US, allies discuss new restrictions on Chinese connected vehicles

As the US government intensifies efforts to regulate Chinese technology in connected vehicles over national security concerns, South Korea and other key allies are coordinating to balance these security goals with potential supply chain disruptions.

The US State Department convened a meeting Wednesday with representatives from allied governments and industry leaders, including officials from South Korea, Australia, Canada, the European Union, Germany, India, Japan, Spain and the United Kingdom. The goal was to find ways to safeguard critical infrastructure without stifling innovation.

Connected vehicles are part of a broader network that includes personal devices and telecommunications networks. This makes them crucial nodes in critical infrastructure, and their security is paramount. Connected cars can communicate with traffic signals, other vehicles and even home automation systems. While this can lead to smoother commutes and enhanced safety, it also creates potential entry points for cyberattacks.

The backdrop to this meeting is an ongoing investigation by the US Commerce Department into the supply chain of information and communications technology and services for connected vehicles. Launched by President Joe Biden on Feb. 29, this probe focuses on the risks associated with using technology from countries deemed a security concern, such as China. The primary concern is that integrating Chinese technology into these vehicles could lead to hacking or data breaches, compromising both individual safety and national security.

Although China was not explicitly mentioned in the State Department’s press release, the meeting is widely viewed as an effort to secure cooperation from allies and major automakers as the US considers regulating Chinese technology in connected vehicles.

Industry analysts suggest that the US might eventually restrict the import of connected vehicles utilizing Chinese technology or parts. This poses a challenge for Korea’s automotive industry, which relies on certain Chinese components for its vehicles.

Korean government and industry officials have requested a grace period for any specific measures considering their impact on supply chain disruptions. While US regulations primarily target complete vehicles, there is concern that Chinese-made components in Korean cars could be affected if deemed crucial to data collection and transmission processes.

The broad definition of “connected vehicles” -- encompassing any vehicle with navigation or wireless software or services that communicates with external systems -- means numerous China-sourced components used in Korean vehicles, such as telematics control units and wireless communication modules, might fall under new US regulations.

No specific measures are said to have been discussed during Wednesday’s meeting. A tentative draft of the bill is likely to be unveiled in September, according to news reports.