Latest / The Morning Edition / A ‘mega ship’ will deliver 30,000 EVs from China. Just how safe is your data?

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A ‘mega ship’ will deliver 30,000 EVs from China. Just how safe is your data? · The Morning Edition

• 0:04
  S1: If you think that the roads look a little crowded,
• 0:06
  S1: it could be thanks to the 5000 new electric vehicles
• 0:10
  S1: that are due to land this week from China. This
• 0:14
  S1: is just the first part of a shipment expected from
• 0:17
  S1: the Chinese car manufacturing behemoth BYD. The company is due
• 0:22
  S1: to ship another 25,000 EVs here this year. Our desire
• 0:28
  S1: for EVs has spiked massively and understandably thanks to skyrocketing
• 0:33
  S1: fuel prices. But it also comes with some unanswered questions
• 0:37
  S1: and potential complications. I'm Samantha Selinger Morris, and you're listening
• 0:43
  S1: to Morning Edition. From The Age and The Sydney Morning
• 0:46
  S1: Herald today, North Asia correspondent Lisa Visentin on China's dizzying
• 0:52
  S1: technological advances in EVs, robo taxis, flying cars and AI.
• 0:59
  S1: how safe they are and if they come with the
• 1:02
  S1: risk of being spied on. It's June the 1st. Hi, Lisa.
• 1:08
  S1: Welcome back to the podcast.
• 1:10
  S2: Thanks. It's great to be joining you from Beijing.
• 1:12
  S1: Okay. Well, we're lucky you're there because you attended China's
• 1:15
  S1: annual auto show in April. So tell us about some
• 1:19
  S1: of the innovations that you saw on display, because as
• 1:22
  S1: you've written, some of these EV companies are going to
• 1:25
  S1: really quite great lengths to lure in customers, right?
• 1:28
  S2: Exactly right. And it's being driven by an oversaturation of, uh,
• 1:34
  S2: Chinese EV companies. Uh, so there's more than 100 operating
• 1:38
  S2: in China's market. And it's spurred really a furious tech
• 1:42
  S2: race between them to, uh, do whatever they can to
• 1:46
  S2: kind of outcompete their rivals. And that means just jamming
• 1:50
  S2: their cars full as much tech as they possibly can.
• 1:53
  S2: So you're really seeing some very sophisticated interfaces, uh, a
• 1:57
  S2: really smooth integration between your smartphone and your car. BYD,
• 2:03
  S2: the market leader, is, uh, unveiling, constantly unveiling new technology
• 2:09
  S2: to speed up the quickness with which it can charge
• 2:12
  S2: its batteries. So one of the demonstrations that they had
• 2:16
  S2: on display at this year's car show was, uh, its
• 2:19
  S2: five minute flash charging technology. They'd set up frozen cages
• 2:23
  S2: to show that they could put their cars inside these
• 2:26
  S2: sort of essentially frozen boxes to show that they could
• 2:30
  S2: charge their car in, you know, sub 30 degree temperatures.
• 2:34
  S2: I mean, I don't know who's driving an EV in
• 2:37
  S2: those temperatures. Um, but the sales pitch is if you
• 2:40
  S2: want to and you live in a, an ice covered area,
• 2:44
  S2: this shouldn't stop you from buying an EV. Xpeng, another
• 2:48
  S2: Chinese car brand is spruiking its, you know, sort of
• 2:51
  S2: homegrown AI chip that's powering its autonomous vehicles, autonomous driving functions.
• 2:57
  S2: It's got a flying car model that it says it's
• 3:00
  S2: ready to take to the market by next year. There's
• 3:03
  S2: really so much tech around these cars, and if you
• 3:06
  S2: talk to experts, they will say that the Chinese car
• 3:10
  S2: companies are as many of them as there are. And
• 3:13
  S2: the market is certainly oversaturated. This tech race between them
• 3:16
  S2: has really seen them out, clips their Japanese rivals, their
• 3:22
  S2: Korean rivals, their American rivals. And what you can find
• 3:25
  S2: in a Chinese car in terms of their software systems
• 3:28
  S2: is better than what you can find elsewhere.
• 3:31
  S1: Very interesting. And I want to ask you about this
• 3:34
  S1: price war death spiral that you say that a lot
• 3:37
  S1: of Chinese EV brands are now locked in together. There's
• 3:42
  S1: reports that the EV market is oversaturated in China with
• 3:45
  S1: dirt cheap cars. So how has it gotten to this
• 3:48
  S1: point and where will it end?
• 3:50
  S2: So the short answer to that is state subsidies. A
• 3:53
  S2: lot of these, the vast majority of these EV brands.
• 3:56
  S2: And like I said, there's there's more than 100. It's
• 3:59
  S2: a ridiculously oversaturated market are being kept alive. They're being
• 4:04
  S2: kept on life support by very generous Chinese government state
• 4:09
  S2: subsidies offered, you know, through tax incentives, but also local
• 4:13
  S2: government subsidies. And some of these are really winding down now.
• 4:17
  S2: So the future of some of these brands or many
• 4:19
  S2: of these brands is, is really in doubt. And so
• 4:23
  S2: it's spurred this price war to, uh, to get whatever
• 4:27
  S2: kind of market share that they can constantly undercutting each
• 4:31
  S2: other in price. And so some of the cars in
• 4:34
  S2: China are now really very, very cheap. And, you know,
• 4:39
  S2: my experience of just catching the equivalent of Uber here
• 4:42
  S2: in Beijing is that you're getting into cars often. They're
• 4:45
  S2: extremely new. They've just rolled off the production line and
• 4:49
  S2: they've got beautiful leather seats and they're packed full of tech.
• 4:53
  S2: They've got, you know, screens everywhere on the back of seats,
• 4:57
  S2: you know, amazing dashboards. Uh, I got into one where
• 5:01
  S2: I couldn't even work out what button to press to
• 5:04
  S2: try and get into the car. It didn't seem to
• 5:06
  S2: have a handle. And then it all just sort of
• 5:08
  S2: unfolded in front of me. And the roof kind of
• 5:10
  S2: came off and it was, it was like getting into
• 5:13
  S2: this sort of futuristic vehicle. And that's kind of commonplace
• 5:17
  S2: around here. But where it will end, it's unclear, but
• 5:21
  S2: most experts seem to say that there is a huge
• 5:23
  S2: consolidation coming. And the warning is that, uh, as these
• 5:28
  S2: state subsidies wrap up, these companies, many of them are
• 5:31
  S2: called like zombie companies that they are just stumbling along,
• 5:35
  S2: fueled by, fueled by government funding. And when that dries up,
• 5:39
  S2: their future is at risk and that there is a
• 5:41
  S2: big consolidation coming.
• 5:43
  S1: Okay, well, let's get into how this is impacting us
• 5:46
  S1: in Australia or not. I guess the question is, is
• 5:49
  S1: this saturation that's happening in China, in the EV market?
• 5:52
  S1: Has it made its way to Australian shores?
• 5:55
  S2: Well, I think you've seen a huge uptake in interest,
• 5:57
  S2: at least in EVs off the back of the Iraq
• 6:00
  S2: war and the and the petrol crisis. More and more
• 6:03
  S2: EVs are making their way to Australian shores. And part
• 6:07
  S2: of that is because. Well, two factors really. One is
• 6:11
  S2: obviously there's huge competition in China, but. Two, the domestic
• 6:14
  S2: demand in China, uh, has really plummeted off a cliff.
• 6:18
  S2: The Chinese economy is stagnating. And so there's less money
• 6:23
  S2: swishing around here. And so fewer people are buying cars,
• 6:26
  S2: which means that the exporters, in order to, you know,
• 6:30
  S2: stay alive, are having to look further and further afield
• 6:34
  S2: to find markets for their cars. And that means pushing
• 6:36
  S2: heavily overseas. The Australian market is small comparatively, but it's very,
• 6:41
  S2: very attractive because we don't have any barriers to entry
• 6:44
  S2: like tariffs. You know, the same way that, you know,
• 6:47
  S2: the United States does and Europe does, and we want. Well,
• 6:51
  S2: the government wants people to drive EVs. So I think
• 6:55
  S2: that's why you're starting to see a lot more Chinese
• 6:58
  S2: vehicles on the road. And it's why companies like BYD
• 7:02
  S2: are really pushing ahead to entrench their market share in Australia.
• 7:06
  S1: And so you've written that sales here really have shot up,
• 7:09
  S1: I think at least 50% in March. So I guess
• 7:13
  S1: should we be concerned as more and more Chinese EVs
• 7:15
  S1: land on our roads. Like is there a potential security
• 7:19
  S1: risk here? I mean, even espionage.
• 7:21
  S2: The security debate is something that hasn't really happened in
• 7:25
  S2: depth in Australia, but has certainly happened in the United States.
• 7:29
  S2: And it's a bit difficult to know how much of
• 7:33
  S2: it exists in the Or is influenced by the general
• 7:37
  S2: fierce rivalry that is happening between China and the US
• 7:41
  S2: at the moment, and how much of it is a
• 7:43
  S2: genuine security concern, but certainly under the Biden administration, which,
• 7:48
  S2: you know, there there were already existing 100% tariffs, effectively
• 7:52
  S2: locking Chinese cars out of the US. But they also
• 7:56
  S2: put in place further measures to effectively ban Chinese software
• 8:01
  S2: and Chinese hardware from being used in any vehicles to
• 8:06
  S2: hit the roads in the US. And that was based
• 8:08
  S2: on a purely national security justification. You had very senior people,
• 8:14
  S2: including the Commerce Secretary at the time, saying raising the
• 8:18
  S2: specter of, you know, could Beijing, essentially, by the flick
• 8:21
  S2: of a switch, turn off cars on the roads in
• 8:24
  S2: the US, and that this was handing a great deal
• 8:27
  S2: of data because these cars, because they're so connected, suck
• 8:31
  S2: up a lot of data. Was this handing a great
• 8:33
  S2: deal of data advantage to Beijing? This is not something
• 8:37
  S2: that has played out in Australia. It seems, from what
• 8:40
  S2: we can tell, that the Australian government has made a
• 8:42
  S2: call that the advantages that Chinese tech and Chinese EV offers. Australia,
• 8:48
  S2: in terms of meeting climate goals is something that's more
• 8:51
  S2: important at this stage. But behind the scenes, of course,
• 8:54
  S2: we don't really know what kind of conversations have been
• 8:57
  S2: had and how extensively they've been had about these security concerns,
• 9:02
  S2: but I would note that even recently, a decision has
• 9:06
  S2: been made to allow federal MPs to use Chinese vehicles
• 9:10
  S2: as part of the government fleet. So that gives us
• 9:13
  S2: an indication of of where the Australian government sees things.
• 9:21
  S1: After the break.
• 9:22
  S2: Where some of these concerns really arise in the China space,
• 9:26
  S2: is that there are national security laws here in China
• 9:29
  S2: that effectively allow the government to demand entry to these
• 9:35
  S2: data sets and to systems if they want to.
• 9:43
  S1: Okay, so is this surprising at all to you? Because
• 9:46
  S1: you've mentioned the US has banned the use of Chinese
• 9:48
  S1: software and hardware in EVs because of security concerns. And
• 9:53
  S1: you've written that, you know, these Chinese EV companies, some
• 9:55
  S1: are coupling up with tech giants like Huawei and the
• 9:58
  S1: AI juggernaut Deep Sea. So AI is embedded everywhere in
• 10:02
  S1: these cars. So why has our government and in particular,
• 10:06
  S1: Energy Minister Chris Bowen championed this uptake of these EVs?
• 10:10
  S1: Like on that level, it sounds a bit strange.
• 10:12
  S2: Yeah. And Huawei right. Um we'll all remember was effectively
• 10:16
  S2: banned from having any involvement in Australia's 5G rollout. Uh,
• 10:21
  S2: and deep sea has been banned from, uh, government phones
• 10:24
  S2: in Australia. So there's a little bit of a disjuncture
• 10:28
  S2: or discordance there between these two policies. I do think
• 10:32
  S2: there's probably a more sophisticated analysis to be done by,
• 10:36
  S2: you know, people who are far more across the technological
• 10:40
  S2: impacts of these things than me. I mean, simply because
• 10:44
  S2: Huawei was banned from our 5G rollout, which is a
• 10:46
  S2: critical technology. Doesn't necessarily mean it poses the same kind
• 10:50
  S2: of risk if it's, you know, used in the interface
• 10:53
  S2: in cars. But you do have serious people. For example,
• 10:57
  S2: I spoke with Simeon Gilding. He was a former director
• 11:00
  S2: general of one of our top spy agencies, the Australian
• 11:04
  S2: Signals Directorate, and he was involved in what he really led. Actually,
• 11:09
  S2: the agency's advice that Huawei should not be allowed entry
• 11:13
  S2: into Australia's 5G market. He has raised concerns that governments
• 11:18
  S2: need to answer this question about whether Chinese EVs should
• 11:21
  S2: be considered critical infrastructure. You know, are they at the
• 11:24
  S2: point where they can collect so much data and hoover
• 11:28
  S2: up so much data that they should be classified as
• 11:31
  S2: critical infrastructure in this way, particularly as more and more
• 11:34
  S2: Chinese cars hit the road. And do we need to
• 11:36
  S2: start thinking about whether they should be regulated? He. He
• 11:39
  S2: doesn't have a definitive answer on that. He's not trying
• 11:41
  S2: to shape policy in a particular direction. He's just posing
• 11:45
  S2: that this is a question that governments should answer at
• 11:48
  S2: some point. These cars, because they are so connected, they
• 11:51
  S2: do really hoover up a lot of information, a lot
• 11:54
  S2: of information on battery health along your destination. They have
• 11:59
  S2: cameras everywhere. They can possibly record where you're going to
• 12:03
  S2: and from and capture the surroundings of where you're going.
• 12:07
  S2: Our home affairs Minister, Tony Burke, drives a Chinese EV,
• 12:11
  S2: and he has been advised by Australia's security agencies to
• 12:14
  S2: not plug in his phone. So this gives you an
• 12:16
  S2: indication that there are real concerns there for the average consumer.
• 12:22
  S2: For the average driver, this may not be such an issue.
• 12:24
  S2: I mean, we're handing over our data left, right and centre,
• 12:28
  S2: not just to Chinese companies, but to, you know, to
• 12:31
  S2: meta to to all the US tech giants where some
• 12:35
  S2: of these concerns really arise in the China space is
• 12:38
  S2: that there are national security laws here in China that
• 12:42
  S2: effectively allow the government to demand entry to these data
• 12:47
  S2: sets and to systems if they want to. And so
• 12:50
  S2: all of these concerns about data and how it's being
• 12:53
  S2: stored and how it might be used, center around those
• 12:57
  S2: laws and the capacity that the Chinese government has to
• 13:00
  S2: go in and grab it. Not that we know whether
• 13:03
  S2: that's ever happened. Most of these tech companies, Chinese tech companies,
• 13:07
  S2: will always assert their independence and say that they store
• 13:10
  S2: things safely. But that's where the concerns arise.
• 13:13
  S1: Okay. It's so interesting. And in particular, what you said
• 13:16
  S1: about the Home Affairs Minister, Tony Burke, being advised, you know,
• 13:19
  S1: not to plug in his phone into his Chinese EV.
• 13:23
  S1: So I guess the question is, you know, could we
• 13:25
  S1: see Australia's stance on security around EVs change, particularly given
• 13:29
  S1: that the Albanese government has already banned the Chinese AI
• 13:33
  S1: juggernaut Deep Sea from government issued devices, right?
• 13:37
  S2: It's a good question. And I think, you know, it's
• 13:40
  S2: one that at this stage it looks like, no, they're
• 13:43
  S2: not going to move in that direction. And there's also
• 13:46
  S2: a point of diminishing returns, uh, so to speak. I mean,
• 13:50
  S2: Chinese cars are, you know, getting towards a saturation point
• 13:54
  S2: where it's going to be very difficult to bring in
• 13:57
  S2: regulation after the fact. Right. You know, BYD is on
• 14:01
  S2: track to become, you know, the second or third biggest
• 14:04
  S2: selling car brand in Australia this year, which is really
• 14:08
  S2: an extraordinary achievement given that it was not even in
• 14:11
  S2: the market five plus years ago. So if you wanted
• 14:15
  S2: to move on this, you needed to move kind of
• 14:18
  S2: yesterday rather than trying to bandaid over it after the fact.
• 14:22
  S1: Very interesting. And just to wrap up, Lisa, I really
• 14:24
  S1: want to ask you what it's like there on the
• 14:26
  S1: ground in Beijing when you've had this experience of being
• 14:30
  S1: in these connected electric vehicles. I mean, you spoke about
• 14:33
  S1: stepping into one, which sort of sounded like it was
• 14:35
  S1: like an origami machine or something. So I guess, what
• 14:39
  S1: is it like when you're there living in such a
• 14:41
  S1: highly connected society, knowing that technology may be watching your
• 14:45
  S1: every move? Do you think Australians in Australia should be
• 14:49
  S1: concerned at all?
• 14:51
  S2: It is funny describing it as an origami. It really
• 14:53
  S2: did kind of unfold in that way. Uh.
• 14:56
  S1: It sounded like it. I mean, it sounded wild.
• 14:58
  S2: The tech, the tech is really impressive. And, you know,
• 15:01
  S2: one of the things near me, there's a taxi cab rank.
• 15:04
  S2: All the taxi here are electric vehicles. And so there's
• 15:09
  S2: a charging rank where they just plug in. I was
• 15:11
  S2: walking through the hutongs in Beijing the other day. The
• 15:14
  S2: hutongs are like the old Beijing, and you go there
• 15:17
  S2: to see what Beijing sort of used to be like.
• 15:19
  S2: And they're connected by these ancient alleyways. But, you know,
• 15:22
  S2: embedded in that are BYD charging stations where people are charging,
• 15:27
  S2: you know, their bikes and they're charging their EVs. And
• 15:31
  S2: that's the other thing here. There really are no motorbikes
• 15:34
  S2: on the road like you might see in other parts
• 15:36
  S2: of Asia. You might see in Kuala Lumpur or the
• 15:38
  S2: Philippines the noise of motorbikes. Everyone hears riding an e-bike.
• 15:43
  S2: So China is very, very much plugged into the electric
• 15:48
  S2: vehicle revolution in terms of being watched for your every move.
• 15:53
  S2: It's weird because you become accustomed to it. You become
• 15:56
  S2: accustomed to handing over your ID and your passport whenever
• 16:00
  S2: you catch a train here, your passport is your ticket.
• 16:03
  S2: There are security cameras on every corner. Facial recognition is
• 16:08
  S2: used everywhere. Uh, it's so embedded in daily life that
• 16:12
  S2: you really get used to it. And I think it's
• 16:15
  S2: only when you. It's only when you need to cover
• 16:18
  S2: something sensitive or when you have cause to suddenly be
• 16:23
  S2: aware of the fact that you're being watched, that it
• 16:25
  S2: really hits home how much data is being collected on you.
• 16:29
  S2: You know, every move that you make.
• 16:34
  S1: Wow. That's startling that that how you become so accustomed
• 16:38
  S1: to it. But at the same time, when I give
• 16:39
  S1: it a moment, I think, yep, that's that's how we are.
• 16:41
  S3: Yeah, exactly.
• 16:42
  S1: Well, we're so lucky you are there on the ground
• 16:44
  S1: reporting on this and everything else. So thank you so much, Lisa,
• 16:48
  S1: for your time.
• 16:48
  S2: No worries. Thanks for having me.
• 17:03
  S1: Today's episode was produced by Josh towers. Our executive producer
• 17:07
  S1: is Tammy Mills, and our podcasts are overseen by Lisa
• 17:11
  S1: Muxworthy and Tom McKendrick. If you like our show, follow
• 17:15
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• 17:17
  S1: Apple or Spotify. Thanks for listening.