Two representatives of the US House of Representatives have sent a letter to the Secretary of the Commerce Department, Gina Raimondo, in which they ask that the drone manufacturer DJI remain on the list of entities of the Department of Commerce.
The full text of the letter is linked above. Jan Schakowsky, Chairman of the Consumer Protection and Trade Subcommittee, House Energy and Trade Committee; and Gus M. Bilirakis, Ranking Member of the Consumer Protection and Commerce Subcommittee on the House Energy and Commerce Committee wrote the letter urging US Secretary of Commerce Gina Raimondo to keep DJI on the department’s list of companies and attribute the company’s pricing tactics investigate:
DJI deserves additional examination from the Department of Commerce for its history of complicity with human rights abuses and its marketing tactics. We ask that DJI remain on the Department’s entity list and that the Department investigate its prices for consumer drones that have harmed American consumers.
At the time the Ministry put DJI on the Ministry of Commerce’s list of entities – along with 76 other companies – DJI and other Chinese companies were accused of involvement in human rights abuses because it appeared that DJI drones were being used by Chinese government agencies for surveillance were used.
The current letter claims that DJI’s low prices are an unfair market tactic.
… DJI was able to achieve its monopoly through extremely low prices. DJI reportedly cut consumer drone prices by up to 70% in 2015. Since then, three of its biggest competitors have ceased manufacturing consumer drones. The result was a dramatic loss of domestic manufacturing capacity, according to a Defense Department official.
These tactics have hurt consumer choice and have made DJI the default provider of consumer drones in the United States. We respectfully request the Department of Commerce to investigate DJI’s pricing of its consumer drone products and its successful efforts to drive competitors out of the market.
DJI denies the price gouging allegations and a US federal court ruled that DJI’s 2019 US sales practices were fair in antitrust proceedings. In a blog post that clears up some common misconceptions about the company, DJI says:
DJI leads the drone industry because We deliver what customers want – the most innovative technology at competitive prices. We were the first to develop many popular features, our design and manufacturing expertise enables us to quickly retool and introduce new products, and we have mastered the technical challenges of drone development and production better than our competitors.
Long-time market watchers know that DJI never sold the cheapest drones, instead offered premium products at reasonable prices. A US federal court dismissed allegations of unfair pricing last year and ruled that DJI’s American sales practices are “fully in line with tough competition in a growing market”.
What does DJI’s inclusion in the Department of Commerce’s entity list mean?
Inclusion on the list of companies does not affect DJI’s ability to sell drones in the US and does not constitute a ban on the purchase of DJI drones. The Entity List is part of the US Export Control Protocol and could make it difficult for US companies to Export parts to DJI.
Miriam McNabb is the Editor-in-Chief of DRONELIFE and CEO of JobForDrones, a professional marketplace for drone services, and a passionate observer of the emerging drone industry and regulatory environment for drones. Author of over 3,000 articles focusing on the commercial drone space, Miriam is an international speaker and recognized figure in the industry. Miriam graduated from the University of Chicago and has over 20 years experience in high-tech sales and marketing for emerging technologies.
For advice or writing in the drone industry, email Miriam.
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