January 2025, so a future administration can’t undo it with the stroke of a pen. Senator Moreno and Congresswoman Dingell both spoke at the NADA Washington Conference. Moreno spent his career as a dealer before he ran for office, and it shows when he talks about this issue. He told CBT News in July that letting these vehicles in would be “committing industrial suicide, and that’s exactly what this bill is preventing.” Congresswoman Dingell has been in the auto industry’s corner as long as anybody in Congress. She and Chairman Moolenaar have been blunt: Chinese automakers win on forced labor, government subsidies and unfair trade, and their vehicles send data back to China. As she said, “I will never give up our leadership to China or any other country in the world.” Where It Stands The Senate bill, S. 4429, cleared the Senate Commerce Committee unanimously on July 22. The sponsors tried to pass it by unanimous consent in late September, and Senator Rand Paul (R-Kentucky) objected. Under Senate rules, one objection is enough to block it. The sponsors are negotiating with him, and the next chance comes when the Senate returns after the election. The House companion, H.R. 8730, was filed May 11 and still has to clear three House committees. Senator Moreno has said that the job now is to get the House and Senate on the same page. If it doesn’t pass by the end of the year, it starts over. Why It Matters to Your Store Look at what’s happened in Europe, Mexico, Australia and South America, and what is happening in Canada: Chinese brands backed by government money have grabbed market share quickly, and companies without that kind of backing can’t compete on price. Every one of you has millions tied up in facilities, inventory and people. That investment depends on a fair fight. NADA President and CEO Mike Stanton has driven these vehicles and doesn’t knock their quality or their price; his concern, and mine, is that they aren’t competing on a level playing field. There’s also a national security problem. Today’s vehicles carry cameras, microphones, GPS and sensors, and they communicate with external networks and receive software updates over the air. Chairman Moolenaar calls them “rolling data collection devices.” Chinese law requires that country’s automakers to cooperate with its state security and intelligence services when asked. That would give a foreign adversary a window into where Americans drive and what our roads, ports and bases look like, plus a way to push code to vehicles on our highways. The information on the folks who buy from you has no business ending up in Beijing. There’s still work to do on the language. In committee, Commerce Chairman Ted Cruz warned that the bill’s 15% Chinese ownership test could sweep in Mercedes-Benz, and that the bill won’t get through the full Senate with that test in it. Two Chinese investors, state-owned BAIC and Geely founder Li Shufu, together own just under 20% of Mercedes. Senator Moreno, who owned a Mercedes-Benz dealership outside Cleveland and whose son is still a Mercedes dealer, said that isn’t the intent and that Mercedes would have until 2030 to make changes or seek a waiver. Volvo is a bigger problem on paper. China’s Geely owns nearly 80% of it. Commerce let Volvo keep selling under the current rule after talks over how it handles data, but it wouldn’t authorize Volvo’s sister brand, Polestar, which is also Geely-owned, so Polestar will stop selling new cars in the U.S. starting with the 2027 model year. Moreno told dealers worried about their franchises, “Your franchise is not going to go away. Volvo will figure it out. Mercedes will figure it out.” Several brands our members sell have Chinese investors or build some models in China, so we’ll be watching the final language closely. LADA supports this bill the same way NADA does: We back its goals, but the ownership issues for Mercedes-Benz and Volvo have to be worked out in the final bill, because we have Louisiana dealers selling those brands. NADA is working with lawmakers and automakers on the final language so dealers don’t get caught in the crossfire. And if a Chinese brand ever comes here on fair terms through the franchise system, NADA has said it would stand behind the dealers who sell it, just like any other brand. What we won’t accept is anybody going around the franchise system. 6
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