The US Department of Defense has added CATL, the world’s largest battery company, to its list of “Chinese military companies” operating in the United States. The designation was made on Monday, and shares in both CATL and its rival Tencent dropped the following day.
CATL denied any association with the Chinese military and stated that it is prepared to contest the decision with legal action if necessary. The company claimed that its designation by the Department of Defense was a mistake, as it has never engaged in any military-related business or activities.
As a result of this designation, CATL’s ability to do business in the US may be affected, although the impact is uncertain. The move also serves as a warning for US businesses that their association with these companies may bar them from future defense contracts.
The Pentagon’s decision could potentially lay the groundwork for tougher sanctions under the Trump administration. In 2021, Xiaomi was removed from the list after taking legal action. Companies have previously managed to reverse the designation when faced with similar challenges.
This move is part of a series of regulatory measures targeting Chinese industry by the Biden administration. Other measures include slapping 100% tariffs on Chinese EVs and proposing banning Chinese software from cars sold in the US. President-elect Donald Trump has also vowed to slap crippling tariffs on goods imported from China, floating a 60% tariff on all Chinese goods during his campaign.
Source: https://www.businessinsider.com/catl-just-added-to-pentagon-blacklist-heres-what-it-means-2025-1