Hesai expands U.S. lidar sales despite Pentagon blacklist

Hesai Technology has expanded its U.S. presence despite a 2024 Pentagon blacklist that designated the Shanghai-based lidar maker a Chinese military entity and national security threat.

Hesai supplies lidar for robots, self-driving vehicles and other physical AI systems. The sensors enable machines to perceive their surroundings in factories, on roads and in applications such as robotic dogs. Hesai has become one of the dominant suppliers in the global autonomous technology ecosystem, with its products integrated into vehicles and robots.

The Department of Defense placed Hesai on its blacklist in 2024. The designation bars the company from Pentagon contracts but does not prohibit U.S. firms from purchasing or integrating its lidar in nonmilitary uses.

Government officials and security researchers warn of cyber risks from Chinese lidar. Experts told CNBC that lidar units can be compromised with malware, potentially creating backdoors for Beijing to access sensitive data collected by the sensors. Such vulnerabilities could expose critical infrastructure built around autonomous systems.

Hesai has deepened its U.S. footprint through an expanded partnership with Nvidia. Under the deal, Hesai sensors become an integration option for automakers using Nvidia's autonomous vehicle platforms. Nvidia CEO Jensen Huang announced the partnership at CES in January 2026, stating the company's vision that every car and truck will eventually be autonomous.

Nvidia views robotics and self-driving technology as a major growth driver. In its latest annual filing, Nvidia reported automotive revenue for fiscal year 2026 rose 39 percent from the prior year, fueled by adoption of its self-driving platforms. Robotics ranks as the chipmaker's second-most important growth category after artificial intelligence.

Hesai's CEO rejects the national security allegations. In his first extended interview on the blacklist, co-founder and CEO David Li told CNBC the narrative that his company poses a threat is fiction. Li said the DOD case lacks sufficient evidence and is not logical, adding that the company does not work for the Chinese military and its products are safe.

The blacklist covers Hesai along with 187 other companies and subsidiaries. While it limits certain federal work, the company's commercial expansion continues in the rapidly growing autonomous vehicle and robotics markets.