NIO Refutes US Dept of Defense Claim That It’s Linked To The Chinese Military

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The US Department of Defense has declared that BYD, Nio, CATL, Baidu, and some other large Chinese manufacturers and technology companies are “Chinese military companies” — they have been put on the Department of Defense’s Section 1260H.

NIO, an all-electric vehicle company that sells EVs in Europe and other countries as well as in China, has published a statement vehemently refuting this claim. The statement, published earlier today, reads:

“NIO Inc. (NYSE: NIO; HKEX: 9866; SGX: NIO) (‘NIO’ or the ‘Company’), a pioneer and a leading company in the global smart electric vehicle market, today noted that the U.S. Department of Defense has added the Company to its ‘Chinese military companies’ list (the ‘CMC List’).

“The Company believes its inclusion on the CMC List is not justified as it is not a Chinese military company or a military-civil fusion contributor to the Chinese defense industrial base.

“The CMC List is not a sanctions list. The U.S. government procurement limitations tied to the list will not impact the business of the Company, and the CMC List does not restrict transacting in the securities of the Company.

“The Company will proactively engage with the U.S. Department of Defense to correct this inclusion on the CMC List, including taking legal actions if necessary, to protect the interests of the Company and its shareholders as a whole.”

It’s almost as though NIO executives were offended to be considered a Chinese military company. Some of the other companies published statements disagreeing with the designation as well. Baidu “categorically” denied the claim.

So far, BYD and CATL have not published responses. BYD is the largest electric vehicle producer in the world, and CATL is the largest battery producer.

Funny enough, if we want to put it that way, US automakers actually do have clear ties to the US Military. “Ford and General Motors both hold active DoD contracts: Ford for military vehicle production, GM through its Defence division for light tactical vehicles. These relationships are contractual, publicly disclosed and actively sought by the Pentagon to address manufacturing capacity gaps,” Automotive World writes. “The logic applied to Chinese companies inverts this entirely: BYD and Nio are not listed because they supply the Chinese military—there are no publicly-known connections of this nature whatsoever—but because the US believes that under China’s central planning model, the boundary between civilian and military technological development cannot be trusted to hold.

“Critics, including former senior Trump White House official John McEntee, have pointed out the inherent tension in this reasoning. By the Pentagon’s own logic, Ford and GM would meet the same threshold applied to their Chinese counterparts. It is also noteworthy that both of these companies are allowed to do business in China via joint ventures with state-backed companies; the same cannot be said of Chinese automakers’ ability to sell cars in the US.”

Yes, it all is a bit odd the deeper you dig, isn’t it? And we haven’t even mentioned automaker bailouts and subsidies.

I can certainly see how NIO, Baidu, and others would be frustrated by being added to the Department of Defense’s Section 1260H list — and remember that the agency was recently renamed the “Department of War” by Donald Trump.