The hidden perils of plugging in
In the sun-drenched suburbs of Sydney and the graffiti-covered laneways of Melbourne, electric vehicles (EVs) are silently zipping around, charging up in garages, and bringing smiles to the faces of those who voted for Labor’s march toward net zero.
It is, without doubt, a feel-good story: cleaner air for the user, reduced emissions for the suburb, and tech-savvy signalling to everyone else on the road. But beneath the glossy ads and government incentives lies a darker undercurrent – one that cybersecurity experts, former military leaders, and national security advisors have recently shouted from the rooftops.
What if those cheap Chinese-made EVs, which are rapidly taking share on Australia’s urban roads, aren’t just cars? What if they’re potential Trojan horses, embedded with the power to spy, sabotage, or even explode at the command of a foreign adversary?
I am sure it sounds absurd to you too, but what do you really know about the technology? We tend to read articles that support our biases, and when most people say they’ve ‘researched’ something, they really mean they’ve read an article or two.
Recent warnings from high-profile figures, such as Alastair MacGibbon, the former advisor to Prime Minister Malcolm Turnbull and now chief strategy officer at CyberCX, suggest that we should be debating how many more of these cars we should permit for importation.
Speaking at the Financial Review Cyber Summit in Sydney, recently, MacGibbon was direct: millions of Chinese-manufactured connected devices – including EVs and home batteries – can be remotely disabled or rigged to overcharge and detonate, turning suburban driveways into scenes of chaos. Echoing these alarms, articles in The Australian Financial Review and The Australian in the last few weeks describe “grey zone” threats: subtle, insidious risks that erode sovereignty without firing a shot.
Again, you can brush the risk aside, call it nonsense, say it’s a beat-up, not care about national security because ‘we will never be in a war’, or even claim it’s racist, but have you really enough information about all the technology embedded in modern Chinese EVs to win a one-on-one debate with MacGibbon? If not, you may want to consider your next car purchase more thoughtfully.
As Australia hurtles toward installing a million home batteries – mostly made in China – by 2030 and integrating EVs into our national power grid, the stakes are serious. With over 265,000 Chinese-made EVs and hybrids registered since 2019, and Chinese brands like BYD, MG, Great Wall Motors, and Chery cracking Australia’s top 10 in terms of sales, we’re not just importing vehicles – the experts warn we are inviting a foreign power into the heart of our energy and transport systems.
Hunter S. Thompson famously said, “There’s no such thing as paranoia. Your worst fears can come true at any moment.” Mind you he also said “Paranoia is just another word for ignorance.” But this isn’t paranoia; it’s a genuine vulnerability born from unchecked globalisation.
China’s grip on Australia’s EV and battery market
To understand the scale of the threat, let’s start with some numbers. Chinese manufacturers command over 80 per cent of Australia’s new EV imports and more than 70 per cent of the home battery market.
According to the Centre for International Economics, on present trends, within a decade, 43 per cent of all cars imported to our shores will come from China. Since 2019, the Federal Chamber of Automotive Industries has reported 265,000 Chinese EVs and hybrids have been registered, with four Chinese brands now competing for supremacy in monthly sales tallies.
And it’s worth remembering, this isn’t an organic market evolution. It’s fueled by federal government policies like the $2.3 billion home batteries program and impending car efficiency standards, which have funnelled cheap, Chinese-sourced products into Australian homes and garages.
The Clean Energy Council estimates 185,000 home batteries are already installed nationwide, many of them Chinese-made and primed for integration with rooftop solar to stabilise the grid. EVs, too, are envisioned as rolling power banks – charging by day and feeding electricity back to homes at night. It’s an idyllic and symbiotic vision for sustainability, but it’s also a vision that must hand unprecedented leverage to Beijing.
Brian Craighead, founder of Australia’s lone home battery maker Energy Renaissance (now in administration for its civilian arm but thriving in military applications), calls it a “reckless decision”, adding, we’ve essentially, “handed over the keys to the castle.”
Meanwhile, the U.S. Department of Defence has already mandated that all new military batteries on bases source components exclusively from American or allied nations, stripping out those from China amid espionage fears.
Chinese technology also permeates wind turbines, solar inverters, and even port cranes – essentials that power our economy. As Richard McGregor, a China expert at the Lowy Institute, notes, the dilemma is existential: Do we pay a premium to onshore production and “rip out” existing Chinese gear at colossal cost, or bet against a Taiwan conflict where Beijing could retaliate by disabling our systems?
Inaction now risks catastrophe later.
Surveillance and sabotage
The core of experts’ concerns is the “smart” tech that makes EVs so appealing. EVs aren’t dumb hunks of metal; they’re rolling data centres with cameras, microphones, GPS, and constant back-to-base internet connectivity. Chinese law mandates that companies like BYD or CATL (the world’s largest battery maker) cooperate with Chinese intelligence agencies, turning consumer products into Chinese state assets.
Home Affairs Minister Tony Burke learned this the hard way last year when his department warned him to “take precautions” while driving his Chinese-made EV, lest it compromise national secrets through eavesdropping or data extraction.
EVs double as mobile mapping machines, collecting geolocation data, audio snippets, and visual feeds from dashcams and cabin sensors. MacGibbon likens them to “listening devices” and “surveillance devices,” capable of profiling drivers, neighbourhoods, and infrastructure in real-time. In a conflict scenario, this intel could map military movements or civilian vulnerabilities.
The threats escalate beyond spying.
Consider the “kill switches” uncovered by Reuters in May this year: hidden in Chinese-supplied solar inverters and batteries at U.S. solar farms (and replicated globally). These cellular radio-embedded systems allow remote shutdowns, freezing power grids and triggering blackouts. The report noted a “built-in way to physically destroy the grid.” Former director of the U.S. National Security Agency, Mike Rogers, confirmed China’s strategy: embedding disruption elements in core infrastructure for leverage. Last November, Reuters revealed Chinese operators remotely disabled U.S. inverters as a proof of concept for weaponising technology.
For Australian EV owners, there are genuine parallels. There’s software that governs everything from your battery’s charging cycles to its safety protocols. By overriding those, MacGibbon says China can strip away overcharge protections, which force the batteries to absorb more energy until they explode. Now consider a residential battery pack carries up to 50 times the punch of an e-bike cell – those which explode frequently burning down homes and risking lives. Consider that an EV’s battery is exponentially larger again.
The consequent fires would be bad enough, but explosions could level homes, ignite neighbourhoods, or cause gridlock on our roads as people try to flee urban centres. Retired Lieutenant General Peter Leahy, the former chief of the army, worries about the threats to our electricity and water infrastructure.
While it might be hypothetical today, “grey zone” warfare unfolds through economic and technological tendrils rather than tanks. The proliferating “smart technology” in phones, TVs, and now vehicles exposes Australia’s economy and daily lives to unprecedented risk. As Stephen Kuper, from Defence Connect, laments, we’re trading our prosperity for sovereignty. He says our addiction to cheap Chinese imports – from Kmart trinkets to EVs – may be “sowing the seeds of our own destruction”.
The U.S. draws a line
For many years I warned governments take a lazy approach to winning votes – just give voters access to cheaper stuff and they’ll be happy. Australia’s government is doing the same with cars. It’s a policy in stark contrast to that of the U.S.
In January this year, the Biden administration finalised a sweeping ban on Chinese and Russian technology in cars and trucks, citing fears of surveillance and “deliberate crashes.” Commerce Secretary Gina Raimondo put it bluntly: “We don’t want two million Chinese cars on the road and then realise we have a threat.” Over there, software bans kick in for 2027 models, and hardware by 2029.
Chinese batteries were also yanked (pun intended) from military bases over spying concerns, and the TikTok saga (another Chinese export) continues to put the perils of data-harvesting apps under the spotlight. Raimondo’s warnings about connected vehicles echo MacGibbon’s here in Australia. Yet, despite high-risk vendors being excised from 5G networks under Turnbull’s national security committee, Labor are inviting the same wolf through the EV door, just seven years later.
What’s needed to decouple on our terms rather than Beijing’s? We need to mirror certification mandates, impose supply chain audits, and introduce incentives such as tying insurance rebates to “cyber-secure” ratings. What’s being suggested is something like our Energy Star ratings, but for defence and security.
For Australia, is it too little, too late?
So far, the federal government’s response has been a typical and unsurprising mix of dithering and half-measures. While Department of Home Affairs head Hamish Hansford acknowledges overseas tech risks, experts such as James Turner of CISO Lens say’s the government response is insufficient. Last September, when the U.S. bans were introduced, Australia’s Home Affairs pledged to “monitor developments” and chat with Washington.
But why let authoritarian-headquartered firms dominate data-rich vehicles? Because they are cheaper and they keep voters happy. The short-sightedness and self-interest is spectacular. It would be hilarious, were it not so serious. And the dithering comes from the fact that ripping out Chinese tech would be Herculean and expensive.
The alternative, however, could be a hijacked grid, weaponised vehicles, and a nation hobbled during a geopolitical fight.
A path forward
While it would be easy to accuse the journalists who write these articles as biased against EVs or with an axe to grind against China, let’s not forget the articles are reporting on experts who work in security and defence. It’s their warnings that should be noted.
Sure, it’s not just EV’s that can be co-opted for spying. Many homes have enabled security cameras that send images and video back to a Chinese-domiciled cloud servers, Telstra modems and routers are made in China and there have previously been reports of smart TVs spying on their viewers. But the EV claims are about major infrastructure and mobile surveillance – something else entirely.
As a motoring journalist once admittedly prone to scoffing at conspiracy theorists, Stephen Corby of The Australian, now says, “Just because you’re paranoid, it doesn’t mean they’re not out to get you.”
Should Australia double down on cheap imports, and ignore the strings attached to them, or should we change gears, turn off the road we’re on, enforce rigorous cybersecurity certifications, and learn from our allies who’ve put a stop sign up. This is not about halting the EV revolution or net zero – although many argue we should do that too. This is about ensuring our ideologues don’t hand our future to a rival power with a very different set of attitudes to human rights and freedoms.
Cited are Sam Irvine, Paul Smith, and Greg Bearu’s insights from the Financial Review’s Cyber Summit and Stephen Corby’s analysis from The Australian.
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.
He is also author of best-selling investment guide-book for the stock market, Value.able – how to value the best stocks and buy them for less than they are worth.
Roger appears regularly on television and radio, and in the press, including ABC radio and TV, The Australian and Ausbiz. View upcoming media appearances.
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