Chinese Electric Vehicles a Security Threat to US

The Biden administration has warned that Chinese electric vehicles pose a national security threat to the US due to their ability to collect vast amounts of personal information and potentially send it overseas. US Commerce Secretary Gina Raimondo has suggested that the US should carefully consider whether all data collected by electric and autonomous vehicles should be sent to China.

This comes after Bloomberg reported that the White House is preparing an executive order to prevent foreign adversaries from accessing “highly sensitive” individual data. A Commerce Department official stated that Raimondo’s comments were unrelated to the executive order and were focused on new technology areas from a national security perspective.

Chinese columnist Ruan Jiaqi criticized Raimondo for maliciously defaming China’s EV makers, claiming that EVs made by Chinese firms like BYD have already received strong market responses in Europe and Latin America but have not entered the US market due to an additional 25% tariff imposed by the Trump administration in 2019.

The US Federal Communications Commission banned the sale of Chinese communications equipment in 2022 due to national security reasons and restricted the use of China-made video surveillance systems in US critical infrastructure. Tesla CEO Elon Musk believes Chinese electric car makers will find significant success outside of China and can demolish most global competitors if no trade barriers are established.

The Biden administration has taken measures to curb China’s EV ambitions in the US, including the publication of guidelines for federal clean vehicle tax credits established by the Inflation Reduction Act. Starting in 2024, vehicles containing battery components manufactured or assembled by a “foreign entity of concern” (China, Russia, Iran, or North Korea) will be ineligible for the tax credit. Starting in 2025, vehicles whose batteries contain certain “critical minerals” extracted or processed in these countries will also be ineligible.

The National Defense Authorization Act prevents the Defense Department from buying batteries produced by Contemporary Amperex Technology Co Ltd, Envision Energy Ltd., EVE Energy Co, Gotion High Tech Co, and Hithium Energy Storage Technology Co from October 2027, but won’t extend to commercial purchases by companies like Ford.

Ford and CATL announced a partnership in February 2023 to produce lithium-iron-phosphate batteries for Michigan-made electric vehicles (EVs). However, Ford stopped construction on the project in September due to unspecified reasons. Republican representatives Mike Gallagher and Cathy McMorris Rodgers called on the federal government to investigate alleged ties between Ford and four Chinese business partners related to the Ford-CATL battery project.

Chinese state media and commentators argue that the US will struggle to suppress China’s EV sector, as Chinese EV and battery makers have been expanding rapidly in Europe and other regions. The state-owned People’s Daily reported that Chinese and European EV sectors are highly complementary, with CATL producing EV batteries in Thuringia, Germany, and selling them to BMW, Bosch, and Mercedes-Benz Group.

China’s EV makers have successfully entered markets in Southeast Asia, Middle East, and Africa. The number of new energy vehicles (NEVs) produced in China rose 35.8% to 9.59 million units in 2022, while those sold in the country increased 37.9% to 9.5 million units.

Biden AdministrationChinaChinese communications equipmentChinese Electric VehiclesChinese Electric Vehicles a Security Threat to USElectric VehiclesEV makersNational Defense Authorization Act prevents the Defense DepartmentSecurity ThreatUnited StatesUSUS Federal Communications Commission banned