Wrapping up their final days in the White House, the current administration is making some big moves. Today they released their intent to place a total of 77 foreign companies onto the U.S. Department of Commerce Entity List. DJI is on that list.
From the brief description in the official document, it appears DJI was added because they provided drones to the Chinese government that were then used for surveillance of Chinese citizens in ways that violate U.S. human rights guidelines. It is unclear at this time if DJI was aware of the intended use when they supplied the drones, nor even if the drones were simply sold to the government in the same way that the U.S. Government could buy DJI drones, then also fly for illegal use.
As our partners at Android Authority point out, DJI is now on the same list that has been dragging down Huawei.
The Federal Register explains things as thus: “These seventy-seven entities have been determined by the U.S. Government to be acting contrary to the national security or foreign policy interests of the United States. These entities will be listed on the Entity List under the destinations of the People’s Republic of China (China), Bulgaria, France, Germany, Hong Kong, Italy, Malta, Pakistan, Russia, and the United Arab Emirates (U.A.E.).”
We’ve reached out to DJI for comment, stay tuned for an update on what they have to say.
Update: DJI has responded, but only in brief at this time: “DJI is disappointed in the U.S. Department of Commerce’s decision. Customers in America can continue to buy and use DJI products normally. DJI remains committed to developing the industry’s most innovative products that define our company and benefit the world.”
What does it mean for DJI?
We will need some time to dissect all of the implications of this move. We should expect that DJI may need to find new suppliers for some internal components, as they will not be able to purchase things such as Qualcomm chipsets. In addition, it is likely that DJI drones will be removed from store shelves in the United States. At this time, the DJI Store within Amazon is still operational, and most drones are in stock, ready to ship.
Having watched the turmoil that has been plaguing Huawei over the last year, DJI should expect to continue business in parts of the world, but prepare to be limited to only Chinese clients and consumers.
One of the bigger factors for DJI and many other drone brands in China is that Semiconductor Manufacturing International Corp. was also added to the list. This is a local competitor to the likes of Qualcomm in the production of SoC for electronics. Any product globally that uses SMIC chips, not just drones, should expect to be banned in the United States as well.
We are hoping that this mostly blows over, that the next administration re-evaluates the involvement of DJI and others on the Entities list. We respect the other drone brands around the globe, but DJI drones are at the top of most of our best lists for a reason.
Stay tuned for more on this story.