Chinese electric vehicle maker BYD has been included in a United States list of companies believed to have links to China’s military, placing the fast-growing automaker under heightened scrutiny.
The Pentagon’s updated Section 1260H list also named major Chinese firms including Alibaba, Baidu and NIO, with a total of 188 companies identified as having alleged ties to China’s military.
While the designation does not impose immediate sanctions, it could restrict future procurement by the US Department of Defense, according to Reuters.
The move reflects growing tensions between Washington and Beijing, particularly in strategic sectors such as electric vehicles, artificial intelligence and advanced manufacturing.
US authorities claim that BYD, although operating as a civilian automaker, contributes to China’s defence-industrial ecosystem.
However, BYD has rejected the designation, stating that it is not a military-linked entity and insisting that the US decision does not reflect reality. The company said it would pursue all available legal and administrative channels to defend its position.
The listing is widely viewed as a warning to American companies and institutions regarding engagement with the named firms.
In Malaysia, BYD entered the market through Sime Darby Motors, which became its official distributor in December 2022.
Separately, the Ministry of Investment, Trade and Industry previously said BYD Automotive Malaysia was granted an interim manufacturing licence for operations in Tanjung Malim.
However, Minister Datuk Seri Johari Ghani noted that BYD has yet to agree to certain conditions, including export requirements for locally assembled vehicles and pricing guidelines for domestic sales.
The ministry also confirmed that exemptions for fully imported electric vehicles ended on December 31, 2025, with new policy conditions set to take effect from July 1.
