Mercedes-Benz may be shut out of U.S. market under congressional bill

Mercedes-Benz It could find itself locked out of the U.S. auto market (barred from producing or selling new vehicles in the country) under legislation passed by Congress.

The new bipartisan law aimed at limiting China’s participation in the US auto market could also affect Mercedes-Benz unless the bill is amended or the German automaker’s decision is changed. largest shareholder He sells his shares.

Design, Motor Vehicle Modernization Act of 2026It would ban automakers with “a direct or indirect equity interest in a hostile foreign government,” such as China, from importing, selling or manufacturing vehicles for sale in the United States.

of Mercedes-Benz largest individual shareholder State-owned Chinese automaker BAIC, formerly Beijing Automotive Industrial Corp., with a 9.98% stake. The potential impacts of the legislation on the automaker have not been previously reported.

Gray areas in the bill, depending on how it’s interpreted, could ban Mercedes-Benz from operating in the United States, several people familiar with the law told CNBC.

Two sources, who agreed to speak on condition of anonymity for fear of repercussions or because they were not authorized to speak publicly, said they believe the bill as currently written would ban the company.

“The language is clear and unambiguous,” said a former auto policy consultant and lobbyist who was consulted about the bill.

Energy and Commerce Committee press secretary Daniel Kelly confirmed the details of the legislation. He declined to comment directly on potential impacts on individual companies, including Mercedes-Benz.

A spokesperson for Mercedes-Benz declined to comment on the legislation but told CNBC on Friday that the automaker has two large assembly plants and employs more than 10,000 people in the United States.

The bill comes as lawmakers in both parties are trying to block it. Chinese automakers are prevented from gaining a foothold in the US market; whereas Chinese ownership already exists in some parts of the global auto industry.

House Energy and Commerce Committee Chairman Brett Guthrie, R-Ky. The bill sponsored by is currently solely an initiative of the House of Representatives. No Senate friends. This includes exemptions for Chinese-backed companies, but does not apply if they are directly or indirectly owned by the Chinese government.

Automakers that have produced passenger vehicles in the United States for at least five years before January 1, 2026 will be eligible for the exemption. However, the bill states that the exemption does not apply to companies with “a direct or indirect equity interest in a hostile foreign government.”

China is listed as a foreign enemy along with Russia and North Korea.

The bill aims to ban companies with such ownership from manufacturing, selling or importing vehicles in the United States for five years after the law goes into effect.

It’s unclear where the ownership language originated or whether Mercedes-Benz was mistakenly targeted, but Chinese ownership was a major concern for US politicians. Last year, the Trump administration signed a deal for social media platform TikTok to continue operating in the United States by creating a new entity in which China’s ByteDance maintains just under 20% ownership.

Again BAIC Despite being a Chinese government-owned company, the bill also includes restrictions on companies “controlled” by a foreign adversary; this is defined as a 15% stake held by “a person or a combination of foreign persons.”

Chinese billionaire is the second largest individual shareholder of Mercedes-Benz Li ShufuFounder and chairman of China-based Geely. Tenacou3 Potential Investment firm. This share corresponds to 9.69% of Mercedes-Benz shares.

Combined, owns Shufu and BAIC 19.67% Mercedes-Benz Group AG, the automaker’s parent company, as well as its brands and financial services.

Mercedes-Benz presents a smaller national security risk than Chinese-controlled automakers, said Stephen Ezell, vice president for global innovation policy at the Information Technology and Innovation Foundation in Washington, D.C., a think tank focused on industrial competitiveness that studies Chinese automakers.

“If Mercedes were included in the bill, I think it would be an unintended consequence that could lead to loss of jobs and profits,” Ezell said. he said.

Another recently implemented legislation includes a similar 15% ownership requirement. That bill, Connected Vehicle Security Act of 2026In the Senate, Sens. Bernie Moreno, R-Ohio, and Elissa Slotkin, D-Mich. by and in the House of Representatives Rep. John Moolenaar, R-Mich. and introduced by Debbie Dingell, D-Mich. However, exemptions under this legislation have not yet been determined.

Depending on exemptions, the 15% ownership requirement could also affect other automakers with Chinese ownership, such as Volvo, and smaller manufacturers such as Faraday Future, Lotus and Karma Automotive.

John BozzellaCEO Automotive Innovation AllianceIn a letter last week to Guthrie and Energy and Commerce ranking member Rep. Frank Pallone, D.N.J., described the bill as making “significant progress on several policy priorities that America’s auto industry has shared with committee members.”

Bozzella wrote that China’s strategy to “dominate global automotive manufacturing” poses a “clear and present danger to American economic and national security.”

The organization, which represents nearly every major automaker in the U.S., will continue to work with lawmakers to properly implement the policy, he said, adding that “the details matter.”

The lobby group declined to comment on the bill’s potential impact on specific automakers.

The Automobile Drives AmericaAnother lobbying group for foreign automakers, including Mercedes-Benz, declined to comment on the potential impact, citing an earlier statement regarding the Connected Vehicle Security Act that supports “the overall intent of this legislation” while ensuring it “does not result in unintended consequences that could create difficulties for U.S. manufacturing.”

New bills come in addition to previous ones restrictions in force The import and sale of connected vehicles with software from countries such as China has started. 2027 model year and equipment from these countries, as well as 2030 model year.

Connected vehicles have internet access and wireless connectivity with other cars or trucks; Supporters say the technology could improve road safety.

Volvo, majority-owned by Shufu’s Geely, said Tuesday it had received special authorization from the U.S. government to circumvent federal bans restricting vehicle software and hardware tied to China.

Volvo confirmed its special mandate but did not immediately respond to questions about the other bills and their potential impact on the company.

Volvo Cars sold 121,600 vehicles in the USA last year. Mercedes-Benz sold 303,200 passenger cars and 12,400 pickup trucks In the country during the same period.