China-Based Hesai Appeals US Court Ruling Designating Military Links

Hesai Group, a China-based lidar manufacturer specializing in civilian and commercial applications, is appealing a U.S. District Court ruling that upheld the Department of Defense's designation of the company under the National Defense Authorization Act due to alleged ties to China's military. The court acknowledged no direct evidence of Hesai’s products being used for military purposes but based its decision on the company’s geographic R&D location and the theoretical military potential of lidar technology. Hesai disputes the ruling, emphasizing that it has never developed or supplied products for military use and argues that the court's rationale could unjustly apply to many companies in China and abroad. The company filed a Notice of Appeal with the U.S. Court of Appeals for the District of Columbia to seek reversal and protect its reputation. Despite these legal challenges, Hesai continues to report strong revenue and shipment growth, focusing on expanding its lidar solutions for autonomous vehicles and robotics. Analysts provide a mixed outlook, recognizing Hesai’s growth but noting ongoing profitability challenges.