A bipartisan group of U.S. senators has introduced legislation that would prohibit the sale of connected vehicles made by automakers with more than 20% Chinese ownership. The bill puts Mercedes-Benz at risk of being barred from the American market because the German carmaker has over 15% Chinese ownership, according to the text of the proposal.
Why the bill targets Chinese ownership
The bill is aimed at foreign-owned automakers that have significant Chinese investment. Lawmakers behind the measure argue that vehicles with internet connectivity could be used to collect sensitive data on U.S. drivers and transmit it to Beijing. The threshold of 20% Chinese ownership was chosen to capture companies where Chinese stakeholders hold substantial influence, the bill's sponsors said in a statement.
Connected vehicles—cars and trucks that can access the internet for navigation, entertainment, or remote diagnostics—are increasingly common. The legislation would apply to any new vehicle sold in the United States that has such capabilities. Automakers that exceed the ownership limit would be banned from selling those vehicles in the country.
Mercedes-Benz in the crosshairs
Mercedes-Benz, a unit of Germany's Mercedes-Benz Group, has a Chinese ownership stake of more than 15%. While that is below the 20% threshold, the company is still considered at risk under the bill. The legislation does not specify exactly how the risk is determined, but the presence of Chinese ownership above 15% appears to trigger scrutiny.
The company has not publicly commented on the bill. Mercedes-Benz sells a range of connected vehicles in the U.S., including its popular E-Class and S-Class sedans, as well as electric models like the EQS. A sales ban would hit the brand hard in one of its largest markets.
What the bill would do
If passed, the bill would give the U.S. Department of Commerce authority to enforce the ban. Automakers would have to certify that they do not exceed the Chinese ownership threshold. Those that fail to comply could face fines and be blocked from selling any connected vehicles in the United States.
The legislation is still in its early stages. It has been referred to the Senate Commerce Committee, where hearings are expected in the coming months. The bill's bipartisan backing—from both Republican and Democratic senators—gives it a better chance of advancing than many standalone measures.
Supporters say the bill is about national security, not trade. Critics, however, worry it could disrupt supply chains and raise prices for consumers. The auto industry has not yet taken a formal position.
What happens next
The Senate Commerce Committee will hold a markup session on the bill, likely in the next legislative session. If it clears committee, it will head to the full Senate for a vote. The House has not introduced a companion bill yet, but similar language could be attached to must-pass legislation later this year.
For Mercedes-Benz, the clock is ticking. The company has not said whether it would restructure its ownership to comply, or if it would challenge the bill in court. The answer may determine whether the three-pointed star stays on American roads.
