- Congress is exploring ways to prevent Chinese automakers from selling cars in the U.S.
- American companies are exploring deeper ties with them anyway.
- The way Chinese automakers operate is influencing how car companies from other countries think and work.
Chinese automakers may be banned from the United States, but they are still changing its cars from afar.
Several federal policies already lock most Chinese-built cars out of the American market. Congress is currently debating new ways to block them, including a proposal that could even ban German-owned Mercedes-Benz because of its ties with its Chinese ownership stake.
But the center of gravity of the global automotive industry has moved to China, and the country’s car companies are reshaping how automakers everywhere work.
That includes partnerships with an iconic American company and, increasingly, companies elsewhere shifting their designs and processes to learn from China-based automotive giants you may not know.
We’ll break it down.
How They Are Locked Out Today
- High tariffs and software regulations minimize Chinese cars on the U.S. market.
- Congress may further tighten the laws to try to keep them out.
Today, China builds, buys, and exports more cars than any other country on the planet.
Chinese automotive giant BYD is, by some measures, the fastest-growing automaker on the planet. Chinese automakers have shown a remarkable ability to move into a country’s market and, in short order, come to dominate sales.
That comes partly thanks to low prices created by inexpensive labor and government support for manufacturers. But increasingly, it also comes from attractive, high-tech electric vehicles (EVs) built to a high level of quality. BYD now routinely places cars in the finals of the World Car of the Year competition and won one category in 2025.
The past two presidential administrations have attempted to keep Chinese automakers out of the U.S. market through two methods: high tariffs and restrictions on software.
Most Chinese-built cars today are subject to a 125% tariff in the U.S., erasing any price advantage. National security rules also restrict the sale of cars with Chinese-derived software in the U.S. – a move initiated by the Biden administration and continued under current President Donald Trump.
Some Chinese-Built Cars Are Here, Anyway
- Those measures have blocked some Chinese-built cars from the U.S. But a few make it in through relationships with brands already here.
Despite the rules, you may unknowingly see Chinese-built cars around you on American roads every day.
Two iconic American companies import a few cars from China. Ford imports its Lincoln Nautilus SUV from Hangzhou. However, U.S. Sen. Bernie Moreno (R-OH) recently told Reuters the company will move production to the U.S. when the car is next redesigned.
GM imports the Buick Envision from Shanghai, though the company has committed to moving production stateside by 2028.
Chinese companies also own some automakers that build cars outside of China. China’s Geely Automotive owns several brands, including Volvo and Polestar. That has proven complicated in recent months, as the U.S. Department of Commerce blocked Polestar from selling cars in the U.S. after 2027, but allowed Volvo to continue.
Americans can also see some Chinese-built cars on U.S. roads with foreign license plates. They’re already common in Southern border states, as trade agreements allow Chinese cars registered in Mexico to cross into the U.S. for limited periods. A new agreement will see the same phenomenon on the Northern border, as Canada has agreed to accept some Chinese brands under a quota system.
A recent study found that 38% of Americans would consider a car from a Chinese brand if they had the option. That number will likely grow with exposure.
American Companies Are Partnering With Chinese Automakers Elsewhere
- Ford will share production facilities in Spain with Geely under a new agreement.
American automakers are also finding ways to work with their Chinese counterparts – just not in the U.S.
Ford and Geely on Thursday announced an agreement “to form a Europe focused joint venture at Ford’s Valencia, Spain, manufacturing hub.”
The pair say they will build vehicles together “for European markets.” The agreement does not include any plans to send vehicles to the U.S., though it promises “a new member of the Bronco family,” which suggests they may be open to doing so.
CNBC explains, “The companies said Ford will own 66% of the joint venture, while Geely will have a 34% stake.”
Ford is not alone. CNBC notes, “Chrysler parent Stellantis has been expanding its yearslong partnership with China’s Leapmotor into Europe, and Germany’s Volkswagen has said it is open to sharing under-utilized European factories with Chinese car brands as part of a push to cut costs.”
Other Automakers Are Learning from Chinese Companies
- Even those not currently partnering with Chinese competitors say they want to learn from them.
Others are not working with the Chinese but want to work like them.
Traditionally, automakers can take up to five years to develop a new car from scratch. Chinese automakers have much faster development cycles.
Nissan CEO Ivan Espinosa told Nikkei last month that his company will halve its vehicle development cycle, targeting 30 months as a new standard using methods “drawn explicitly from China.”
Ford has also bet some of its future on a planned a series of low-cost EVs built on what it calls the Universal Electric Vehicle Platform. That emerged from a “skunk works” project Ford created to speed development, partly based on Chinese practices.
