Sanctions on Skydio Expose America’s Dependence on Chinese Supply Chains

America's reliance on Chinese supply chains was starkly revealed when drone manufacturer Skydio informed customers of a battery shortage resulting from recent Chinese sanctions. In a letter shared with customers, CEO Adam Bry emphasized the sanctions as an attempt to cripple America’s leading drone manufacturer, Skydio, and increase global dependence on Chinese suppliers.

Skydio, which supplies drones for Ukraine's military and Taiwan’s National Fire Agency, relies on China for battery components, a key part of its U.S.-assembled drones. The sanctions, imposed in early October, bar Chinese firms from trading with Skydio, forcing it to ration customers to one battery per drone until spring 2024 when alternative suppliers are expected to come online. To support affected customers, Skydio is extending warranties and software licenses.

In response, Skydio has sought assistance from the Biden administration and connected with Taiwanese Vice President Hsiao Bi-khim as it faces sanctions targeting the U.S. military aid commitment to Taiwan. The sanctions also affected Skydio executives, including Bry and Asia-Pacific general manager Tom Moss.

Skydio’s challenge exemplifies broader U.S.-China tensions over drone technology, highlighted by DJI, the world’s largest drone maker, recently suing the U.S. government over its designation as a “Chinese military company.”