This move is part of the Biden Administration's broader efforts to counter Chinese technological influence. The government is worried about national security risks and supply chain vulnerabilities that could come from Chinese and Russian connected car technologies in the U.S. market.
The proposed rule will target connectivity systems like Bluetooth, cellular, satellite, and Wi-Fi, as well as automated driving systems. It'll apply to technologies designed, developed, manufactured, or supplied by entities with strong ties to China or Russia.
U.S. officials are concerned these technologies could collect sensitive data about drivers and passengers. They're also worried about the potential for recording detailed information about American infrastructure. There's a fear that malicious actors could use this tech to disrupt infrastructure or vehicles.
If the rule goes through, software prohibitions will kick in for the 2027 model year. Hardware bans will start with the 2030 model year, or from January 1, 2029, for vehicles without model years. The government might make some exceptions for small automakers, but these will be rare.
Source: usembassy-china