New Delhi

The United States Commerce Department is preparing to take significant action regarding connected vehicles and certain software originating from China and other countries deemed adversarial. Alan Estevez, the department's export controls chief, announced at a forum in Colorado that proposed rules on this matter are expected to be issued next month.

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Estevez elaborated that the focus would be on specific components and software, rather than entire vehicles. The primary concern is centred on key driver components that manage software and data within the vehicle. The proposed rules would likely require these critical elements to be manufactured in allied countries, reflecting the U.S. government's growing concerns about national security risks associated with technology from certain nations.

This announcement follows earlier statements by Commerce Secretary Gina Raimondo, who in May had indicated that the department was planning to propose rules on Chinese-connected vehicles in the autumn. Raimondo had also suggested that the Biden administration might consider "extreme action," potentially including bans or strict restrictions on Chinese-connected vehicles. These considerations stem from a probe launched by the administration in February to assess the national security risks posed by Chinese vehicle imports.

Estevez's recent comments provide the most concrete information to date about the administration's intentions regarding Chinese vehicles, a topic that has sparked widespread concern in various sectors. The focus on connected cars is particularly noteworthy. These vehicles are equipped with integrated network hardware that enables internet access, allowing them to share data both internally and externally.

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The undersecretary emphasised the severity of the potential threat posed by connected vehicles. He pointed out the extensive amount of personal data that modern cars can collect and store. "A car is a very scary thing. Your car knows a lot about you," Estevez stated. He went on to describe how contemporary vehicles, whether electric or combustion-engine-powered, regularly receive software updates and are capable of capturing a wealth of information. This includes taking pictures, tracking driving patterns, connecting to personal phones, logging call histories, and monitoring travel destinations.

In response to these concerns, the Chinese foreign ministry has previously called on the United States to adhere to market economy principles and fair competition. They argue that the global popularity of Chinese cars is a result of intense market competition and technological innovation, rather than any unfair practices or security threats.

Secretary Raimondo had previously highlighted the potential catastrophic consequences if the software in millions of cars on American roads were to be disabled. This scenario underscores the administration's concerns about the vulnerability of connected vehicles to potential foreign interference or control.

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There are relatively few imports of Chinese-made light-duty vehicles in the United States. However, the Biden administration has proposed significant increases in tariffs on Chinese electric vehicles and other goods, with these changes expected to take effect by August 1st.

This developing situation reflects the complex interplay between technological advancement, international trade, and national security concerns in the modern automotive industry. As connected and autonomous vehicles become increasingly prevalent, policymakers are grappling with how to balance innovation and economic interests with potential security risks, particularly those associated with technology from countries deemed adversarial to the United States.