There has been growing concern in the United States over data security risks associated with vehicles linked to Chinese automakers or investors. Now, Mercedes-Benz could face challenges by 2030 if a proposed bill becomes law.
As connected vehicle technology becomes standard across the industry, U.S. lawmakers are tightening regulations involving Chinese ownership and technology in the automotive sector.
Existing U.S. rules already restrict the sale of certain connected vehicles with Chinese software, while steep tariffs have made it largely impractical for Chinese automakers to sell vehicles in the country.
Polestar has already been forced to end U.S. sales beginning with the 2027 model year under the new connected vehicle rules. If the proposed legislation is enacted, other automakers with significant Chinese ownership, including Mercedes-Benz, could also face restrictions unless they comply with the new requirements.
Around 20% of Mercedes-Benz Is Owned by Chinese Entities
According to a report by Reuters, the U.S. Senate Commerce Committee approved legislation that would prohibit automakers with 15% or more Chinese ownership from selling vehicles in the country.
Nearly 20% of the stake in Mercedes-Benz is owned by Chinese investors. Eric Li Shufu, the founder and chairman of Geely, holds a 9.69% stake through an investment firm, while the BAIC Group (Beijing Automotive Group) owns 9.98%.
Thus, Mercedes-Benz could be affected if the legislation passes, since its Chinese ownership exceeds the 15% threshold specified in the bill, unless the minimum requirement is changed. Senator Ted Cruz, the committee chair, said that the bill requires changes.
Cruz alleged that General Motors was pushing to remove Mercedes-Benz from the market so its own brand Cadillac can benefit from it. However, he mentioned that “we would never consider” banning Mercedes-Benz sales in the United States.
GM responded that the legislation does not target one automaker but “supports policies that protect and strengthen American manufacturing and the global competitiveness of U.S. automakers.”
Mercedes Has Less Than Four Years to Ensure Compliance
Senator Bernie Moreno, meanwhile, confirmed that Mercedes-Benz has time until 2030 to comply if the bill becomes law. However, it is unclear how the German automaker would ensure compliance.
Moreno, however, said Mercedes-Benz could receive waivers, allowing it to continue operating in the U.S. However, the conditions for receiving those waivers were not disclosed.
Speaking of compliance, Polestar, the Swedish brand that will stop selling its cars from 2027, did not appeal the Department of Commerce’s ruling.
Guessing Headlights recently reported how Polestar, which is owned by China’s Zhejiang Geely Holding Group, has apparently given up on its American dream and will focus on other “profitable” markets.
The rule, which was announced in 2025 and applies to 2027 models, restricts the import and sale of cars featuring connected technology that is related to China or Russia.
U.S. officials claimed that connected technologies, including cameras and GPS systems, pose a national security risk when owned by Chinese brands.
It appears that Polestar tried to have the ban lifted after company spokesman Michael Ofiara said the company had engaged in “significant dialogue” with officials. However, their response led Polestar to conclude that an appeal would not succeed.
Volvo, however, received different treatment. The Swedish automaker also has Chinese links, as Geely owns a majority stake in the company. But the brand received approval to continue its operations in the U.S. after demonstrating how it manages vehicle data and cybersecurity.