China’s Skydio curbs sound the alarm for US battery supply chain

Skydio, the largest drone manufacturer In the United States, has failed to obtain the batteries made by Japanese TDK’s unit in mainland China after it was sanctioned by the Chinese government three weeks ago.

The California-based company last week sought help from the Biden administration as its Chief Executive Adam Bry met with US Deputy Secretary of State Kurt Campbell and senior officials at the White House, the Financial Times reported.

The Chinese government last month announced its sanctions against Skydio, Huntington Ingalls Industries and Edge Autonomy Operations LLC, as well as 10 senior executives of American defense contractors, and accused them of providing substantial military assistance to Taiwan. Observers couldn’t help noticing that the date of the announcement, October 10, marked the 113th anniversary of the Republic of China.

After the announcement, Chinese officials visited Skydio’s suppliers, including Dongguan Poweramp, a subsidiary of Japan’s TDK, and ordered them to cut ties with the American drone maker, a person familiar with the situation told the Financial Times on Thursday.

“This is a clarifying moment for the drone industry,” Bry told Skydio’s customers in a note obtained by the Financial Times. “If there was ever any doubt, this action makes clear that the Chinese government will use supply chains as a weapon to advance their interests over ours.”

He said Beijing wants to eliminate the leading American drone company and deepen the world’s dependence on Chinese drone suppliers.

Bry told US media that Skydio has a substantial stock of batteries on hand but it does not expect new sources of battery supply until next spring, He said the company has invested in domestic production and sourcing