tariffs on chinese drones DFR Act

House Republicans propose tariffs on Chinese drones in name of first responders

First responders certainly use drones — and some U.S. Republicans want to make it so they’re not using Chinese-made drones. New York Republican Congresswoman Elise Stefanik in May 2024 introduced the Drones for First Responders (DFR) Act. But, the DFR Act doesn’t have as much to do with first responders as it has to do with raising taxes on Chinese-made drones, like those made by DJI.

The meat of the DFR Act entails implementing a new, 30% tariff on drones made in China. On top of that initial 30% tariff, the Act would also hike tariffs by 5% annually. In addition, the DFR Act would ban the importation of drones that contain what it deems certain, critical components that are made in China by 2030.

What does this all have to do with public safety? Tariff revenue would be then used for a grant program designed to help first responders. The text also suggests it could grant funding to other critical drone users such as farmers and infrastructure inspectors. Those grants would purchase drones that are specifically not made in China.

It’s all a move to promote American-made drone companies, while trying to prevent dominance of Chinese-made companies. Stefanik said the motivations were two-fold. The first centers around increasing the competitiveness of U.S. drone manufacturers. 

It also promotes political desires to eliminate use of Chinese drones. Politicians have suggested that such a move would enhance U.S. national security. That’s because fewer drone means less data gathered on Chinese-made drones, which some say is accessible by the Chinese government.

For its part, DJI says it does not automatically share its data with the Chinese government. “Your data is stored safely on your drone and in the DJI mobile app you use to control it, and you decide whether to share it with anyone,” according to a 2020 statement from DJI, which it put out in tandem with a guide on enabling its data privacy and security methods.

Rep. Elise Stefanik (R-NY) joins former President Trump during a campaign rally in New Hampshire. (Photo by Chip Somodevilla/Getty Images)

U.S. government steps in to combat DJI’s monopoly 

An estimated 90% of drones operated by U.S. first responders in 2024 are made in China, according to Stefanik. DJI makes most of those, though other Chinese-made drones used by first responders include the Autel EVO II Dual. DJI’s rise to dominance has largely been attributed to heavy subsidies from the Chinese government. Some speculate DJI has benefited from direct government investment. On top of that, favorable regulations allowed DJI to undercut U.S. drone manufacturers.

Stefanik calls these things “unfair trade practices.”

And sure, many attribute the failure of American drone companies like 3D Robotics and GoPro to the fact that they just could not compete on price. Then again, many drone experts also largely agree that the products build by those companies suffered from significant technical issues. They say it’s the tech failures that resulted in weak sales — not the price point.

What happens if we impose tariffs on Chinese drones?

Stefanik’s priority with the bill? It’s a response to circumstances that “have allowed CCP-controlled drone companies to monopolize the U.S. drone market,” according to a statement about the DFR Act.

Could eliminate security threats

There is some concern that DJI drones are a threat to national security. A tariff that at least makes DJI drones more expensive could certainly do something to cut back on buyers’ decisions to purchase DJI drones over another brand. For example, the Department of Defense (DoD) has said it believes that DJI is actively advancing the military capabilities of the Chinese government. Both a 2017 Homeland Security Intelligence Bulletin and a 2024 CISA industry alert have claimed that Chinese drones present significant risks to U.S. critical infrastructure and national security. Additionally, the DoD prohibits the U.S. military from operating PRC-drones. 

“Chinese drones pose an unacceptable surveillance risk,” said John Moolenaar (R-MI), who co-sponsored Rep. Stefanik’s legislation.

A firefighter flies a DJI M30 drone. (Photo courtesy of DJI)

Would increase costs for businesses that rely on DJI drones

Tariffs wouldn’t necessarily make American-made drones cheaper — but they would make DJI drones more expensive. A wedding photography business would definitely see costs increase the next time they buy a new DJI camera drone. But, they wouldn’t necessarily have equally-affordable alternatives. That’s largely because there are very few alternatives to DJI in the category of drones under $1,000.

Drone Advocacy Alliance, a group of drone industry players which includes DJI itself, has painted an incredibly bleak picture of the potential outcome of such legislation.

“The results of this legislation would be dire, including the loss of hundreds of thousands of American jobs with small businesses feeling the brunt of higher costs, a potential collapse of the consumer drone market and a reduction in the use of drones in life-saving operations,” according to a statement from the Drone Advocacy Alliance.

Would create a grant program with an inconsistent revenue stream 

Some critics of tariffs argue that programs structured like the Drones for First Responders Act create unpredictable, inconsistent revenue streams. Taking money from the sales of DJI drones means that funding for the grant program only comes in when DJI drones actually sell. Increasing consumer costs of DJI drones only makes it so consumers are less likely to buy them. Sure, that might accomplish a politician’s goal to take down DJI. But, it doesn’t accomplish the stated goal of funding the purchase of American drones by U.S. first response teams.

As a tariff alternative, some experts have argued that — to accomplish the goal of getting funding for American drone companies — the government should essentially follow the lead of the Chinese government. That’s directly investing in American drone companies (or creating grand programs) out of a more general budget — not one tied to DJI drone sales.

Could help fund American drone companies

For grant programs that rely on tariffs, some money is better than no money. So even with the inconsistent revenue stream that tariffs bring in, the money could do something to help provide the financial backing to American drone companies. That could at least do something to make up for the roughly decade that DJI has had in collecting money from its own home government to grow its business.

“A strong U.S. drone manufacturing industrial base represents a strategic imperative for the U.S,” said Michael Robbins, President and CEO of the Association for Uncrewed Vehicle Systems International (AUVSI). “We can, and must, do more to bolster drone security for end users while supporting U.S. values, aviation leadership, and investments in manufacturing jobs.

That said, some involved with the bill have suggested it could go further in establishing a more consistent base specifically to account for that issue. For example, Michael Stumo CEO of the Coalition for A Prosperous America, suggested that perhaps phasing-in tariffs tied with subsidies would help to incubate new manufacturing industries.

Would increase costs for Americans outside the drone industry

Proponents of tariffs argue that costs only increase on buyers of those products, which is in some part true. A 30% price increase on drones has little direct effect on someone who has never bought a drone.

“Grant programs are a common-sense mechanism for getting secure, capable drones into the hands of public safety, critical infrastructure, and agriculture applications, and with the DFR Act’s revenue raising measure, the grants are at no additional cost to the taxpayer,” Robbins said.

But as drones become increasingly commonplace in everything from drone deliveries to real estate photos, the effects could actually be more far-reaching than intended. For example, photographers might charge more for their services to pass off the higher costs to buy DJI drones. That means couples getting married might pay even more for their weddings if an aerial photo is involved. Likewise, delivery fees for your next drone-delivered meal would likely go up, as would the cost of buying a home (assuming the listing involved an aerial photo).

Even taxpayers could see higher costs. For example, wildlife management teams have used drones to search for or count animals in a given area. Such a fairly simple use case doesn’t necessitate a high-end drone. A simple camera drone execute such a task. If, say, Yellowstone National Park had to pay 30% more for a drone to count bison, they might need a bigger budget. That just means more taxpayer money.

Would reduce sales of DJI drones in the U.S.

DJI Mini 4K
The DJI Mini 4K. (Image courtesy of DJI)

It’s almost certain that higher price tags on drones would reduce their sales. DJI has introduced incredibly low-cost camera drones like the DJI Mini 4K. Such drones have proven affordable enough to land a spot on countless Christmas gift guides and birthday wish lists.

But perhaps that’s exactly the goal of American politicians, who have been on a streak lately of banning Chinese-associated products. That includes recent efforts to ban TikTok.

“We simply cannot cede control of the drone market to the Chinese Communist Party,” said Congressman Rob Wittman (R-VA).

What’s next for the DFR Act?

Expect a lot of movement on the DFR Act to come. That includes more broad government discussion on topics about Chinese-made drones and drones for public safety in the coming months.

AUVSI, which is the world’s largest non-profit organization to promote drones and robotics, will host its annual Hill Day in June 2024. There, expect key discussions around the value of drones in public safety near or at the forefront. Additionally, members of AUVSI’s Air, Maritime, Ground, and Cyber Advocacy Committees are set to meet with lawmakers. They’ll discuss policies that will allow the deployment of uncrewed systems to better serve American communities, including for applications in public safety and emergency response as part of Hill Day.

Consider the intersection of the DFR Act with other proposed anti-drone legislation

The DFR Act is hardly the only piece of legislation that seeks to impede sales of DJI drones.

Among those include the American Security Drone Act of 2023. If passed, it would prohibit federal agencies from purchasing drones made by certain foreign entities, like those made in China.

And then there’s the  Countering CCP Drones Act. That act would place DJI on a Federal Communications Commission (FCC) blacklist. In turn, that effectively blocks new DJI drones from flying in the U.S. (though existing DJI drones would still be okay). Perhaps not coincidentally, Representative Elise Stefanik, who introduced the DFR Act, is also the same politician who introduced the far more controversial Countering CCP Drones Act.

Neither of those two proposed laws have yet to have passed. Though, many say it’s unlikely such a law would pass given how extreme an entire DJI ban could be perceived. In fact, some industry experts consider the DFR Act a more moderate version of other proposed policies, such as those named above.

For example, Matt Sloane, CEO and founder of Skyfire Consulting, shared strong support for the DFR Act in an op-ed for drone news site DRONELIFE. Much of it stems from his belief that this is a more moderate version of what might otherwise be an outright ban.

“It accounts for the fact that a further limitation on PRC drones is likely coming, and seeks a middle-ground approach towards disincentivizing people from buying them, while at the same time incentivizing them to buy alternative drones — BUT — it doesn’t call for a ban,” he wrote in the DRONELIFE post.

If you want to publicly oppose the DFR Act

If you’re opposed to the DFR Act, the Drone Advocacy Act built a form for you to voice your opinions. They’ve created a webpage that sends a pre-written message to your local Representative asking them to push back on the DFR Act.

And for what it’s worth, if you’re considering expanding your fleet, now might be the best time to buy a DJI drone — before those tariffs kick in and increase prices.

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One Comment

  • Dennis Evers says:

    It’s a shame you have decided to make the DJI ban a political thing. Yes un uninformed dipstick Stefanik is being persuaded to promote this ban, but that said she is one republican. Then you choose to put her photo with Trump as to give appearance Trump goes along with the ban proposal. NOT SO. In fact Trump may be a key person to STOP the ban.
    Sad to see you have chosen to go political bashing all because of Stefanik.

    Dennis Evers
    k9evers@gmail.com

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