The world leader of drones, the Chinese DJI, a target of US sanctions

The world’s leading producer of drones, the chinese company DJI, is subject to new sanctions of U.S, which has suspected since last year that the company made possible the alleged human rights violations against the Uighur minority.

Created in a bedroom

DJI took shape in the early 2000s in the bedroom of Wang Tao, the current CEO of the company, when he was a student at Hong Kong University of Science and Technology.

Elusive with the media, Wang Tao, a native of eastern China, also calls himself Frank Wang.

Having created his first prototypes in his student room, he created DJI in 2006 in Shenzhen, the southern metropolis called the “Silicon Valley of China.”

Takeoff

DJI is experiencing rapid growth and in 2015 becomes the world’s largest manufacturer of drones for the general public.

Its advances make it possible to democratize drones with very varied uses (aerial photography, video, agriculture, rescue operations, public security …).

DJI’s market share is between 70-80% in 2020, according to various analysts. Its business volume is close to US $ 3,000 million.

Shanghai’s Hurun Cabinet, which specializes in assessing personal wealth, estimates Wang Tao’s fortune at 48 billion yuan (about $ 7.5 billion).

Suspicions from the US.

DJI’s growing success began to be frowned upon by the United States, which does not have a company capable of rivaling the Chinese group and also fears for national security.

Millions of Americans use DJI drones, as well as some government agencies in the country, to monitor wildlife or military activities.

So DJI could potentially collect thousands of sensitive data on US soil. Additionally, Western cybersecurity companies spotted security flaws in DJI’s mobile apps.

The Chinese firm denied any malicious intent and carried out corrections and updates.

goals

The pressure mounted after the 2016 election of US President Donald Trump.

In 2017, the United States Department of Defense banned DJI products from the military. In 2019, the Department of Homeland Security alerted of security risks related to Chinese drones.

In December 2020, the United States imposed restrictions on the export of American technology on dozens of Chinese companies, including DJI, over their alleged ties to the Chinese military and security services.

Washington accuses DJI of allowing “large-scale human rights violations in China” by collecting data. The Shenzhen firm says it has “nothing to justify” such accusations.

And now?

The new sanctions that the United States decided on Thursday criminalize any American investment in DJI.

What happened with Huawei, the Chinese telecommunications giant, subject to numerous sanctions from Washington, suggests the effects of these measures.

Accused under the presidency of Donald Trump of being able to spy potentially by order of Beijing, Huawei was prohibited from buying key US technologies such as electronic chips, as well as using the Android exploitation system (from Google) on its cell phones.

The United States and some of its allies also banned the Chinese company from accessing its 5G networks.

This caused a reduction in cell phone sales and Huawei’s business volume. So the firm has had to diversify (computer programs, smart vehicles …).