Electric car maker BYD has been added to the BYD Pentagon military list, formally known as the Section 1260H list, alongside technology companies Alibaba and Baidu in an update announced via the Federal Register on Monday. The US Department of Defense publishes the list to alert American organisations to the risks of doing business with firms it identifies as contributing to China’s military-civil fusion strategy.
The updated list now names 188 companies that the Pentagon identifies as operating in the United States and contributing to China’s military-civil fusion strategy, according to The Next Web. That figure marks a substantial expansion from the previous update: on 6 January 2025, the Department of Defense had brought the total to 134 entities spanning sectors including artificial intelligence, aerospace and biotechnology, as reported by law firm Hogan Lovells.
What the BYD Pentagon military list designation means in practice
Inclusion on the list does not amount to an immediate sanction. As law firm Morgan Lewis notes, being named to the list, by itself, does not prohibit US businesses from continuing to do business with the companies named. The list functions primarily as a risk-disclosure mechanism rather than a trade prohibition, though reputational and contractual consequences for listed firms can follow.
BYD, Alibaba and Baidu were among companies accused of serving as military-civil contributors to Chinese defence operations. The US appears to have flagged these companies for their participation in state programmes rather than on the basis of clear evidence of contracts with the Chinese military, according to policy analyst Stefanie Kam from the Nanyang Technological University.
BYD does not export its cars to the US, yet the company surpassed Tesla earlier this year to become the world’s top EV maker. Its inclusion signals that the Pentagon’s concern extends to commercial competitiveness as well as direct security exposure. Other electric vehicle makers on the current list include Nio, while aircraft manufacturer Comac also features. Robotics company Unitree was among the newly added entities in this update, The Next Web reported.
Chinese government and company responses
The Chinese embassy in the US told the BBC that the list is ‘discriminatory’ and said firms from China have strictly complied with the laws abroad. Alibaba’s representatives said separately that ‘there is no basis for their companies to have been listed.’ A spokesperson for the company stated: ‘Alibaba is not a Chinese military company nor part of any military-civil fusion strategy. We will take all available legal action against attempts to misrepresent our company.’
Baidu’s response was equally pointed. A spokesperson said ‘there is no credible justification’ for its inclusion and that the company will ‘use all options available’ to have its name struck off the list. The BBC said it had contacted BYD and several other firms on the list for comment.
Stefanie Kam said Beijing will likely view the move as a ‘form of economic containment.’ She added that China could possibly retaliate with tit-for-tat sanctions, add American firms to a list of its own, or respond with some form of diplomatic pushback.
A growing list with established precedents
The Pentagon’s Section 1260H list now includes more than 80 Chinese military companies directly or indirectly engaged in providing commercial services in the US, with some competing directly with American companies in electric vehicles and artificial intelligence. Companies including Tencent, Huawei, drone producer DJI and battery maker CATL, which were added in previous rounds, remain on the list.
The Huawei precedent looms over the current additions. In 2019, Washington barred US firms from doing business with Huawei over national security concerns linked to its equipment. Huawei has denied claims that using its products presents security risks and says it is independent from the Chinese government. Whether the firms newly added to the BYD Pentagon military list pursue similar legal challenges or diplomatic routes will depend on the specific grounds each company contests, with Alibaba and Baidu already signalling they intend to act.
