The outgoing Biden administration has finalized on Tuesday, January 14th, a ban on Chinese components in connected vehicles that could all but bar imports to the U.S. market from companies such as Xpeng (XPEV), Geely (GELYF) and BYD (BYDDY).
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Citing national security worries, the Commerce Department said it would ban from 2030 the import of Chinese and Russian vehicle connectivity system hardware, including Bluetooth, cellular and satellite components. A ban on automated driving software from the two countries would take effect with 2027 models.
The ban finalizes a proposal from September to ban all China-made vehicles from the U.S. market over spying fears.
“It’s really important because we don’t want two million Chinese cars on the road and then realize … we have a threat,” Commerce Secretary Gina Raimondo told Reuters.
However, the final draft exempts vehicles heavier than 10,000 pounds, which may let BYDDY continue to assemble electric buses in California.
The latest moves come after the White House in September hiked tariffs on China-made electric vehicles (EVs) to 100%.
China EV Market to Slow, BYDDY Sales Forecast Up 14%
Washington is concerned that China is already producing too many EVs for its own market to absorb, and it’s going to slow further.
EV sales in China rose 42% last year to nearly 11 million units, according to the China Passenger Car Association, with BYDDY’s NEV sales soaring by more than 40% to nearly 4.3 million units.
However, HSBC analysts forecast growth to slow to 20%, while BYD unit sales growth will falter to around 14%, CNBC reports.
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