U.S. Crackdown on Chinese Car Tech Forces Ford and Others to Seek Emergency Permits

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Ford Needs a License to Keep Selling Its Own SUV

Ford's Lincoln Nautilus is built in China. That alone has become a legal problem.

The automaker has formally asked the U.S. Commerce Department for permission to keep importing the SUV into the United States. The reason: although the vehicle's software was developed in the U.S., it gets installed into the car on Chinese soil — and that is now enough to trigger federal review.

Ford confirmed the application to Reuters, making the Nautilus one of the clearest examples of how a sweeping new regulatory framework is catching even long-established models in its net.

Where the Rules Come From

The regulations were put in place in January 2025 under President Joe Biden, following national security concerns about the ability of modern connected vehicles to collect sensitive data on American drivers and infrastructure.

Connected vehicles (cars with internet access, GPS, cameras and sensors that communicate with external systems) are increasingly seen as potential surveillance tools if their software or hardware components are controlled by adversarial foreign governments.

The Biden administration acted. And notably, the Trump administration has kept the rules intact.

Two Deadlines, Two Waves of Disruption

The ban rolls out in two stages:

Software restrictions take effect for model year 2027. These cover most software developed or maintained by Chinese companies, as well as vehicles with significant Chinese ownership in their corporate structure.

Hardware restrictions follow for model year 2030. Industry analysts expect this second wave to cause far greater disruption. Researchers at the Rhodium Group, an independent policy research firm, concluded that hardware rules will be "more cumbersome and require more time for automakers to adapt."

Ford said it expects to begin importing 2027 model year Nautilus vehicles in January, giving it only months to secure authorization before the software rules kick in.

Who Else Is Affected?

Ford is not alone. Several other major automakers are caught in similar legal grey zones:

Volvo Cars, majority-owned by China's Geely automotive group, confirmed it received an authorization — but said it still needs to ensure compliance across its entire U.S. lineup.

Polestar, also majority-owned by Geely, declined to confirm whether it had submitted an application. The company said it is working with the U.S. government to meet the new requirements.

General Motors builds its Buick Envision in China. GM has announced it will move production of that model to a plant in Kansas by 2028 — a direct response to the regulatory pressure. It also declined to say whether it had applied for an authorization.

The Commerce Department does not publicly disclose which companies have applied or what decisions have been made, leaving the full scope of the licensing process opaque.

Supply Chain Problems Run Deep

The ripple effects extend beyond car manufacturers to parts suppliers.

MEMA, a major U.S. supplier association, raised the alarm before the rules were finalized, questioning how far the restrictions would reach. In comments submitted to the Commerce Department's Bureau of Industry and Security in late 2024, MEMA pointed out that software is routinely developed by global engineering teams — and asked whether even a single line of code written in China could trigger the ban.

The Italian tire manufacturer Pirelli found itself in an unexpected bind: one of its products risked being banned because of a large Chinese shareholder. The Italian government responded by limiting how many board seats that shareholder could appoint. Pirelli subsequently announced it would manufacture the affected product at a U.S. facility.

What Comes Next

The licensing process is described as complex and lacking in transparency. Automakers are navigating it with little public guidance and no clear timeline for decisions.

General Motors has already signaled the direction the industry is heading — moving production out of China and back to American plants. Others may be forced to follow, especially as the 2030 hardware deadline approaches.

The broader message from Washington is clear: vehicles connected to the internet are no longer just consumer products. They are, increasingly, a matter of national security.

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Sources:

1. https://www.reuters.com/business/autos-transportation/us-connected-car-rule-prompts-ford-other-automakers-seek-licenses-china-built-2026-06-15/
2. https://www.federalregister.gov/documents/2025/01/14/2025-00636/securing-the-information-and-communications-technology-and-services-supply-chain-connected-vehicles
3. https://rhg.com/research/the-road-ahead-connected-vehicle-rules/
4. https://www.reuters.com/business/autos-transportation/gm-tells-suppliers-rid-parts-made-china-2027-sources-say-2024-05-29/

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