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Economy

House bill targeting Chinese auto ownership may inadvertently ban Mercedes-Benz

30 May 2026 · Source balance: Centre

Congress is weighing legislation called the Motor Vehicle Modernization Act of 2026 that would prohibit automakers with Chinese government ownership stakes from selling or manufacturing vehicles in the U.S. Mercedes-Benz may be caught by the bill because China's state-owned automaker BAIC owns 9.98 percent of the company, while Chinese billionaire Li Shufu holds another 9.69 percent through an investment firm, together totaling nearly 20 percent. The bill's 15 percent ownership threshold means Mercedes could be banned from operating in America despite having two major assembly plants in Alabama and South Carolina that employ over 10,000 workers and have produced millions of vehicles since the 1990s. Lawmakers in both parties support the legislation to prevent Chinese automakers from gaining market share, citing national security concerns. However, experts and industry groups warn the bill may unintentionally harm an established German luxury brand with deep U.S. manufacturing roots rather than its intended target of Chinese-controlled companies.

Key facts

  • BAIC owns 9.98 percent of Mercedes-Benz; Li Shufu owns 9.69 percent; combined stake is 19.67 percent
  • Mercedes-Benz Tuscaloosa plant has produced over 5 million vehicles since 1997
  • Mercedes-Benz employs more than 10,000 people across U.S. plants in Alabama and South Carolina
  • Bill sponsored by Republican Rep. Brett Guthrie; currently House-only with no Senate companion
  • Mercedes-Benz sold 303,200 passenger cars and 12,400 vans in U.S. in 2025
  • The Motor Vehicle Modernization Act would ban sales and manufacturing for five years
  • Bipartisan Senate bill introduced by Democrat Elissa Slotkin and Republican Bernie Moreno also targets Chinese-linked vehicles

How different outlets framed it

Right-leaning coverage: Right-leaning focus centers on China's strategic threat to American automotive dominance and the need for strong security measures. Supporters emphasize China's aggressive subsidies, rapid global expansion, and the risks posed by connected vehicles that could serve as surveillance tools, arguing tough restrictions are necessary regardless of collateral impact on companies with partial Chinese ownership.

Limits of this briefing

Left-leaning labor and progressive perspectives on the bill's impact on workers and unions were not substantively represented in available sources. Right-leaning national security arguments are present but limited to specific quotes; broader conservative media coverage was not located.

Sources

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