Efforts to ensure Mercedes-Benz can keep selling cars in the U.S. amid proposed legislation to ban Chinese-made vehicles and auto-related companies tied to China are intensifying.
The details: Sen. Bernie Moreno (R-OH), one of the bill’s sponsors, said the goal is not to ban the German automaker, but to address concerns about its Chinese ownership, according to Reuters.
The bipartisan bill would bar companies with more than 15% ownership by Chinese entities from selling vehicles in the U.S., potentially putting Mercedes in its crosshairs with nearly 20% ownership by Chinese entities.
The German automaker contends that the Chinese ownership is passive, with limited influence over how the company operates.
Moreno said there are also discussions about how Volvo could continue selling vehicles in the U.S. under the proposed legislation, with the Swedish automaker majority-owned by China’s Geely Holding.
"We're looking at a variety of different things," Moreno said, while also noting that Aston Martin, which is 17% owned by Geely, and Britain’s Lotus could be banned from selling vehicles in the U.S., per Reuters.
Why it matters: Any changes that allow Mercedes and other established brands with Chinese ownership ties to continue operating in the U.S. could protect existing dealer networks from major disruptions while providing greater clarity around which automakers would ultimately be affected by the proposed restrictions.
Between the lines: Moreno’s position on the proposed legislation, co-authored by Sen. Elissa Slotkin (D-MI), could help address concerns raised by Sen. Rand Paul (R-KY), the last remaining holdout.
Paul has said he thinks the bill unfairly targets Mercedes and that he would be open to supporting the legislation if it is modified so the German automaker can continue selling vehicles in the U.S.
A House bill similar to the proposed Senate legislation now has 100 co-sponsors and is expected to receive a vote by the end of the year.
Bottom line: Efforts to carve out a path for Mercedes and potentially other established automakers with Chinese ownership ties underscore the complexities of restricting China’s influence in the U.S. auto market while determining whether existing franchises could face disruption.
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