Automakers urge Congress to quickly pass law banning Chinese cars

WASHINGTON — A group representing major automakers on Thursday (Sept 3) urged Congress to pass legislation permanently barring Chinese vehicles from the US market before the end of the year.

The Alliance for Automotive Innovation, which represents General Motors, Ford, Toyota, Volkswagen, Hyundai, Honda, Stellantis and other major automakers, called for quick action.

"Right now, Chinese automakers are dumping subsidized vehicles with connected software and hardware around the world," the group's CEO John Bozzella wrote Congress in a letter seen by Reuters. 

"This hasn't happened inside the US yet, but given the scale and urgency of this threat, we urge you to enact a Chinese vehicle, software and hardware ban before adjourning this year and make this policy the law of the land."

In July, the Senate Commerce Committee approved legislation to toughen a government ‌ban on Chinese automakers entering the American market, but it still faces hurdles to winning final passage.

Bozzella said passing the bill "will send a clear and bipartisan message that China's strategy to dominate global automotive manufacturing will be met with a national security response from the American government."

The Chinese embassy in Washington said it opposed the effort and said Beijing has abolished market access restrictions on foreign investment in manufacturing "and remains open to international car makers who can fully share in the dividends of China's big market. Tesla, Buick, Toyota, and Ford have been household names in China".

The Alliance in July urged the committee to consider as part of the legislation explicitly prohibiting the Commerce Department from granting specific authorisations to Chinese automakers such as "BYD, Chery, SAIC Motor and others subsidized by the Chinese Communist Party to manufacture, sell or import connected vehicles to the US", according to a previously unreported letter.

Republican Senator Bernie Moreno of Ohio and Senator Elissa Slotkin, a Michigan Democrat, proposed legislation to codify a regulation imposed by the ​Biden administration that effectively bans all Chinese automakers from selling or building passenger vehicles in the US and takes other steps to prevent China from ​entering the US light-duty market.

Senate Commerce Committee Chair Ted Cruz said a provision in the bill that would ban companies with more than 15 per cent ownership by Chinese entities would bar Mercedes-Benz from selling vehicles in the ​US because of its nearly 20 per cent passive Chinese investment. Cruz said the bill required changes before it could become law.

In June, Polestar said the Trump administration was forcing the electric-vehicle maker to stop selling vehicles in the US beginning in the 2027 model year. The Sweden-based company is majority-owned by China's Geely Holding.

Bluetooth, Wi-Fi, cellular connectivity and some satellite communications technologies are covered under the rules based on national security concerns linked to the ability ​of vehicles to collect sensitive data on American owners.

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