The river already sounded at the end of 2025: the Pentagon agreed that Chinese giants such as Alibaba, BYD, and Baidu were linked to the Chinese Army. At the time, it was unclear whether these companies would be included on the Pentagon’s 1260H list. However, it served as a warning, surfacing just three weeks before Donald Trump and Xi Jinping solidified a trade truce.
Initially, it appeared that tensions were easing, particularly with recent developments like Nvidia’s ability to market its H200 GPUs for AI and Trump’s visit to China with a delegation of U.S. CEOs aimed at promoting balance in trade relations.
However, the news took a dramatic turn. According to Reuters, Alibaba, BYD, and Baidu now feature on the Pentagon’s blacklist. Furthermore, they aren’t the only companies added.
Many More Chinese Companies on the Pentagon’s Blacklist
The update to the 1260H list had long been anticipated. The indications from November served as a precursor but without any decisive action. Now, just one month post-Trump’s diplomatic visit to Beijing, the Pentagon has officially rolled out a revised list, highlighting profound changes.
Alibaba, BYD, and Baidu now belong to a select group of companies that are barred from entering into contracts with the United States Department of Defense.
What exactly does this entail? The blacklist includes several companies across varying sectors. Both Alibaba and Baidu operate in the Internet realm—akin to having Amazon and Google flagged simultaneously—while other notable mentions include BYD (specializing in automobiles and batteries), CXMT and YMTC (focusing on semiconductors and RAM), Unitree and RoboSense (in the robotics field), and WuXi AppTec (working in biotechnology).
This list is particularly intriguing since these companies actively compete against American or Taiwanese firms. Recently, CXMT and YMTC were highlighted as viable RAM suppliers, especially during the ongoing component crisis crippling traditional supply routes.
Robotics and Military Applications
The United States and China are embroiled in a technological war over robotics, with Unitree emerging as a frontrunner in humanoid and quadruped robotics, which are under exploration for military applications. Recently, Nvidia announced plans to collaborate with Unitree for advanced robot development.
Additionally, China BlueChemical Limited, a branch of CNOOC, and Baicells, a telecommunications equipment manufacturer, have also made the list.
While there are currently no direct sanctions against these companies akin to those imposed on Huawei, U.S. law makes it clear that starting this month, the Department of Defense cannot engage with them directly. By 2027, they will be entirely barred from acquiring their products or services through third-party channels.
Reactions from Chinese Companies
How are the companies responding? Reports from Reuters and The Guardian reveal that Alibaba contests the Pentagon’s claims, arguing it is “not a Chinese military company nor part of any military-civil fusion strategy.” The company vows to “pursue all available legal actions against attempts to tarnish” its reputation.
Baidu echoes these sentiments, deeming the notion that it’s a military entity as “completely unfounded.” The company indicates readiness to take immediate steps for removal from the blacklist. WuXi AppTec has hinted that delisting could be possible, contingent on significant changes such as withdrawing from the U.S. market or rebranding itself.
“These Chinese companies are working with the Chinese military against our national interests” – John Moolenaar
According to Pentagon officials, publicly traded companies possess the option to request reclassification from the “Chinese military companies” list.
House Select Committee Chairman John Moolenaar emphasized that the updated list serves as a significant warning aimed at American companies and citizens alike, emphasizing, “these Chinese companies are collaborating with the Chinese military in opposition to our national interests.”
As noted by Craig Singleton, an expert in U.S.-China relations, Washington no longer views these Chinese companies simply as independent entities but as integral components of a strategic conglomerate aligned with the Chinese government.