powered, hybrid, or electric,” she added. “But, if they choose to drive an EV, we want it to be made in America, not in China.”

The Commerce Department is requesting public feedback from stakeholders by October 23.