US senators urge Pentagon review of SpaceX over alleged Chinese investments
Two US Democratic senators have urged the Department of Defense to review SpaceX following reports of hidden Chinese investments, warning that foreign influence in a key defence contractor could pose serious national security risks.
New Delhi: Two US Democratic senators, Elizabeth Warren (from Massachusetts) and Andy Kim (from New Jersey), have reportedly urged the Department of Defense (DOD) to conduct a review of billionaire Elon Musk-led SpaceX.
The senators alleged that Chinese investors have secretly acquired stakes in the aerospace maker, The Hill Reported.
In a letter to Defense Secretary Pete Hegseth, the legislators raised concerns about SpaceX, a major contractor for the DOD. They also cited recently unsealed court records and a ProPublica investigation from March.
“These ties could pose a national security threat, potentially jeopardising key military, intelligence, and civilian infrastructure, and are at odds with the administration’s policies on foreign investment from countries of concern in strategic industries,” the senators wrote.
A SpaceX investor, in testimony that was unsealed in October last year, shared that the company had been aware of potential Chinese investment since 2015.
As per the ProPublica report, SpaceX allows Chinese investors to buy stakes in the company through offshore accounts.
The investigation also covered SpaceX executives’ decision to cancel a $50 million investment in the company’s stock from a Chinese firm after news of the deal broke.
The senators said the extent to which the DOD depends on SpaceX provides even greater reason for concern. The company has billions of dollars in contracts with the department, including a $5.9 billion launch service contract, the report said.
“The mere proposition that an adversary nation such as China could have leverage and influence over a company such as SpaceX, one that underpins our national security apparatus, is an unacceptable risk,” the senators wrote.
Both Warren and Kim also expressed specific concerns that the Chinese investors might use their influence to gain information about nonpublic company information to “undermine US national security.”
In addition, the senators asked for Hegseth’s response by February 18 to several questions about Chinese influence at SpaceX. They also sought a response to DOD’s planned action to address potential security concerns related to these investments, the report said.
