Pentagon Blacklists Tencent, Largest Chinese Ev Battery Maker

The Defense Department has added dozens of Chinese firms to a list of companies that are prohibited from working with the Pentagon and defense industry due to their alleged ties with China's military, including the massive tech firm Tencent.

The updated blacklist, published Tuesday on the federal register, also includes the company Contemporary Amperex Technology Co. Ltd. (CATL), which makes batteries for Tesla, the electric car company owned by billionaire Elon Musk, a close ally of President-elect Trump.

The list additionally includes Chinese drone company Autel Robotics, which, along with company DJI, has attracted intense scrutiny on Capitol Hill for national security concerns.

The companies now considered as Chinese military firms work in a variety of sectors, including the semiconductor chip industry, telecommunications, machinery and technology.

Both CATL and Tencent have denied working with the Chinese military, known as the People's Liberation Army.

CATL, the largest electric vehicle battery maker in the world, said in a statement that it "has never engaged in any military-related business or activities, so this designation by the Department of Defense is a mistake."

The designation "does not restrict CATL from conducting business with entities other than DoD and is expected to have no substantially adverse impact on our business," the company said.

"We will proactively engage with DoD to address the false designation, including legal action if necessary, to protect the interests of our company and shareholders as a whole," it added.

Tencent, which owns several popular video games and tech platforms like messaging service WeChat, said in a statement that it was "neither a Chinese military company nor a military-civil fusion contributor to the Chinese defense industrial base."

Tencent called its inclusion on the blacklist a "mistake" and said it would work to resolve the issue with U.S. officials. The Chinese company said its business would not be affected because the list only prohibits working with the Pentagon and defense industry.

The U.S. and China have engaged in more provocative actions against each other in the past few months, with the Biden administration restricting Chinese access to technology like semiconductor chips and Beijing adding American companies to its sanction list.