On the Dash:
- The proposed legislation would reinforce barriers preventing Chinese automakers from entering the U.S. retail market.
- Dealers should continue to monitor federal policy as national security becomes a greater factor in automotive trade decisions.
- Restrictions on Chinese-connected vehicle technology could influence future sourcing, software and supply chain strategies across the industry.
The Senate Commerce Committee will vote July 15 on bipartisan legislation aimed at permanently strengthening restrictions that prevent Chinese automakers from entering the U.S. passenger vehicle market. Ohio Senator Bernie Moreno and Elissa Slotkin (D-Mich.) introduced the legislation in April.
The bill, the Connected Vehicle Security Act of 2026, would codify a rule the Biden administration issued in January 2025, which blocks Chinese automakers from selling connected passenger vehicles in the U.S. However, lawmakers argue the measure addresses national security risks posed by vehicle software and connected technologies that can collect sensitive driver data.
Specifically, the legislation would prohibit the sale of vehicles designed in China with advanced connectivity systems or vehicle software. House lawmakers have introduced companion legislation with similar provisions.
In March, major automakers, suppliers and dealer organizations urged the federal government to maintain restrictions on Chinese automakers. The coalition contends Chinese manufacturers pose risks to U.S. national security, the domestic automotive industry and long-term competitiveness.
Global context adds pressure
Chinese vehicles remain largely absent from the U.S. market, but they’re gaining market share in Europe and Mexico. Consumer interest in lower-priced Chinese electric vehicles is also growing despite existing tariffs.
Last month, Swedish automaker Polestar announced it will leave the U.S. market for future model-year vehicles following the Trump administration’s expanded restrictions on Chinese-built and Chinese-connected vehicles.
