China hit these 4 San Diego companies with economic sanctions – San Diego Union-Tribune
China is targeting U.S. defense companies, including four in San Diego, with economic sanctions in the escalating tariff dispute with President Donald Trump.
The retaliatory measures, announced Friday, follow Trump’s across-the-board 34% tariff on Chinese goods that takes effect April 10.
China reciprocated by announcing a 34% tariff on U.S. imports. On top of tariffs, the country is now restricting local firms from doing business with China, including San Diego’s Kratos Defense, Cubic Corp., Firestorm Labs and Source Intelligence.
The common thread among the American firms targeted with sanctions: They are involved in the aerospace and defense technology sectors.
China’s export control list, which prohibits these businesses from exporting Chinese products considered “dual-use” for military and civilian purposes, has been growing as trade tensions have increased.
China introduced its sanctions list at the end of 2024 and included U.S. defense giants Lockheed Martin and General Dynamics.
Among the firms added this week were Cubic Corp., headquartered in Kearny Mesa, which develops technology solutions for defense and transportation applications. Additionally, La Jolla-based Source Intelligence, which makes software to help companies manage their supply chain and does work with the military and aerospace sector, was added to the list.
Separately, China also announced 11 companies that were added to its Unreliable Entities List. This blacklist blocks companies from engaging in imports and exports related to China and prohibits the firms from making new investments in China, according to the Chinese government’s news release.
China says this list is meant to safeguard its national sovereignty, security and development interests. In February, Illumina made headlines as one of just a few U.S. firms placed on China’s Unreliable Entities List.
On Friday, San Diego-based defense companies Kratos Unmanned Aerial Systems, a division of Kratos defense and security solutions, and Firestorm Labs were among these companies added to this list.
A Kratos spokesperson said “there is absolutely zero impact” to the publicly traded company’s business following China’s announcement.
“Kratos’s mission is to support U.S. national security and our allies, and as such, we do no business with China,” the company said in an email.
Cubic, Firestorm Labs and Source Intelligence did not respond to the Union-Tribune’s request for comment on Friday.
It is not completely unexpected that China decided to sanction some of these defense technology firms.
In December, the Chinese government announced a “list of targets of countermeasures,” which included San Diego-based Shield AI, which makes autonomous aircraft technology, Firestorm Labs, Kratos and 10 other U.S. companies. This action threatened to freeze these businesses’ assets within China and prohibit Chinese entities from dealing with them.
At the time, China said these countermeasures were a result of the United States announcing “another arms sale” to Taiwan. China claimed this undermined its internal affairs and national sovereignty because it considers Taiwan, a self-governing region, as part of its country.
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