The Senate Commerce Committee recently advanced bipartisan legislation intended to block Chinese-linked automakers and vehicle technology from the U.S. market. The Motor Vehicle Modernization Act of 2026 aims to tighten restrictions on companies with significant Chinese ownership due to national security concerns, especially regarding connected cars potentially collecting sensitive data. However, the bill's ownership threshold of 15% has raised concerns about whether it might inadvertently affect established automakers with Chinese shareholders.

Senator Ted Cruz, a key figure in the committee, highlighted that the bill’s threshold could potentially include Mercedes-Benz, since its two largest individual shareholders are Chinese investors holding nearly 20% of company shares combined. These shareholders are the Chinese state-owned BAIC with a 9.98% stake and Li Shufu, founder of Geely, with 9.69%. Cruz emphasized that it would be unthinkable to ban Mercedes-Benz and indicated that the legislation would require revision before it becomes law.

Ohio Senator Bernie Moreno, who introduced the bill with Michigan Democrat Elissa Slotkin, acknowledged Mercedes-Benz’s significant U.S. presence, noting that the automaker employs over 10,000 people and operates assembly plants in Alabama and South Carolina. Moreno stated that Mercedes-Benz would have until 2030 to come into compliance with the ownership limits or could apply for a waiver. The legislation aims to preemptively secure U.S. industrial interests while addressing technological concerns linked to China’s influence.

During the committee's markup, Cruz accused General Motors of supporting the provision to sideline Mercedes-Benz and boost Cadillac's competitiveness in the market. While GM is the leading automaker in the U.S., neither GM nor Mercedes-Benz issued immediate comments on the bill. If passed, the law would enforce stricter oversight on Chinese investments within the industry, reflecting growing apprehension over data security and foreign influence in U.S. automotive technology.