What just happened? President Biden has ordered an investigation into whether Chinese connected vehicles, particularly EVs, pose a security risk to American citizens. It comes amid concerns that cheap EVs from China could flood the US market, which would have a major impact on domestic car makers.
The White House notes that the US Commerce Department probe is needed because vehicles collect large amounts of sensitive data on their drivers and passengers, while regularly using their cameras and sensors to record detailed information on US citizens and infrastructure - information that could be sent back to China.
Biden said the move was designed to ensure America maintained control of what he called its "dynamic auto industry."
The probe will also look into vehicles with autonomous driving features as they could be piloted or disabled remotely, the White House added.
"China is determined to dominate the future of the auto market, including by using unfair practices," Biden said, comparing the connected vehicles to smartphones on wheels. "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."
"China imposes restrictions on American autos and other foreign autos operating in China," Biden added. "Why should connected vehicles from China be allowed to operate in our country without safeguards?"
China was responsible for 69% of all new EV sales globally in December, selling around nine million EVs across the whole year. In the US, 1.2 million vehicle buyers went electric in 2023.
There are few Chinese-made vehicles being imported into the US, but the Biden administration says it is acting before they become more widespread. BYD, which recently overtook Tesla to become the world's largest EV maker by sales, said it does not plan to sell its cars in the US. However, the company is opening a production facility in Mexico, prompting fears that the EV's could be imported from the country.
The Chinese embassy in Washington said it urged the US to stop the discriminatory suppression of Chinese companies, respect the laws of market economy, and stop overstretching the concept of national security.
The Biden administration added that the probe could result in restrictions being applied to American-made EVs that rely on Chinese-made software in their infotainment systems. It might also impact companies with Chinese owners, such as Lotus and Volvo.
Back in September, a study by the Mozilla Foundation declared that modern cars are a privacy nightmare. Its study found that of the 25 car brands examined, all of them collected too much personal data and used it for reasons other than to operate a vehicle and manage the relationship with the customer. Tesla was ranked the worst offender.