The industry faces its first major deadline with model year 2027 vehicles, when covered connectivity and automated-driving software linked to China or Russia will be barred from new cars sold in the United States. Restrictions on vehicle connectivity hardware will take effect for model year 2030, or from January 1, 2029, for components not assigned a model year.
The rules cover systems that allow vehicles to communicate externally, including telematics control units, cellular modems, Bluetooth, Wi-Fi and satellite modules. Software that directly enables these functions is also covered, alongside code used in highly automated driving systems.
Federal authorities argue that connected cars collect extensive data about drivers, passengers, travel patterns and surrounding infrastructure. Vehicles can transmit locations, voice commands, camera images and diagnostic information. Officials have warned that foreign-controlled technology could expose that data or provide a route for remote disruption.
Automakers must now identify not only where components are manufactured, but also who designed their software, controls their intellectual property and supplies embedded code. That process can extend through several layers of contractors, chipmakers, module assemblers and software developers.
Chinese suppliers became deeply embedded in the global automotive electronics market by offering competitively priced telecommunications modules, reliable production capacity and rapid product development. Replacing them requires fresh validation, cybersecurity testing and integration work that can take years for a single vehicle programme.
Demand is consequently rising for communications equipment made by US and allied-country suppliers. Eagle Wireless, an Ohio-based company established in late 2025, is expanding production of automotive connectivity modules as manufacturers search for alternatives. The company aims to build annual revenue of $100 million and employ about 1,000 people within three years.
The shift creates an opening for domestic technology businesses, but building a secure automotive supply base will require more than assembling imported parts in the United States. Carmakers are seeking clarity about the origin of chip designs, firmware, engineering services and ownership structures throughout the production chain.
Quectel Wireless Solutions, one of the world’s largest suppliers of internet-of-things modules, has become a prominent focus of the transition. Its products have been widely used across automotive, industrial and consumer applications. Manufacturers replacing such equipment must redesign circuit boards, antennas and vehicle software while ensuring that performance remains stable across different mobile networks.
Established carmakers face a heavier burden than younger electric-vehicle companies because they operate large model ranges and long product cycles. A single component may be shared across vehicles assembled in several countries, making substitution difficult without disrupting manufacturing schedules or increasing costs.
Rivian and other newer manufacturers can modify technology architectures more quickly because their vehicle platforms and software systems were designed around centralised computing. Legacy groups often depend on numerous electronic control units and suppliers contracted years before a vehicle reaches showrooms.
The regulation also affects vehicles assembled outside China when covered software is installed there or when manufacturers are controlled by Chinese or Russian entities. Companies that believe their products present limited security risks can seek specific federal authorisation, but approvals may require detailed disclosures about governance, data handling and technical safeguards.
Ford has sought permission to continue importing the Lincoln Nautilus, which is built in China using software developed in the United States. The company requires clearance because the software is installed during production in China.
Volvo Cars has secured authorisation to continue importing qualifying connected vehicles after providing information on its corporate governance, technology and data-security arrangements. The Sweden-headquartered manufacturer is majority-owned by Zhejiang Geely Holding Group.
Polestar faces a more difficult position. The electric-car company, also controlled by Geely, has been denied authorisation to sell new connected vehicles under the restrictions from model year 2027. Existing inventory can still be sold and owners can continue receiving service, but the decision has placed its US dealership network under pressure.
China has rejected the security justification for the measures and described them as discriminatory and protectionist. Beijing maintains that its technology companies compete globally because of product quality and cost advantages, and has warned that restrictions could damage international supply chains.
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