China Has a New Playbook to Counter Trump: ‘Supply Chain Warfare’

In the world of cheap drones, Skydio was the great American hope. Its autonomous flying machines gave the U.S. defense and police agencies an alternative to Chinese manufacturers, free from the security concerns tied to dependence on Chinese supply chains.

But Skydio’s vulnerabilities came into sharp focus days before the U.S. presidential election, when Chinese authorities imposed sanctions and severed the company’s access to essential battery supplies.

Overnight, the San Mateo, Calif.-based Skydio, the largest American maker of drones, scrambled to find new suppliers. The move slowed Skydio’s deliveries to its customers, which include the U.S. military.

“This is an attack on Skydio but it’s also an attack on you,” Adam Bry, the chief executive, told customers.

Behind the move was a message from China’s leaders to Donald J. Trump, who would go on to win the election with a promise of new China sanctions and tariffs: Hit us and we’ll strike back harder.

From the campaign trail to his cabinet appointments, Mr. Trump has made it clear that he believes a confrontation with China over trade and technology is inevitable. In the first Trump administration, the Chinese government took mostly symbolic and equivalent measures following U.S. tariffs and trade restrictions. This time, China is poised to escalate its responses, experts say, and could aim aggressive and targeted countermeasures at American companies.