In a recent development, a Nasdaq-listed Chinese technology company called Hesai Technology has threatened to sue the U.S. government after being included in a list of companies that the Pentagon claims have ties to the Chinese military. Hesai Technology specializes in producing LiDAR road sensing equipment for self-driving vehicles and other applications. The company’s inclusion on the list came without any explanation, prompting Hesai CEO Yifan “David” Li to describe the move as “unjust, capricious, and meritless.” Hesai argues that its products are for civilian use only and have never been designed or validated for military purposes. The company plans to file a lawsuit to contest its inclusion on the list.
The U.S. Department of Defense regularly updates its list of Chinese military companies to counter links between the Chinese military and civilian entities. The revised list includes 17 companies, including Hesai Technology, Megvii (an AI company), IDG Capital (a private equity investment company), and several major Chinese energy, telecoms, and aviation companies. It is worth noting that some of these companies have investments from U.S. pension funds and foundations. Hesai’s stock price has fallen significantly over the past year, from about $22 to $4.
This situation reflects ongoing tensions between the U.S. and China in the technology and trade sectors. The Biden administration has maintained the tariffs imposed by former President Donald Trump and has also limited China’s access to advanced U.S. technology and investments in strategically sensitive Chinese industries. The Defense Department’s inclusion of companies like Hesai Technology on its list further exacerbates these tensions. China’s foreign and commerce ministries have already protested the move, while Hesai Technology plans to take legal action to challenge its inclusion on the list.
