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Chinese EVs pose a threat to US national security, Biden warns

Joe Biden
The President accused China on Thursday of using unfair trade tactics - Evan Vucci/AP

Joe Biden has warned Chinese electric cars are a threat to US national security, as he ordered a sweeping investigation into whether the vehicles can be exploited for spying.

The President accused China on Thursday of using unfair trade tactics to flood the US market with technology-packed vehicles that can hoover up sensitive data about people and infrastructure.

He said the US Department of Commerce would investigate vehicles that used technology from “countries of concern” and prepare to hit them with new restrictions.

Officials said it was too early to say what those could be, and there was no decision on a potential ban of Chinese cars, but that the government had wide-ranging powers, according to Reuters.

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The move comes as governments are bracing for a wave of cheap Chinese cars to hit western markets, amid warnings that traditional US and European manufacturers could be wiped out.

Mr Biden’s decision will be seen as a major escalation and piles pressure on the UK and Europe to take tougher action. It is also likely to trigger a backlash from Beijing.

Chinese electric cars already face substantial import tariffs in the US, with relatively few sold there currently, and they do not qualify for generous consumer subsidies.

Still, some have floated plans to build factories in neighbouring Mexico and analysts say they have scope to drop prices far lower than their US and European rivals. BYD’s Dolphin Mini is set to sell in Mexico for just $21,000 (£16,637) – less than half the price of Tesla’s cheapest model.

In the statement released by the White House, Mr Biden said: “A dynamic auto industry is vital to the US economy.

“China is determined to dominate the future of the auto market, including by using unfair practices.

“China’s policies could flood our market with its vehicles, posing risks to our national security. I’m not going to let that happen on my watch.”

The President claimed that electric cars, which are packed with sensors, cameras and other advanced technology, could be used by China to collect sensitive data about American citizens and infrastructure. They could even be “remotely accessed or disabled”, he claimed.

“China imposes restrictions on American autos and other foreign autos operating in China. Why should connected vehicles from China be allowed to operate in our country without safeguards?”, he added.

It comes after the EU launched an investigation into alleged unfair state subsidies provided to Chinese electric car makers last year.

The UK is yet to launch any investigation of its own but on Tuesday it emerged that the Department for Business and Trade has discussed an intervention amid fears that Chinese has given its car makers an unfair advantage through vast subsidies.

On Thursday night, a spokesman for the Government insisted that no formal request for an investigation – which must come from a car company – had been made, while a source close to Kemi Badenoch, the Business and Trade Secretary, would not comment.

However, Conservative MPs urged the Government to follow the White House.

Bob Seely, a Tory backbencher and a member of the foreign affairs committee, said: “We are being extremely naive in our relationship with China.

“China does not seek to live in harmony with the west but to dominate it.

“Of course we should be doing the same, and we need to think far more carefully about our economic relationship.”

Felipe Munoz, a global analyst at JATO Dynamics, said the US investigation would pile pressure for Britain and Europe to follow suit with their own tougher measures, potentially making a global slowdown in EV sales growth worse.

He added: “EVs are increasingly becoming a political issue now. It is no longer just about trade or economics.

“The UK will likely follow suit now because these Chinese brands are gaining traction very quickly.

“All these things create more uncertainty for consumers, that’s for sure. I am not expecting big growth numbers for EVs this year.”

Half of drivers say they will hold off from buying an electric car until the next decade following Rishi Sunak’s decision to delay the petrol car sales ban, new figures show.

A survey for the Society of Motor Manufacturers and Traders (SMMT) found that 46pc of respondents now plan to wait until after 2030 to make the switch.

That is up from just 11pc in early September, just before the Prime Minister announced that the ban on new petrol car sales would be pushed back by five years to 2035.

The SMMT blamed Mr Sunak’s decision for the shift in attitudes towards electric vehicles (EVs), along with continued high prices and a lack of public charge points.

It is calling on Jeremy Hunt, the Chancellor, to introduce urgent measures to revitalise flagging EV sales in the UK, pointing to a current lack of incentives for households.

Mike Hawes, the SMMT’s chief executive, said Mr Hunt should slash VAT on purchases of EVs by half, a move that would save the average consumer £4,000.