Washington Democratic senators have urged the US Department of Defense to conduct an immediate review of SpaceX following allegations that Chinese investors may have secretly acquired stakes in the closely held aerospace company, warning of possible national security risks.
According to a letter reported by Reuters, Senators Elizabeth Warren and Andy Kim wrote to Defense Secretary Pete Hegseth raising concerns that indirect Chinese investment in SpaceX could expose sensitive military and intelligence-linked infrastructure to foreign influence. The lawmakers asked the Pentagon to urgently examine the matter and clarify the extent of any such ownership.
SpaceX, founded by Elon Musk, is a key private-sector partner for US government space and defence operations.
Allegations of indirect Chinese investment
The senators cited media reports and court testimony that suggested investors with ties to China may have routed money through offshore financial entities to acquire SpaceX shares. These routes reportedly include jurisdictions such as the Cayman Islands and the British Virgin Islands, which are often used in global investment structuring.
According to the letter, such layered investment channels may have been used to mask the true origin of funds and the identity of beneficial investors.
The lawmakers cautioned that if verified, such arrangements could raise serious compliance and security questions given SpaceX’s deep involvement in sensitive government missions and communications systems.
Role of SpaceX in US defence and intelligence
SpaceX plays a significant role in US national security infrastructure. The company launches military and intelligence satellites and provides launch services for classified payloads. Its Starlink satellite communications network is also used by the Pentagon and has supported defence communications in conflict zones, including Ukraine.
Because of this close operational linkage with defence and intelligence agencies, the senators argued that ownership transparency is critical.
They wrote that Chinese-linked ownership — even if indirect — could represent “a national security threat, potentially jeopardising key military, intelligence, and civilian infrastructure.”
FOCI rules may be triggered
The letter points to US regulations covering Foreign Ownership, Control or Influence (FOCI), which are designed to protect sensitive companies working with classified or defence-related information.
Under FOCI rules, companies with certain levels of foreign ownership or influence may be required to implement mitigation measures. These can include governance restrictions, security controls, or special oversight arrangements to ensure that foreign stakeholders cannot access sensitive technology or data.
The senators asked the Defense Department to determine:
- Whether SpaceX currently has any Chinese-linked ownership
- Whether it is subject to FOCI mitigation requirements
- Whether such investments should be reviewed by the Committee on Foreign Investment in the United States (CFIUS)
They requested a formal response from the Pentagon by February 20.
Reference to Musk’s expanding tech ecosystem
The lawmakers also flagged SpaceX’s reported acquisition of xAI, another Elon Musk-linked company focused on artificial intelligence, as a factor increasing the urgency of scrutiny. They argued that growing vertical integration across AI, satellite internet, rocket launch systems and communications platforms heightens the strategic sensitivity of ownership questions.
Musk has described xAI as a highly ambitious integrated technology platform spanning AI, rockets, space-based internet and real-time information systems.
The senators suggested that as these ecosystems become more interconnected, the potential impact of undisclosed foreign stakes becomes more significant.
No immediate public response from Pentagon or SpaceX
As of the report, neither the Department of Defense nor SpaceX had issued a detailed public response to the senators’ letter. It is also not yet clear whether the Pentagon has already initiated any internal review tied to the allegations.
Such letters from lawmakers do not automatically trigger enforcement action but often prompt formal assessments or inter-agency consultations, particularly where defence contractors or strategic technology providers are involved.
Conclusion
The senators’ request adds to ongoing scrutiny in the US over foreign investment in strategic technology and defence-linked firms. With SpaceX deeply embedded in national security, satellite communications and launch infrastructure, questions around ownership transparency and foreign influence are likely to receive close regulatory attention if the allegations gain further evidentiary backing.