08 April 2025

In a "first strike" towards potential trade and export restrictions, China has placed 11 United States drone makers on the country's Unreliable Entity List.

The list of affected companies, which China has accused of “military technology cooperation with Taiwan,” includes the following:

• Skydio
• BRINC Drones
• Red Six Solutions
• SYNEXXUS
• Firestorm Labs
• Kratos Unmanned Aerial Systems
• HavocAI
• Neros Technologies
• Domo Tactical Communications
• Rapid Flight
• Insitu

The global trade war triggered by President Donald Trump appears to be behind the Chinese action, as Beijing seems ready and willing to go punch for punch with America regarding tariffs and other economic sanctions.

“This action makes clear that the Chinese government will use supply chains as a weapon to advance their interests over ours," said Skydio CEO Adam Bry. "The drone market has historically been dominated by Chinese companies who are now rapidly losing market share to Skydio and our Western peers. This is an attempt to eliminate the leading American drone company and deepen the world’s dependence on Chinese drone suppliers.”

The revolving sanctions between the U.S. and China showcase the broader complexities of the world's high-tech supply chains, as most American drone companies rely on Chinese components. Many firms are now seeking to diversify their suppliers, but there are still risks—as well as resulting stock-price declines—when markets are disrupted by the ongoing U.S.-China trade battles.