US Lawmakers Negotiate Chinese Auto Bill to Avoid Unintended Ban on Mercedes-Benz

A key Republican sponsor of a bill aimed at restricting Chinese vehicle sales in the U.S. confirmed that negotiations are in progress to prevent an unintentional ban on automakers like Mercedes-Benz. The legislation, as currently written, could impact several established brands with significant minority ownership by Chinese entities.

The Bill's Scope and Market Impact

The bill, which was approved by the Senate Commerce Committee in July, would prohibit companies with more than 15% ownership by Chinese entities from selling vehicles in the United States. This provision has raised concerns for several major automakers, according to Republican Senator Bernie Moreno, a sponsor of the bill.

Automakers potentially affected by the current draft include:

• Mercedes-Benz: Has nearly 20% passive ownership from Chinese entities.
• Volvo Cars: Majority-owned by China’s Geely Holding.
• Aston Martin: Geely holds a 17% stake.
• Lotus: Also majority-owned by Geely.

"What we’re not going to do, obviously, is ban Mercedes-Benz vehicles in America," Senator Moreno stated, acknowledging discussions are focused on how these companies could comply without being debilitated.

Legislative Negotiations

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The bill's advancement is currently being held up by Senator Rand Paul, who told Reuters he views the legislation as an "unfair attack on Mercedes-Benz." He indicated he would allow the bill to proceed if the company were exempted.

Despite this, the bill has broad bipartisan support. Its chief Democratic sponsor, Senator Elissa Slotkin, said last week that support is effectively "99 to 1." Senator Moreno is reportedly seeking a fast-track approval for the bill this week, with a parallel version in the House of Representatives now having more than 100 co-sponsors.

Broader US-China Auto Tensions

This legislative effort adds to a series of U.S. government actions designed to counter China's influence in the automotive sector. Washington already maintains tariffs of over 100% on Chinese electric vehicles.

Furthermore, a regulation from the previous administration, enacted in early 2025, effectively barred Chinese automakers from the U.S. market by citing risks that sensitive driver data could be sent to China. The Chinese foreign ministry has previously criticized such measures as an "unreasonable suppression" that violates principles of fair competition.