Chinese Automobiles Threaten American National Security
China’s auto industry is growing across the globe. In 2024, China’s automotive industry produced nearly 30% of all vehicles globally, and is the largest manufacturer and exporter of vehicles. China leads the electric vehicle (EV) market, and the automotive battery industry. As China continues growing its influence in the automotive industry, the U.S. faces new vulnerabilities and security threats from vehicles with connectivity software developed overseas.
New vehicles give unprecedented access about drivers to the manufacturer.
Chinese car companies are beholden to the Chinese Communist Party.
Any information they receive about Americans would likely go straight to the CCP.
Meanwhile, unfair CCP subsidies might allow their companies to dump cars in the U.S.
Congress is working on legislation to protect Americans from the CCP care threat.
Foreign Adversaries Hacking Connected Vehicles is a Growing Risk
As far back as 2016, the Federal Bureau of Investigation (FBI) has warned of the risk of remote hacking of automobiles. The research at the time found that “researchers could gain significant control over vehicle functions remotely by exploiting wireless communications vulnerabilities.” A recent American Enterprise Institute (AEI) report concluded that modern vehicles “continuously collect data on drivers, surroundings, and infrastructure,” allowing foreign adversaries to conduct surveillance of American citizens and putting national security in danger.
The report highlights just a few sensors that raise national security concerns:
Location sensors.
Audio and camera sensors.
Mapping sensors, such as automatic braking, advanced cruise control, and semiautonomous driving systems.
As a result, the personal data of Americans could be at risk of being delivered directly to car manufactures or beyond. The problem is potentially worse for vehicles used by those who work for the U.S. government, military, or critical infrastructure, could be used to threaten U.S. national security. This is why vehicles controlled by adversaries like China who have used information against us must be closely regulated.
In recognition of this threat, the Department of Commerce finalized a rule in January 2025 that “prohibits transactions involving Vehicle Connectivity System (VCS) hardware and covered software designed, developed, manufactured, or supplied by persons owned by, controlled by, or subject to the jurisdiction or direction of” China and Russia.
China’s Auto Industry is Beholden to the CCP
China’s auto industry is heavily subsidized by the Chinese government and Chinese Community Party (CCP), which not only allows these companies to underprice American-made vehicles and threaten American jobs, but also demonstrates a significant national security threat. A report found that BYD, China’s leading EV manufacturer, saw subsidy income rise from 24% in 2024 to 35% in 2025, indicating that the government has no intention of slowing down or decreasing these aggressive subsidies.
And as we noted in a previous report, Chinese lawcompels Chinese companies and citizens to cooperate with the CCP on national security work and national intelligence efforts. We found evidence of Chinese medical devices sharing sensitive data. Ultimately, any sensitive data accessible to a Chinese company or foreign national is also accessible to the CCP.
With significant portions of its income coming from the government, and an obligation to cooperate with the CCP, any Chinese automobile with connectivity software risks giving Americans’ data to a foreign adversary.
Unfair Subsidies Threaten the U.S. Auto Industry
Importing cars, especially EVs, manufactured in China poses a significant threat to American jobs and the auto industry. The Chinese government unfairly props up its EV sector with significant subsidies, making it impossible for the U.S. to compete on a level playing field.
According to a report from the Information Technology & Innovation Foundation, from 2009 to 2023, China provided $230.9 billion in subsidies to EF companies, allowing its firms “to underprice competitors in global markets.” The same report warned that opening up U.S. markets to subsidized Chinese EVs would lead to “an ‘extinction-level event’ for the U.S. auto industry.”
PAI Supports Solutions from Congress
While the federal government has taken some action to limit the risk from Chinese automobiles, software, and hardware in American vehicles, there is more that Congress can do to protect American citizens and our national security.
The Protecting American Initiative (PAI) calls on Congress to pass bipartisan legislation to prohibit the importation, manufacture, and sale of connected vehicles, software, and hardware linked to China. The Connected Vehicle Security Act (H.R. 8730/S. 4429) will:
Prevent connected vehicles from China and other foreign adversaries from entering the U.S. auto market.
Prevent software and hardware for connected vehicles from China and other foreign adversaries from being used in American vehicles.
Directs the Department of Commerce to establish processes for industry compliance.
Puts in place a civil penalty of $1.5 million or more for any violation.
As China’s influence and market share in the global auto industry continues to increase, now is the time for lawmakers to take decisive action to protect our national security.