Sen. Banks Calls on Secretary Hegseth to Blacklist Chinese Engine Maker with Ties to PLA

Weichai engines are used in rocket systems supplied to the Chinese military

WASHINGTON, D.C. - Today, Senator Jim Banks (R-Ind.) sent a letter to Secretary of War Pete Hegseth urging the Department of War to add Weichai Holding Group Co. Ltd. to its Chinese Military Companies list.

Weichai is wholly-owned by a Chinese state-controlled enterprise and works with blacklisted Chinese defense companies. China North Industries Corporation (NORINCO)-a Chinese state-owned defense manufacturer-uses Weichai engines in a multiple-launch rocket system supplied to the People's Liberation Army, and Weichai has also partnered with a subsidiary of the blacklisted China Aerospace Science and Industry Corporation.

In the letter, Banks argues that Weichai's ownership structure, defense partnerships and role in China's military-civil fusion strategy meet the criteria for designation as a Chinese military company. He urges the Department of War to add Weichai to the 1260H List to protect U.S. national security and prevent Chinese military-linked companies from operating in the United States without appropriate scrutiny.

Read the full letter here.

Dear Secretary Hegseth:

I am writing to bring to your attention the U.S. national security risk posed by Weichai Holding Group Co. Ltd. (Weichai) and urge you to add it to the Department of War's Chinese Military Companies List (1260H List). Weichai, based in the People's Republic of China (PRC), manufactures diesel engines that are sold in more than 150 countries including the United States.

As you know, Section 1260H of the National Defense Authorization Act for Fiscal Year 2021 requires the Secretary of War to publish a list of "Chinese military companies." Under the statute, a Chinese military company includes entities identified as a military-civil fusion contributor to China's defense industrial base. Among the statutory criteria, an entity qualifies as a military-civil fusion contributor if it is affiliated with China's Ministry of Industry and Information Technology (MIIT) or the State-Owned Assets Supervision and Administration Commission of the State Council (SASAC). Weichai's ownership structure, state backing, and partnerships with entities of concern appear to satisfy these criteria.

Weichai is wholly owned by Shandong Heavy Industry Group, a state-owned enterprise supervised and controlled by the State-owned Assets Supervision and Administration Commission (SASAC) of the Shandong Provincial Government. This body maintains control over the company's strategic direction, and SASAC praised Weichai for "building a 'Benchmark' or High-Quality Development among State-Owned Enterprises." In 2019, Shandong Heavy Industry Group established a People's Armed Forces Department (PAFD) that reports to the Shandong Provincial Military District, and this group owns or holds controlling stakes in companies worldwide including the French diesel engine manufacturer Baudouin Motors. At a minimum, this ownership structure provides access to strategic resources and assets held by its overseas subsidiaries. Like all major state-owned enterprises (SOEs), Weichai also houses an active internal CCP committee that oversees major business decisions to ensure they align with the party's political directives.

Weichai's collaborations with PRC defense companies are equally concerning. NORINCO, a blacklisted Chinese military company that supplies the People's Liberation Army (PLA), procures Weichai engines for use in the PHL-11 Multiple Launch Rocket System (MLRS). Weichai also signed a cooperation agreement with Hubei Sanjiang Space Wanshan Special Vehicle Co., a subsidiary of the blacklisted China Aerospace Science and Industry Corporation (CASIC), further demonstrating its integration into China's defense industrial base.

Moreover, Weichai supports the State Key Laboratory of Engine and Powertrain System, one of the PRC's more than 500 State Key Laboratories (SKL). SKL's are part of a PRC government-directed research network that seeks to reduce its reliance on foreign technologies. PRC central government planning documents describe SKLs as "vital components of China's innovation ecosystem." SKLs receive central government funding to advance strategic technologies for both commercial and military use, making Weichai a key participant in China's military-civil fusion strategy.

In addition to its role in military-civil fusion, Weichai works directly with foreign defense entities of concern and firms that have been sanctioned by the U.S. government. In 2016, Weichai signed a cooperation agreement with Belarus' MAZ group - sanctioned by the Treasury department in 2023 - to build diesel engines. It also established a joint venture with Kamaz, a Russian supplier of trucks to the Russian Ministry of Defense, and signed a cooperation agreement with Hubei Sanjiang Space Wanshan Special Vehicle Co., a wholly owned subsidiary of the blacklisted China Aerospace Science and Industry Corporation (CASIC).

Equally alarming is Weichai's subsidiaries and members that maintain extensive ties to Chinese government industrial initiatives, state-funded research programs, and defense-linked institutions:

1. Shaanxi Heavy Duty Automobile Co., a Weichai subsidiary, participates in multiple national high-tech and Ministry of Science and Technology research programs.
2. Shaanxi Fast Gear Co., a Weichai subsidiary, explicitly identifies the Belt and Road Initiative and "Made in China" strategy as key drivers for its growth.
3. Shaanxi HanDe Axle Co., founded by Weichai, has received funding from the Baoji Municipal Bureau of Industry and Technology Provincial Fund for automotive industry development. It also has partnered with Xi'an Jiaotong University, a defense-linked institution supervised by the State Administration for Science, Technology and Industry for National Defense (SASTIND) that conducts classified military research and has strategic partnerships with major Chinese defense contractors. HanDe Axle has also received provincial science and technology awards, underscoring its integration into China's state-directed innovation ecosystem.

Collectively, these relationships between Weichai's members and the CCP demonstrate its connections to the CCP's industrial policy, government support, and collaboration with institutions that directly advance China's military-civil fusion strategy and defense industrial base. Weichai's work has even earned the praise of General Secretary Xi Jinping, who remarked in 2018 that "Weichai has handed in a brilliant result with ten years of development." The information above seems to indicate that Weichai meets the definition of a Chinese military

company and thus should be listed on the 1260H list.

Thank you for your attention to this critical national security matter. I am ready to work with the Department of War to ensure that our nation's industry remains secure from potential foreign threats.

Sincerely,

Jim Banks

U.S. Senator

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