Pentagon Report Flags Alibaba, Baidu, and BYD for Possible Military Links

The Pentagon has reportedly determined that Alibaba Group Holding, Baidu Inc., and BYD Co. should be added to the U.S. Section 1260H list, a roster of Chinese companies believed to support China’s military activities. According to Bloomberg News, Deputy Defense Secretary Stephen Feinberg notified lawmakers of the assessment in an October 7 letter, sent just weeks before U.S. President Donald Trump and China’s President Xi Jinping reached a temporary trade truce.

The Section 1260H list, updated annually under U.S. law, identifies Chinese firms with alleged ties to the People’s Liberation Army. While inclusion does not trigger immediate sanctions or business bans, it can significantly damage a company’s reputation and serves as a cautionary signal for U.S. businesses evaluating potential partnerships. The most recent update in January included 134 Chinese companies, among them Tencent Holdings and leading battery manufacturer CATL.

In addition to Alibaba, Baidu, and BYD, Feinberg recommended five other companies for inclusion: Eoptolink Technology, Hua Hong Semiconductor, RoboSense Technology, WuXi AppTec, and Zhongji Innolight. The Pentagon, Baidu, and BYD have not yet issued public comments regarding the reported findings.

Alibaba, however, responded through a statement to Reuters, disputing any justification for placing the company on the list. The spokesperson stressed that Alibaba is neither a Chinese military enterprise nor part of China’s military-civil fusion strategy. The company also emphasized that even if it were added to the Section 1260H list, its business operations in the United States and globally would remain unaffected, as it does not participate in U.S. military procurement.

With geopolitical tensions between Washington and Beijing remaining high, scrutiny of Chinese technology and semiconductor firms continues to intensify. The potential expansion of the Section 1260H list underscores ongoing U.S. concerns about national security risks tied to China’s corporate landscape.