Biden orders investigation into potential 'security threats' from Chinese electric vehicles.

President Joe Biden has initiated an investigation into whether Chinese "connected" vehicles, particularly electric cars, pose a security risk to the United States. The move comes amid concerns about China's influence in the US auto market and potential national security risks associated with the export of these vehicles. The investigation will be conducted by the commerce department to determine appropriate measures to safeguard national security.

Concerns and Motivation: Biden expressed concern about China's efforts to dominate the global auto market, including using what he referred to as "unfair practices." The president emphasized that the majority of cars are now "connected," akin to "smartphones on wheels." He voiced worries that Chinese vehicles could collect sensitive data about US citizens and infrastructure, raising the possibility of data being sent back to China, enabling remote access by the Chinese government.

Security Implications: US commerce secretary Gina Raimondo highlighted the significant data collection capabilities of "connected" cars, ranging from driving routes to biometric information. The potential misuse of such information by foreign adversaries, particularly China, poses risks to national security and the privacy of US citizens. Concerns include the possibility of data being accessed at scale, leading to security and privacy breaches.

Action Taken: The investigation aims to determine appropriate actions to prevent China from undermining national security through the export of "connected" vehicles. White House national economic adviser Lael Brainard pointed out China's restrictions on connected vehicles operating within its borders, limiting software usage and data provision to Chinese entities.

Diplomatic Response: The Chinese embassy in Washington criticized the investigation, viewing it as discriminatory. The embassy spokesperson urged the US to halt the investigation, avoid similar inquiries, and refrain from creating obstacles to normal economic and trade activities. The investigation's timing, amid Biden's re-election campaign and previous China-related trade issues, adds a political dimension to the situation.

Industry Impact: While it is too early to determine the investigation's impact on companies like Tesla, which manufactures electric vehicles (EVs) in China, there are broader concerns about China's industrial overcapacity and potential dumping of products, including EVs, on international markets. Experts are awaiting possible restructuring of tariffs on Chinese imports related to EVs.

Conclusion: Biden's decision to investigate potential security threats from Chinese "connected" vehicles reflects broader efforts to address national security risks associated with technology and data. The move underscores the delicate balance between economic considerations, diplomatic relations, and safeguarding critical information in an interconnected global market.