Founded in 2015 by Chinese entrepreneurs and backed by Chinese capital, TuSimple was once hailed as a leader in autonomous trucking, boasting a record-setting 80-mile driverless journey in Arizona and partnerships with major firms like UPS and Navistar.

But beneath its rapid rise, TuSimple's dual presence in the U.S. and China created vulnerabilities. According to a Wall Street Journal report, February 2022, the company signed a national security agreement with the U.S. government after concerns emerged about its Chinese ties and potential for technology transfer. 

The agreement, enforced by the Committee on Foreign Investment in the United States (CFIUS), required TuSimple to separate its U.S. operations and technology from China-based employees and partners, build firewalls, and prohibit the sharing of intellectual property. 

Yet, just a week after signing, TuSimple transferred a trove of sensitive data, which included test results and technical blueprints—to Beijing-owned Foton, a major Chinese truck manufacturer.

"They want a lot of details," said TuSimple employee Xiaoling Han in a February 2022 chat.

"It is pretty time consuming."

Internal correspondence shows the data sharing continued up to the six-month compliance deadline. 

WSJ reporter Heather Somerville noted thatTuSimple provided Chinese companies with what essentially constituted a complete autonomous driving system.

This included the source code that serves as the brain of an autonomous truck, in addition to various elements of the design, hardware, and integration of all these systems. 

A CFIUS investigation later found that while the data sharing did not technically violate the agreement, TuSimple was fined $6 million for other infractions. The company did not admit fault, and co-founder Xiaodi Hou insisted that no information prohibited by the company's national security agreement "was ever shared with anyone." 

The fallout was swift. TuSimple shut down U.S. operations, while being delisted from Nasdaq. These events prompted it to move investor funds to China. 

The episode compelled the Trump administration to rethink its reliance on mitigation agreements for high-risk, foreign-connected firms. According to new directives, the White House will "cease the use of overly bureaucratic, complex, and open-ended 'mitigation' agreements" and instead block more China-backed deals outright.