The legislation bans ‘connected vehicles’ with software or hardware linked to China, Russia, Iran, and North Korea over their national security risk.
The U.S. Senate Commerce Committee unanimously advanced legislation to ban China-linked smart vehicles in America on July 22.
The bipartisan legislation, called the Connected Vehicle Security Act of 2026, for which an identical version is being considered in the House, would codify into law a Biden-era executive order that effectively banned all Chinese and Russian automakers from selling passenger vehicles in the United States.
The rule targeted “connected vehicles” that contain software or hardware linked to China or Russia, citing national security risks over vulnerabilities that could allow a U.S. adversary to access driver information or gain control of a vehicle. Almost all new vehicles come equipped with connectivity devices.
Lawmakers said they are pursuing similar legislation in Congress to close loopholes in the federal rule. Sponsored by Sens. Bernie Moreno (R-Ohio) and Elissa Slotkin (D-Mich.), the legislation now removes light-vehicle weight limits and extends the ban on China and Russia to include Iran and North Korea.
Additionally, it now encompasses not only entities fully “owned by, controlled by, or subject to the jurisdiction or direction” of U.S. adversaries but also those partially exposed, with a 15 percent threshold for vehicle manufacturers and a 25 percent threshold for software developers and hardware manufacturers.
The bill outlines a minimum civil penalty of $1.5 million or five times the transaction value per violation. It would come into effect in two phases, with limits on internet-connected vehicles and related software taking effect in 2027, followed by hardware-related restrictions around 2030.
The proposed law also targets communist China’s rapid expansion of its automotive manufacturing capacity, which has seen nearly 8 million Chinese-made vehicles flood the global market annually, hurting American manufacturers.
“The Chinese Communist Party’s playbook of heavily subsidizing their product and underselling the competition puts Michigan’s auto industry and millions of American workers at risk,” Slotkin said.
“We’re preventing an absolute, total, and complete destruction of our industrial base,” Moreno added.
According to Slotkin’s office, the legislation “closes the door on Chinese-origin vehicles, software, and key components at every stage, from production, importation, to sale, so that data gathered on U.S. roads can’t be funneled back to the Chinese government.”
Unions and automakers have expressed their support for Congress’s efforts to protect America’s manufacturing capacity.
By Melanie Sun
