Mercedes-Benz could be barred from manufacturing and selling vehicles in the U.S. under new legislation targeting Chinese ownership in the auto industry, according to CNBC.
Named the Motor Vehicle Modernization Act of 2026, the legislation would block any automaker from importing, selling, or manufacturing vehicles for sale in the U.S. if a foreign-adversary government holds "any direct or indirect equity interest" in that company. The legislation is sponsored by House Energy and Commerce Committee Chairman Brett Guthrie, a Republican from Kentucky, and is currently a House-only initiative with no Senate companion.
BAIC — formerly known as the Beijing Automotive Industrial Corp. and owned by the Chinese government — holds a 9.98% stake in Mercedes-Benz, making it the automaker's single largest individual shareholder, according to CNBC. An additional 9.69% of Mercedes-Benz shares is controlled through Tenaciou3 Prospect Investment, the vehicle used by Li Shufu — the Chinese billionaire who founded and chairs Geely — to hold his position in the company. Together, Li Shufu and BAIC account for a 19.67% ownership stake in Mercedes-Benz Group AG.
Among those CNBC spoke with who have knowledge of the legislation, two said the bill in its current form would result in a ban on the company, while others pointed to ambiguities in its language that could produce the same outcome depending on interpretation. "The language is unambiguous," a former automotive policy advisor and lobbyist who was consulted about the bill told CNBC.
While the bill carves out a potential exemption for automakers with at least five years of U.S. passenger vehicle production prior to Jan. 1, 2026, that protection is explicitly voided for any company in which a foreign-adversary government holds a direct or indirect equity stake. China is listed as a foreign adversary alongside Russia and North Korea.
Asked about the bill's reach, Daniel Kelly, the Energy and Commerce Committee's press secretary, verified the legislation's provisions to CNBC while stopping short of addressing what it could mean for any specific automaker. A representative for the automaker told CNBC the company had no comment, pointing to an internal policy that precludes it from weighing in on active legislation.
The company's U.S. footprint includes two large assembly facilities and a workforce exceeding 11,000 Americans. Its Tuscaloosa, Alabama facility — the largest of its domestic plants — has rolled out more than 4.5 million vehicles in the roughly three decades since it began production in 1997.
Another ownership-focused measure, the Connected Vehicle Security Act of 2026, was put forward in the Senate by Sens. Bernie Moreno (R-Ohio) and Elissa Slotkin (D-Mich.) and draws a 15% threshold for foreign ownership — though what exemptions, if any, will apply under that bill remains unresolved. Should exemptions prove narrow, the 15% clause in that bill could sweep in other automakers tied to Chinese investors — among them Volvo — according to CNBC.