{"id":452915,"date":"2026-02-06T17:59:10","date_gmt":"2026-02-06T17:59:10","guid":{"rendered":"https:\/\/www.newsbeep.com\/us\/452915\/"},"modified":"2026-02-06T17:59:10","modified_gmt":"2026-02-06T17:59:10","slug":"can-chinas-no-2-automaker-make-it-in-america","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us\/452915\/","title":{"rendered":"Can China\u2019s No. 2 automaker make it in America?"},"content":{"rendered":"

Is the long freeze on Chinese automakers selling cars in the US finally starting to thaw? China is the largest auto market in the world and now the largest car exporter, too. But high tariffs and geopolitical tensions have kept Chinese automakers away from US customers. Many of those cars are ready for primetime<\/a> and are fully competitive with current offerings in the United States.<\/p>\n

Geely is among those Chinese carmakers that want to sell their cars here. It\u2019s already sailed past one of two hurdles any of them need to clear to do that: Its Volvo Cars division already has an assembly plant in South Carolina that would let it build its cars domestically. That plant now builds the Volvo EX90 electric SUV and the Polestar 3 that shares its platform; it will add the Volvo XC60 late this year.<\/p>\n

Few US buyers realize it, but Geely has controlled the Swedish automaker for more than 15 years. Is the Volvo factory a possible foothold for Geely\u2019s future in the US?<\/p>\n

Software from \u201ccountries of concern\u201d<\/p>\n

The challenge for Geely is that any Chinese company selling cars in the US must certify that all software for autonomous driving, and all hardware and software for connectivity and telematics, has not been developed in or controlled by a \u201ccountry of concern\u201d (China or Russia). Those strictures sit within a Commerce Department rule<\/a> that took effect in March 2025; it\u2019s intended to protect the country from hostile use of advanced auto technologies by adversary countries.<\/p>\n

Initiated by Joe Biden\u2019s administration, the rule was finalized by Donald Trump\u2019s second administration. The provisions on software take effect next month for cars in model years 2027 and later. The hardware ban follows in three years, starting with model year 2030 cars. The bans sought to avert several types of national security risk<\/a>.<\/p>\n

Is the Volvo factory a possible foothold for Geely\u2019s future in the US?<\/p>\n

One goal was to prevent an adversary government from gaining access to the cars via telematics to control their movements \u2014 whether taking over the driving remotely or mass-disabling them. Another was to ensure the vehicles could not gather personally identifiable information on people of interest in the US (corporate executives, members of the military, celebrities, and more). The fear is that the vehicles could record voice and facial recognition data, their travel patterns, their contacts, their phone calls, and much more \u2014 all of which could be used to train artificial intelligence programs. A final goal, broadly, was to prevent vehicles produced by makers in those countries from capturing detailed images and data on US roads and the built environment through which the cars traveled.<\/p>\n

Sam Abuelsamid, vice president of market research at Telemetry, takes a more jaundiced view of this risk. The actions it guards against are \u201ca very inefficient way of spying,\u201d he said, as compared to spy satellites, mobile-phone data, and commercial map data. For all the risks cited, he suggested Americans should be far more concerned about the \u201cdata being gathered by Flock<\/a> and Palantir<\/a> than anything Chinese cars might send to Beijing.\u201d<\/p>\n

Avery Ash, CEO of Securing America\u2019s Future Energy, or SAFE, emphasized the rules were established solely for reasons of national security, and are not concerned with national economic competitiveness. SAFE is a nonprofit think tank that advocates and lobbies for policies that reduce the US dependence on oil; it sees connected, autonomous EVs as an important pathway toward that goal. Data storage locations and governance remain concerns, Ash said, so the rules take a very broad look at what constitutes \u201ccontrol\u201d by a Chinese entity. Where the software was designed is irrelevant; it\u2019s about effective control of the company that wrote it and the firms that designed the hardware it runs on.<\/p>\n

The rules do not \u201ccover Chinese software developed before the new rules took effect, so long as it was not being maintained by a Chinese firm,\u201d according to the Commerce Department<\/a>. But, Ash noted, any updates to grandfathered software happening after the effective date would fall under the new rules.<\/p>\n

The ban on Chinese vehicle software leads inevitably to the question of Volvo. The public face of the company is entirely Swedish, but Geely has controlled 80 to 100 percent of the company since 2010. Sources who attended last year\u2019s hearings on the Commerce rules felt Volvo may be able to find a way to address the department\u2019s concerns. Since it\u2019s seen as a European carmaker and a household name in the US, it will likely be able to continue building and selling cars here.<\/p>\n

Indeed, those sources suggested, Volvo is likely already in talks with Commerce about its future vehicle plans, the software in those vehicles, and what it would take to get explicit approvals that certify it adheres to the rules for each model year of every model it sells.<\/p>\n

Where the software was designed is irrelevant; it\u2019s about effective control of the company that wrote it and the firms that designed the hardware it runs on.<\/p>\n

\u201cVolvo Cars follows government rules in all markets where we operate and is committed to working with US Commerce on the technical aspects of the rule,\u201d company spokesperson Thomas McIntyre Schultz said in a statement. \u201cWe are having a productive dialogue with the Department of Commerce which is ongoing.\u201d<\/p>\n

To date, Ash said, no waivers to the rules have been issued. Any company that wanted one would have to request a \u201cspecific authorization\u201d for vehicles, software, and\/or components that would otherwise be barred \u2014 and a separate authorization is required for each separate model, for each model year. Companies self-document and self-attest to their compliance, he noted, but the department can review any such claims, request documentation, and test the vehicle. (This is similar to how US vehicle-emissions certification has worked for 50 years.)<\/p>\n

But if future Zeekr or Geely models use the same platforms and software as those Volvo will continue to build in the US, the Chinese company may say: We just want to put different sheet metal on the same car that\u2019s already received a waiver, and sell it under another name. That\u2019s what Polestar now does with its 3, largely a Volvo EX90 underneath. Why can\u2019t we do that?<\/p>\n

Concern arose last month when it became public that the architect of the policy, Elizabeth Cannon, recently resigned as executive director of the Office of Information and Communications Technology and Services in the Commerce Department. (Reuters reported she was \u201cpushed out<\/a>\u201d by the Trump administration.) White House spokesperson Kush Desai subsequently told The Atlantic<\/a> Cannon\u2019s departure \u201cshould not be read that deeply into as reflective of broader Administration thinking or decision-making.\u201d<\/p>\n

That followed shortly after a new National Defense Strategy<\/a> on January 23rd that made little mention of China as an adversary. Reversing long-standing US defense policy, the new strategy uses remarkably conciliatory language toward China, focusing on \u201cmutual respect\u201d and \u201cestablishing trade.\u201d<\/p>\n

One insider echoed Desai\u2019s take, saying no evidence to date has emerged that suggests the current administration intends to ax the Commerce rules. The longer-term concern, that person said, will be whether Commerce will stick to its guns and require \u201crobust, rigorous\u201d review of the software, where it was developed, what entity controls its source code, and where all US data is stored. Will specific authorizations only be issued once those issues have been thoroughly vetted \u2014 or will Chinese makers be let off with a \u201csoft review\u201d that leaves some risks open?<\/p>\n

No evidence to date has emerged that suggests the current administration intends to ax the Commerce rules.<\/p>\n

A recent example of soft review, the source said, was the deal under which a controlling interest in TikTok\u2019s US activities<\/a> passed to a joint venture in which owner ByteDance retained a stake. While the announcement touted \u201ccomprehensive data protections, algorithm security, content moderation, and software assurances for US users,\u201d security professionals suggest significant loopholes remain<\/a>.<\/p>\n

Geely has a great deal of work to do before it can sell cars in the US under its own brands, but it remains the Chinese automaker best positioned to build cars in the US. As it stands today, Geely will still need to convince the US government its software isn\u2019t Chinese at all \u2014 and was developed by some entity not controlled by a Chinese firm. At a Senate Commerce Committee hearing this week, Waymo officials were grilled<\/a> over the company\u2019s decision to use a decontented Zeekr RT <\/a>as its next robotaxi platform, with one Republican senator griping that the Alphabet-owned company\u2019s assurances that the vehicle met all relevant mandates \u201cridiculous.\u201d<\/p>\n

It would take roughly three years to add a new vehicle, from a different brand, to Volvo\u2019s South Carolina factory. Given the fast-moving nature of the current political situation, whether Geely will in fact have to prove its software complies with the Commerce rules during that entire period \u2014 for every model, for every model year \u2014 remains up to the changing imperatives and whims of the administration.<\/p>\n

Meanwhile, Geely\u2019s targets for localized production are hardly limited to the US. While its Volvo unit will have European assembly plants in three countries by the end of the year, Ford and Geely are reportedly in discussions about Geely potentially using excess Ford factory space<\/a> in Europe to produce vehicles for that market. And the leading autonomous vehicle company in the US, Waymo, is using a decontented Zeekr RT as its next-generation robotaxi.<\/p>\n

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