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Can an EV spy on you? Don’t worry. Australia isn’t 

Can an EV spy on you? Don’t worry. Australia isn’t 

While all fingers are pointing to an Australian politician being guilty of spying against Australia and allegedly for the Chinese, should we also be pointing the finger at Chinese-made electric vehicles (EVs)? 

On February 29, U.S. President Biden released a statement entitled, addressing national security risks to the U.S. auto industry. Biden stated;  

“Most cars these days are “connected” – they are like smartphones on wheels. These cars are connected to our phones, to navigation systems, to critical infrastructure, and to the companies that made them. Connected vehicles from China could collect sensitive data about our citizens and our infrastructure and send this data back to the People’s Republic of China. These vehicles could be remotely accessed or disabled.” 

There’s some merit in his concerns; modern vehicles are effectively connected computers on wheels, collecting a vast array of information using sensors, apps and cameras and sending much of it back to its manufacturer.  

The increased connectivity of cars will pose a quandary for regulators around the world. 

In the statement, Biden announced “unprecedented actions to ensure that cars on U.S. roads from countries of concern like China do not undermine our national security. I have directed my Secretary of Commerce to conduct an investigation into connected vehicles with technology from countries of concern and to take action to respond to the risks.” 

There has been a surge of warnings from top U.S. officials, including Federal Bureau of Investigation Director Christopher Wray, regarding the potential threat to American lives posed by the infiltration of the nation’s critical infrastructure by Chinese hackers. 

The White House recently revealed plans to invest more than $20 billion in maritime security, raising concerns that China-built cranes with advanced software at many of that nation’s ports posed a potential national security risk. 

Regulators in Europe have also opened investigations into how the auto industry uses personal information from cars, such as location data. In some cases, those regulators have forced manufacturers to update software to limit data collection. 

Still, most vehicles sold in the U.S. use software and operating systems made by tech firms based in the U.S. or Europe—not China. While China does make some cameras, microcontrollers and sensors for vehicles sold in the United States, those parts are integrated into systems that are largely made by non-Chinese parts suppliers, such as Bosch and Harman, so you would think it would be difficult to collect the data. 

That makes the threat of this kind of software currently quite low.  

However, when Chinese companies partner with or buy these non-Chinese suppliers, the threat increases. The incentives are also greater for Chinese-sponsored hackers when some of the Chinese brands that have investments from China’s government start to move serious volumes of cars into the U.S. and other markets. 

Americans, therefore, don’t currently have much to fear about Chinese-manufactured EVs. So, one wonders whether Biden is simply protecting U.S. car manufacturers from competition in order to win votes in the next election.  

That’s an ongoing debate, but it’s one that should take place independent of a proper risk assessment. 

Here in Australia, we bought 1.217 million new vehicles in 2023. More than one million were conventional petrol and diesel-powered new vehicles. We also purchased a record 87,217 EVs, up 161 per cent in 2022 and representing 7.2 per cent of total industry sales. Meanwhile, new plug-in hybrid electric vehicle (PHEV) sales totalled 11,212 (+88.8 per cent in 2022), and series/parallel hybrid car sales were 98,439 units (+20.3 per cent). In total, the number of electrified vehicles sold to Australian homes and businesses reached 196,874 units in 2023. 

Knowing these numbers, you can safely say that down here in Australia, on our vacant block at the end of the globe’s cul-de-sac, our regulators and politicians are happily asleep at the wheel.  


Roger Montgomery is the Founder and Chairman of Montgomery Investment Management. Roger has over three decades of experience in funds management and related activities, including equities analysis, equity and derivatives strategy, trading and stockbroking. Prior to establishing Montgomery, Roger held positions at Ord Minnett Jardine Fleming, BT (Australia) Limited and Merrill Lynch.

This post was contributed by a representative of Montgomery Investment Management Pty Limited (AFSL No. 354564). The principal purpose of this post is to provide factual information and not provide financial product advice. Additionally, the information provided is not intended to provide any recommendation or opinion about any financial product. Any commentary and statements of opinion however may contain general advice only that is prepared without taking into account your personal objectives, financial circumstances or needs. Because of this, before acting on any of the information provided, you should always consider its appropriateness in light of your personal objectives, financial circumstances and needs and should consider seeking independent advice from a financial advisor if necessary before making any decisions. This post specifically excludes personal advice.

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