The Senate Commerce Committee moved forward with bipartisan legislation on Wednesday designed to strengthen existing restrictions on Chinese automakers operating in the United States. The Motor Vehicle Modernization Act of 2026 establishes a 15% ownership threshold for Chinese investors, above which automakers would be barred from the market on national security grounds.
Chairman Ted Cruz raised concerns during the committee’s consideration of the bill, noting that Mercedes-Benz would fall under the ownership restrictions due to Chinese stakes in the company. Two investors with Chinese connections—state-owned automaker BAIC and Geely founder Li Shufu—collectively hold approximately 20% of Mercedes-Benz shares, exceeding the bill’s 15% limit. Cruz indicated the provision would require modification before the legislation could advance further in the legislative process.
Senators Bernie Moreno and Elissa Slotkin, who introduced the bill, emphasized the importance of preventing Chinese-linked vehicle technology from operating within the country. Proponents argue the measure protects the domestic industrial base by addressing national security risks associated with connected vehicles that could potentially collect sensitive data. The legislation would codify existing federal restrictions on Chinese automakers.
Mercedes-Benz has significant U.S. operations, employing more than 10,000 workers and operating assembly facilities in Alabama and South Carolina. Under the bill’s provisions, the company would have a compliance period extending to 2030, with the possibility of obtaining a waiver. During the markup session, Cruz also suggested that General Motors supported the ownership threshold provision as a competitive advantage, though neither GM nor Mercedes-Benz immediately responded to requests for comment.
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