From Overcapacity to Overmatch: China’s Civilian Factories as Tools of War

China’s manufacturing strength is increasingly revealing itself not just as an economic asset, but as a cornerstone of national defense. In mid-2025, Russian state media claimed that China could produce 500,000 FPV (first-person view) drones per month and surge to 700,000 in wartime. Though initially met with skepticism, this figure aligns with China’s vast commercial drone production capacity and serves as a warning of its ability to mobilize for war.

FPV drones—cheap, fast, and expendable—have become a defining feature of modern conflict. Used heavily in Ukraine and Russia, these drones are often destroyed after a single mission. In such scenarios, replacement speed becomes a battlefield advantage, and China’s vast production base gives it the upper hand. Its dominance in the civilian drone sector (over 65% of global exports) and its control over key components (motors, cameras, flight-control systems) allow it to scale military applications with minimal reconfiguration.

The Communist doctrine of party control over the means of production enables China’s civil-military fusion strategy—a policy that integrates commercial industries directly into the nation’s defense planning at the discretion of the CCP. Civilian firms are expected to support military objectives when called upon. Many Chinese factories—particularly in electronics hubs like Shenzhen—can reportedly shift from consumer goods to defense products within days. Drone manufacturing, for example, can move from design to production in as little as 72 hours, thanks to dense supply chains, modular production lines, and flexible labor practices.

China’s wartime conversion capability was demonstrated during the COVID-19 pandemic, when face mask production jumped from 8 million to over 1 billion per day within weeks. That same infrastructure—idle capacity, surplus labor, and stored equipment—can be harnessed for war. What may seem like “inefficient” overcapacity is in fact a form of latent military readiness, unmatched in scale or speed by most industrialized nations.

At the component level, China controls critical nodes in the global supply chain. It dominates rare-earth magnet production for motors, manufactures vast quantities of optical systems, and continues to produce much of the world’s mid-tier microelectronics. Even if Western components are technically superior, China’s production volume, cost-efficiency, and self-reliance are decisive advantages in sustained conflict.

For Western policymakers, the war in Ukraine has exposed a paradigm shift. The traditional model of defense superiority—based on a technological edge—may be overtaken by industrial scale and speed. The Ukraine war demonstrates that war-winning potential now depends on who can field, replace, and re-field effective systems faster and cheaper. In this environment, China’s civilian goods become dual-use assets, and industrial policy becomes national security policy.

In this context, Western strategies like de-risking, reshoring, and supply chain restructuring must shift from slow-moving policy objectives to urgent national security priorities. Decoupling from Chinese manufacturing is no longer merely about protecting domestic industries—it is about denying a strategic adversary the industrial capacity it could weaponize in war. The real test is whether the West can move fast enough to blunt a rival already operating at the scale of a war-ready economy.