While political tensions with China have made headlines for years, the drone industry is feeling the impact in real time. After all, the last couple months have been a wild ride when it comes to tariffs. And even American drone companies, like AgEagle, are bracing.
On April 5, Trump imposed a 10% tariff on all countries, citing his authority under the International Emergency Economic Powers Act of 1977 (IEEPA), which is there to address national emergencies. He has cited the nation’s trade deficit to enact that.
Then on April 9, Trump imposed individualized, reciprocal higher tariff on the countries with which the United States has the largest trade deficits. Tit-for-tat retaliation sent tariffs on products made in China (which accounts for not just drones made my companies like DJI, but also components used by drone companies) beyond a staggering 145%.
Amidst turmoil in the stock markets, his tune as changed. At a White House event on April 22, Trump said that high tariffs on Chinese goods would come down.
“145% is very high and it won’t be that high,” Trump said. “It won’t be anywhere near that high. It’ll come down substantially. But it won’t be zero.”
So what do American drone companies think of U.S. tariffs?
AgEagle weighs in on the drone economy
I sat down with Bill Irby, CEO of AgEagle Aerial Systems Inc. (Nasdaq: UAVS). His take in a nutshell? Tariffs on Chinese drones may sting in the short term, but they’re part of a long-term opportunity for American drone companies.
“I’m a huge fan of getting China out of the U.S. — getting them out of the U.S. skies for all the reasons that the administration has put forward,” Irby said. “I know what they’ve done, and I know what they’re capable of. I think it’s very good to get all Chinese drone manufacturers out of the U.S. airspace.”
His company, AgEagle, is based in Wichita, Kansas. It builds hardware, high-precision sensors and ground control and analytics software for drones.
Their key products include the eBee X, which is designed for mapping, the eBee TAC Public Safety an the eBee Vision, which is designed for real-time situational awareness. All of those drones are fairly light, weighing about 3.5 pounds, and are capable of flying for up to 90 minutes at a time.
The state of Chinese drone bans
The Trump and Biden administrations alike have raised concerns about data privacy and national security risks tied to Chinese-made drones — particularly DJI, which dominates the consumer and commercial market globally.
Recent federal legislation restricts certain U.S. government arms and its contractors from using Chinese drones. That includes a 2020 policy shift where the the U.S. Department of the Interior (DOI) restricted the use of drones that could be purchased for use within the agency, blocking those that were manufactured in adversary nations including China.
Related read: Foreign-made drone ban leaves one major U.S. federal agency scrambling over high costs
Even before Trump was elected president, politicians called for ways to limit or ban DJI drones, including through tariffs. For example, New York’s Republican Congresswoman Elise Stefanik in May 2024 introduced the Drones for First Responders (DFR) Act. That would have created a 30% tariff on drones made in China, with subsequent increases over the years until they are banned entirely. Another proposal, the American Security Drone Act of 2023 sought to prohibit all federal agencies from purchasing drones made by certain foreign entities, like those made in China.
How American companies are handling the global manufacturing dilemma
Few American companies truly make all of their products in the U.S. Most procure at least some parts from other companies. Tariffs not only add to costs, but also complication.
“Manufacturers must track millions of components as they move along the supply chain, and properly classify each product by country-of-origin and Harmonized Tariff Schedule (HTS) codes–or codes used to identify products for duty rates–to calculate tariffs,” according to a statement from Cofactr, a source-to-pay and logistics platform. “Companies must also hold a documentation trail for each of their products as they cross international borders so they can properly prepare records for duty drawbacks, temporary import bonding, and de minimis exemptions.
Cofactr has suggested that companies who do this manually are subject to increased errors, which could result in production delays, goods held in customs, and unexpected costs.
For AgEagle, which designs and manufactures drones in Switzerland, global borders have created their own set of barriers.
“Switzerland’s neutrality has prevented us from selling to places like Ukraine and Israel,” Irby said. “So we’re taking steps to bring a production line into the U.S.”
This reshoring effort isn’t just about geopolitics; it’s about access. Building drones domestically would eliminate international restrictions and align with increasing government preference for “Made in America” tech.
The tariff trade-off
Tariffs on imported drone parts present both challenge and opportunity for American drone companies.
“We’re still going to get hit with tariffs on some international parts,” Irby said. “But the move to manufacture in the U.S. means we could see increased demand from customers who want to buy American.”
In short: tariffs could increase AgEagle’s cost of doing business, but they also boost its competitiveness in a market that’s increasingly wary of Chinese tech.
Will prices rise for consumers?
In short, anyone buying a drone should expect prices to rise as a result of tariffs. DJI already explicitly warned that price increases are coming to its drones. Irby said that AgEagle customers should expect the same.
“If we see a price increase, [our customers] will see a price increase,” Irby said. “That’s just how it works.”
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