The Senate Commerce Committee advanced bipartisan legislation Wednesday aimed at banning Chinese automakers from the U.S. market, though Chairman Ted Cruz warned the Motor Vehicle Modernization Act of 2026 could unintentionally bar Mercedes-Benz from selling vehicles in the country. Cruz stated during the committee's markup that the bill's 15% Chinese ownership threshold would cover Mercedes-Benz because two Chinese investors collectively own nearly 20% of its shares. The bill would codify federal restrictions intended to keep Chinese-linked vehicle technology out of the U.S. over national security concerns that connected cars could collect sensitive data.
Senate Committee Advances Bill Targeting Chinese Automaker Ownership
The Senate Commerce Committee advanced the Motor Vehicle Modernization Act of 2026 during its Wednesday markup session. Chairman Ted Cruz, R-Texas, stated the bill's 15% Chinese ownership threshold would cover Mercedes-Benz because two Chinese investors collectively own nearly 20% of its shares. Cruz said, "We would never consider" banning Mercedes-Benz, adding that the bill would need to be changed before becoming law.
Sen. Bernie Moreno, R-Ohio, who introduced the bill with Sen. Elissa Slotkin, D-Mich, said, "We're preventing an absolute, total, and complete destruction of our industrial base." The legislation aims to codify federal restrictions intended to keep Chinese-linked vehicle technology out of the U.S. over national security concerns that connected cars could collect sensitive data.
Mercedes-Benz Chinese Shareholders Hold Nearly 20% Stake
Mercedes-Benz's two largest individual shareholders are Chinese state-owned automaker BAIC, formerly the Beijing Automotive Industrial Corp., with a 9.98% stake, and Geely founder Li Shufu, with 9.69%. The combined ownership of 19.67% exceeds the bill's proposed 15% threshold for Chinese ownership.
Mercedes-Benz previously declined to comment on the legislation but said it employs more than 10,000 people in the U.S. and operates assembly plants in Alabama and South Carolina.
Bill Sets 2030 Compliance Deadline with Waiver Option
Moreno said during the markup that Mercedes-Benz would have until 2030 to comply with the ownership limit and could seek a waiver. The bill would require automakers exceeding the 15% Chinese ownership threshold to divest or restructure their ownership to continue selling vehicles in the U.S. market.
Cruz Accuses GM of Competitive Motive Behind Provision
During the markup, Cruz accused General Motors of supporting the provision in an effort to weaken Mercedes-Benz and make Cadillac more competitive. "GM is pushing for this provision to get Mercedes-Benz out of the market," Cruz said. GM is the top-selling automaker in the U.S.
GM and Mercedes-Benz did not immediately respond to requests for comment.
FAQ
What is the Chinese ownership threshold in the Motor Vehicle Modernization Act of 2026?
The bill sets a 15% Chinese ownership threshold for automakers selling vehicles in the U.S. market. Companies exceeding this limit would be required to comply by 2030 or seek a waiver.
How much of Mercedes-Benz do Chinese investors own?
Chinese investors collectively own nearly 20% of Mercedes-Benz shares. BAIC holds a 9.98% stake and Geely founder Li Shufu holds 9.69%, totaling 19.67%.
When would Mercedes-Benz need to comply with the ownership limit?
Sen. Bernie Moreno stated during the committee markup that Mercedes-Benz would have until 2030 to comply with the ownership limit and could seek a waiver.
