The Pentagon has added CATL, the world's largest EV battery manufacturer, to its blacklist of companies allegedly tied to the Chinese military. This designation will prevent CATL from working with the U.S. Department of Defense and local U.S. businesses with military contracts starting in June 2026. CATL denies any military involvement and plans to dispute its inclusion on the list. The news triggered a significant drop in CATL's market value.
The Pentagon 's updated list includes 134 companies that have some business operations within the US. CATL is licensing its battery technology to Ford for its planned $3.5 billion battery plant. News of CATL being added to the list slashed its market value by roughly $4.
4 billion. CATL, the world’s largest manufacturer and supplier of EV batteries, is one of several companies that the Pentagon will blacklist in June 2026 for alleged ties to the Chinese military. Tencent – China’s largest tech firm – has also been added to the list, meaning it will be unable to work with the U.S. Department of Defense and local U.S. businesses with military contracts. The updated list now includes 134 companies, all of which have some business operations within the United States. CATL denies being a Chinese military company and said it’s planning to dispute its inclusion in the list. It may also pursue legal action after the move contributed to a 2.8% drop in its share price, cutting its market value by $4.4 billion. Read: CATL Drives China’s EV Battery Network Expansion With 1,000 New Stations Speaking with The New York Times, a CATL spokesman said the company has “never engaged in any military-related business or activities” and that being added to the Defense Department’s ‘1260H list’ “does not restrict CATL from conducting business with entities other than the Department of Defense and is expected to have no substantially adverse impact on our business.” Many of the world’s most popular EVs use batteries sourced from CATL, and even some Teslas sold in several markets have CATL batteries. The business is also licensing its battery technology to Ford, which will use the tech to build battery packs at a $3.5 billion factory in Michigan. According to senior China fellow at the Foundation for the Defense of Democracies, Craig Singleton, CATL’s control of data collected by EV charging stations and battery management systems may allow for Chinese government spying. He told The Washington Post that Chinese law requires CATL to provide government access to all of its proprietary and customer data. The updated list was published shortly after China’s Commerce Ministry added 10 US firms to its “unreliable entities list.” In 2021, Xiaomi was added to the 1260H list but successfully sued the Pentagon and was removed, arguing it had no ties to the Chinese military. The inclusion of Tencent on the list is also notable. It owns WeChat and is valued at more than $480 billion. After news broke of it being in the crosshairs of the Defense Department, its shares fell by approximately 7.3%, slashing $35.4 billion from its market value.
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