U.S. Considers Ban On Chinese Drones For National Security Reasons

The Commerce Department’s Bureau of Industry and Security (BIS) is considering a new rule to restrict or ban Chinese drones in the United States due to national security concerns.

Chinese companies, and in particular the giant DJI, which dominates the industry, account for over 75% of the U.S drone market, including more than 90% of hobby drones. Banning them would upend the industry and create a huge vacuum.

Whether or not to impose restrictions will fall to the incoming Trump administration. What are the issues and the possible outcomes?

How China Won The Drone Race

Back in the early 2010s, there were several major U.S. companies competing in the domestic drone market, including 3D Robotics, Skydio and Teal. But Shenzhen-based Dai-Jing Innovations (DJI) was able to outcompete all of them. The company’s Phantom drone, released in January 2013, was easy to fly out of the box and made aerial photography accessible to everyone.

DJI succeeded in scaling up its operation, vertically integrating so that cameras and other electronics exactly fit its requirements and the company did not need to engineer drones around existing components. The company plowed its profits back into R&D and employed a small army of developers to produce highly capable, user-friendly software.

DJI broke developed new markets, with hobbyists, photographers, filmmakers adopting its small drones, while new heavy drones served the agricultural, industrial and first-responder markets. DJI’s latest product, the sub-$200 Neo, is a drone for people who do not want a drone, an airborne selfie-camera which flies itself. The Neo is marketed for vloggers and others who want to create innovative video content easily; Engadget called it “camera of the year.”

Faced with DJI’s economies of scale, speed of innovation and ability to market advanced products at low cost, the U.S. companies were forced to retreat. Teal and Skydio both left the hobby drone market for the safer haven of government contracts, which are less sensitive to pricing and where security is a major factor. For some years lawmakers have been expressing concerns about relying on Chinese hardware that communicates directly back to its home country.

Not Safe In Our Army

DJI’s Mavic quadcopters, which fold up to fit in a cargo pocket and can carry out aerial scouting missions against targets a mile away, quickly became popular with military users — they’re easier to use and more affordable than other offerings from the defense sector. In 2017, Israel issued DJI Mavics to infantry companies.

But later that same year the U.S. Army banned service members from using DJI drones citing “increased awareness of cyber vulnerabilities.” In 2018, the Pentagon issued a blanket ban on all commercial consumer drones in the military for the same reason. The FY20 National Defense Authorization Act (NDAA) set out exceptions allowing such drones to be bought in some cases, but the concerns have continued and escalated.

DJI has a large legal team and it does not take challenges lightly. When the Pentagon added the company to a list designating it as a “Chinese military company,” DJI hit back with a lawsuit, saying it “is neither owned nor controlled by the Chinese military.”

But the Senate is not convinced and gave DJI a year to prove that they are not a national security risk – and that was before the new rule proposed by the Commerce Department.

It is worth noting that DJI drones are widely used in the Ukraine conflict — against the company’s objections that their drones should never be used for military purposes — but these are extensively hacked before being deployed, to negate security issues.

The Drone Threat

How serious is the threat posed by Chinese-made drones? They are not going to rise up and attack, but the Commerce Department is asking for comment on the real risks before formulating its rules.

Specifically Commerce is seeking to discover if using Chinese-made drones “poses an undue risk of sabotage to or subversion of the design, integrity, manufacturing, production, distribution, installation, operation, or maintenance of information and communications technology or services in the United States” or “poses an undue risk of catastrophic effects on the security or resiliency of United States critical infrastructure or the digital economy of the United States.”

The biggest issue is that the drones regularly communicate with the manufacturer via the internet, and makers issue regular firmware updates.

This certainly makes it possible for makers, and through them the Chinese government, to get flight logs showing when and where drones were flown. In theory they might be able to download images from the drones for espionage purposes.

More realistically, firmware updates can include “geofencing” information to stop drones from flying in defined areas. These normally keep them away from airports and other sensitive locations, but can block off wider areas. In 2017 DJI placed geofences across much of Iraq and Syria in response to reports of ISIS using DJI drones to drop bombs. A similar update might effectively ground Chinese drones in the U.S..

Hobby drones are not the issue. Drones are widely used for smart agriculture, providing day-by-day data on each field, as well as inspecting pipelines, powerlines, bridges and other infrastructure. Drones play a crucial role in tracking wildfires and monitoring floods and other natural disasters. Some drones are starting to be used for medical and cargo delivery, and this is likely to increase over the next few years usage in all these areas, creating a greater dependence on drones. Nobody wants an adversary to be able to turn off these capabilities at will.

DJI and other companies argue that they are not controlled by the Chinese government. In March, the new U.S. administration may decide otherwise and impose a rule banning their import in the U.S..

What Happens If…?

When the Pentagon banned Chinese drones, it instituted the Blue UAS project, which gives military buyers a list of safe, certified, U.S.-made drones to choose from. This boosts the U.S. drone industry and ensures security, but at a price. At current scales, nobody can compete with DJI.

As the drone economy is taking off and everyone else takes advantage of efficient, low-cost hardware made in China, American buyers may find themselves shut out. DJI’s new FlyCart 30 can deliver a sixty-pound cargo to a site 10 miles away and is available for $20,000. There is currently nothing remotely comparable from a non-Chinese supplier.

The question is whether U.S. companies can step in and fill the vacuum. Or whether it simply will not be profitable for them to try. The challenges of starting from scratch, and the fact that they will have to compete with China in the export market, may be too much too bear.

Meanwhile the CES 2025 show at Las Vegas is showcasing a tempting array of new Chinese drones — maybe for the last time.