Mexico’s Concerns over Proposed Ban on Chinese Car Tech

Mexico’s Concerns over Proposed Ban on Chinese Car Tech
The Mexican government has expressed alarm over the Biden administration’s plan to ban essential Chinese software and hardware from connected vehicles operating on American roads due to national security worries. Mexico’s economy ministry contends that the proposal “could have a significant impact on Mexico’s automotive industry” by potentially disrupting supply chains, raising production costs, and jeopardizing employment.
Industry Requests for Time Extensions
Additionally, automaker and tech organizations have implored the administration to modify and extend implementation deadlines for the rule. The Alliance for Automotive Innovation, representing major manufacturers such as General Motors and Toyota, requested an additional year to meet hardware requirements. The Consumer Technology Association and Honda Motor also sought two-year extensions to conduct necessary testing and contract updates.
Impact on Chinese Vehicle Imports
The Biden administration’s proposal significantly escalates limitations on Chinese vehicles, software, and components in the United States. If implemented, it would essentially prohibit the importation of Chinese brand vehicles, even if they were assembled in Mexico. The move follows steep tariff increases on Chinese imports initiated by the administration in September, including a 100% duty on electric vehicles.
Compliance Deadlines
According to the proposal, software restrictions would go into effect for the 2027 model year, while hardware prohibitions would apply in the 2030 model year or January 2029. The Commerce Department aims to finalize the proposal by January 20th, 2023.
Scope of the Proposed Rule
The proposed rule applies to all on-road vehicles but excludes agricultural or mining vehicles not used on public roads, as well as drones and trains. The Commerce Department did not offer immediate comment on Mexico’s concerns or the industry’s requests for modifications.