Washington, United States – The U.S. Senate Commerce Committee on Wednesday advanced the bipartisan Motor Vehicle Modernization Act of 2026, a measure intended to tighten restrictions on Chinese automakers entering or operating in the U.S. market. The legislation sets a 15% Chinese ownership threshold for automakers, seeking to limit vehicles produced by companies with significant Chinese investment and to curb the influence of Chinese state-backed capital in the American auto sector. Lawmakers framed the bill as part of a broader effort to address economic and national security concerns linked to China’s growing role in the global automotive industry. During the committee’s markup, Chairman Ted Cruz, a Republican from Texas, supported the broader goal of restricting Chinese automakers but warned colleagues that the ownership threshold could have unintended consequences. He noted that the provision, as drafted, would likely apply to Mercedes-Benz because two Chinese investors together hold nearly 20% of the German carmaker’s shares, exceeding the bill’s 15% benchmark. Cruz said this could effectively bar Mercedes-Benz vehicles from the U.S. market, and he highlighted the example to underscore the potential impact of the bill on non-Chinese manufacturers with substantial Chinese minority shareholders.

Prepared by Lauren Mitchell and reviewed by editorial team.