Defense One - Business

New test range opens for the startup-war era

Patrick Tucker — Fri, 17 Apr 2026 06:00:00 -0400

A new, 400,000-acre testing and training facility aims to bring troops and defense firms together so they can innovate at the speed of modern warfare.

On Friday, Georgia-based Second Bend Labs announced the public opening of the facility near Moody Air Force Base. It’s designed to appeal to two usually separate groups whose challenges can only be solved together. Soldiers need to test drones and counter-drone equipment against a competent adversary, and drone startups need to see if their stuff works.

That requires a new approach to the military test range: a site that civilians can easily access, unlike a military base, and that allows military drone testing, unlike a regular expanse of private acreage.

Simply creating a place where a young company can fly medium-sized drones at the altitude of an A-10 Warthog and have soldiers shoot at it might seem obvious. It isn’t. It’s a problem that Deputy Defense Secretary Steve Feinberg discussed in his confirmation hearing as a major obstacle to modernization, and that Government Accountability Office and the Pentagon’s acquisition undersecretary have called burdensome to innovators. It’s also a problem that Ukraine has solved out of necessity, making the wartorn country a central testing site for drone and counter-drone warfare.

“You need to train the way you fight in realistic mission environments,” said Stu Booker, a former Air Force combat controller who is now Second Bend’s president of unmanned and autonomous systems. “Our clients, whether they are testing new technology, developing new tactics, or sharpening existing skills, are doing it in conditions that reflect the complexity of the environments they will actually fight in.”

The site offers diverse terrain and five miles of riverfront water for testing land and sea drones. It sits within Moody’s Corsair South Military Operations Area, which enables testing of low-altitude air support craft like the A-10 Warthog but also, increasingly, small and medium drones.

The facility has a range complex designed to Defense Department specifications, a 3,000-square-foot hangar, and an adjacent 20-foot launch pad. It also has “personnel in private guest home lodging, chef-supported meals, a 2,000-square-foot gym, and 3,000 square feet of team bonding spaces,” according to a press release for the lab. The idea is to create something akin to a modern co-working space or even a tech accelerator, allowing startups to collaborate and share gear. Think back to the Silicon Valley campuses of Google, Facebook (before Meta), and Twitter (before X) in the 2000s.

One thing the company is still working on is getting changes or waivers to local and federal regulations that limit its ability to replicate jamming and other electromagnetic warfare effects—the biggest factor driving evolution on the Ukrainian battlefield.

Second Bend Labs CEO Sam Kellett said he had reached operating agreements with the nearby Air Force base and the state of Florida. He also touted the willingness of federal officials to visit the site and discuss easing regulations—something the Defense Department has been pushing to increase the realism of testing and training.

“Our first government group will come out at the end of this month to start planning that. So there's nothing set in stone that we can or can't do. Okay, if somebody says they want to do something, we go find a way to make it happen for them,” said Kellett.

Why the need

One senior enlisted military official said other testing and training sites don’t make it easy for soldiers and engineers to do realistic drone-on-drone warfare, which changes far faster than Cold War-era testing sites or weapon designs under the constraints of programs of record.

The senior enlisted official said, “The rise of drones and counter-drone systems has forced us to dramatically expand the scope and frequency of training and testing. It’s no longer enough to strictly focus on shooting, moving, communicating.” Modern warfare has created a need for other skills such as analyzing electronic warfare conditions, identifying difficult-to-detect drone threats, and modifying equipment. “That means more repetitions, more scenario-based training, and more live or realistic test environments where drones are actually flying,” they said.

Practicing those skills requires more frequent contact with the people actually creating those technologies, people who aren’t easily found on military bases.

“My operators aren’t just users anymore, but they are also testers and evaluators. Every new piece of gear means building a mini test plan, running iterations, capturing data, and feeding that back to developers and higher headquarters,” they said.

The facility quietly hosted the 123rd Air Force Special Tactics Squadron in March and other military elements in previous months.

It has also hosted a handful of defense startups, younger companies that don’t have their own ranges and who aren’t accustomed to navigating the Defense Department’s complex procedures. These include Red Cat, a startup drone company; and a drone and counter-drone company called T3i.

Shaun Sorensen, T3i’s director of small unmanned aerial systems, said conventional test ranges are too “static.”

Today’s ranges lack “the ability to rapidly integrate and evaluate new systems—especially prototype solutions from startups,” Sorensen said in an email. “We need more interactive training and testing locations because drone and counter-drone threats evolve faster than traditional ranges and curricula can keep up.”

CEO Kellett also leads a biometric wearables company called Aware Custom Biometric Wearables. He said 2BL is blending the two to offer “next-gen human performance technology in development that will measure brain activity and vitals in realtime,” as well as other new tech that startups might want to test against gear from other startups.

Kellett said some of the early visitors to the site have also expressed interest in setting up production facilities nearby, in line with the growing Defense Department preference for a closer design, testing, and supply chain.

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Defense Business Brief: Robotic arms + satellite refueling | Iran war costs | Unmasking shadow fleets…from space

Lauren C. Williams — Wed, 15 Apr 2026 15:59:10 -0400

It seems everyone wants to rule the cosmos—or get a spaceplane. But the more satellites militaries launch and rely on, the more they need a good watchdog to protect them. And what’s better than one with a robotic arm that can also refuel?

That’s where the MDA Midnight platform, unveiled at Space Symposium in Colorado this week, comes in. The satellite—which boasts a robotic arm—can get in close to inspect other spacecraft, monitor surroundings, investigate approaching objects, and defend against incoming threats if needed, Holly Johnson, vice president of Canadian-based MDA Space’s robotics and space operations told Defense One.

Plus, it can refuel other satellites using its arm to keep a safe distance from a satellite that needs refueling while keeping it operational, she said.

The arm connects with a satellite’s refueling interface and “the robotics will compensate for the relative drift rates of those two platforms and refuel the satellite in a seamless manner,” Johnson said.

The company has worked with the Space Development Agency and is selected to join the Missile Defense Agency’s SHIELD program.

“More countries and more companies are going to space,” Johnson said, “and defense organizations around the world are increasingly relying on the imagery, the data, the information and the communications that satellites provide for their operation.”

There’s been a push for more information on what objects—including upwards of 10,000 satellites—are in space, what they’re doing, who they belong to, and any potential threats, “but the missing part of space domain awareness was being able to do anything about it,” Johnson said.

The product release comes after the head of U.S. Space Command expressed concerns about China’s recent satellite refueling experiments; more recently, he stressed the need to be able to move satellites around.

“My concern is if they develop that, they will have the ability to maneuver for advantage the way the United States has for decades—on the land, at sea, and in the air—used maneuver for our advantage,” Gen. Stephen Whiting told the Senate Armed Services Committee last month. “We need to deliver our own maneuver-warfare capability to make sure that we can leverage the advantages that the joint force has developed over the decades in space, as we have in other domains.”

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Costs of war. A protracted conflict with Iran could cost up to $20 billion per month, with surge capacity pushing it closer to $30 billion, Wayne Sanders, a senior aerospace and defense analyst with Bloomberg Intelligence, told Defense One.

Some costs are built into annual budgets, such as operation and maintenance of platforms, regardless of whether they’re in sustained operations.
For example, as the U.S. Navy blockades the Strait of Hormuz, “that continued operation and maintenance budget—there's a certain amount that already exists, whether [ships] are floating right outside in the Persian Gulf, or whether or not they're sitting near Norfolk. They're still going to have a $10 million-a-day carrier fee, if you will,” Sanders said.
“But the air wing…the amount of missiles that are being expended, the amount of jet fuel—obviously—begins to start playing a part in this, especially as you expand that time frame. So I think that's more into that $20-25 billion range per month for this period of time.”
Plus: There will likely be “very high” intelligence, surveillance and reconnaissance costs “because you're looking at 24/7 overflights” and air support.

Demystifying shadow fleets. The U.S.-Israel war on Iran has resurfaced concerns about GPS jamming and spoofing, which can make accurately tracking ships difficult. So spatial imagery company Vantor is melding its tech with Windward’s maritime analytics platform to put crisp, space-based visuals with an aggregate of vessel tracking data to better identify specific ships and their movements.

“It's not enough to use [low or medium resolution] satellites to look at ships, because it doesn't tell you anything. It just tells you, ‘hey, here's something that looks like a tanker,’” Windward CEO Ami Daniel told Defense One.
“You need to know who it is, what it has been doing, and what's going to do…And you have probably 10 minutes to make that decision because you might have five ships trying to go down the blockade, and you need to decide now. I think that's the core of a partnership with Vantor” and their visual library.
Peter Wilczynski, Vantor’s chief product officer, said the company’s imagery can track vessels over time, while Windward can add context.
“We have no idea what the actual order of battle, from a military context or perspective is, or the ownership structure, especially in the gray and dark fleet environment,” including vessels that deliberately turn off their AIS data to hide their location.
Vantor will integrate its persistent monitoring technology with Windward’s analytics to answer the question: “how do you take a picture of a ship and give it a fingerprint? And then that fits really naturally with the biographical history of the ship, who commands it, what its patterns are, what it tends to do—that gives you more of that predictive layer.”

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Airbus’ autonomous supply-helicopter effort may pave the way for an armed model

Thomas Novelly — Wed, 15 Apr 2026 13:19:19 -0400

An unmanned helicopter concept being developed by Airbus for Marine Corps logistics missions may pave the way for an armed variant, company officials say.

Airbus is working on an unmanned version of the MQ-72C Lakota for the Marines’ Aerial Logistics Connector competition; on Wednesday, the company said it had completed another autonomous flight test using its H145 helicopter and technology from Shield AI, L3Harris Technologies, and Parry Labs.

Company officials said it’s possible that the Lakota could be armed.

“Based on our discussions with other potential customers and partners, we believe there is an opportunity for mission expansion to include launched effects,” an Airbus official said. “Our primary focus remains providing the best aerial logistics platform for the Marine Corps. We believe the MQ-72C Lakota Connector can support a range of future missions thanks to its versatile design, [modular open system] architecture, and autonomous mission capabilities.”

Airbus is among several defense companies working on autonomous aircraft intended to replace military aviators on logistics missions. Last year, Sikorsky unveiled a pilotless UH-60L Black Hawk to carry cargo into combat zones. Similarly, Boeing announced a concept for a tiltrotor drone-wingman concept to support the Army’s helicopter fleet.

Airbus’ latest test flights, conducted in recent weeks at its Grand Prairie, Texas, facility, refined the helicopter's perception, officials said. The H145, the commercial variant of the Lakota, scanned a landing zone in flight, detected obstacles, and found an alternative spot to land if necessary. The technology detected objects “ranging from the size of a SUV down to a pelican case,” an Airbus official said.

“This test was vital for us to show the Lakota Connector’s development in performing aerial logistics missions for the U.S. Marine Corps,” said Rob Geckle, CEO of Airbus U.S. Space and Defense. “Perception systems can make or break the success of an unmanned mission in the field, and I am excited to see our aircraft perform so well under uncertain conditions.”

Part of the effort’s fourth series of tests, the flights were conducted in recent weeks at the Airbus facility in Grand Prairie, Texas. Shield AI contributed its Hivemind autonomy software, L3 Harris supplied modular and digital backbone, and Parry Lab provided edge-computing and ground-control stations for the tests, an official said.

“This H145 flight test proves Hivemind delivers scalable autonomy across rotary and fixed-wing aircraft without custom redesign,” said Christian Gutierrez, vice president of Hivemind Solutions at Shield AI. “That speed and flexibility are critical in contested logistics.”

An Airbus official said “the next step is progressively improving perception to detect smaller, more operationally representative objects” and additional internal autonomy and integration flight tests are expected throughout the year.

The Aerial Connector program is one of several Defense Department initiatives “aimed at delivering logistical support in distributed environments during peer or near- peer conflicts,” Airbus said in the news release. Other competitors in the program include

Those developments have made some aviators fearing for their careers, Defense One previously reported, especially as the push for autonomous choppers comes as some services shed helicopter units.

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US push to counter hackers draws industry deeper into offensive cyber debate

David DiMolfetta — Sat, 11 Apr 2026 12:22:00 -0400

The U.S. government has an offensive cyber wish list, and the private sector is already bidding. Many federal contractors back the effort, though they still have deeper questions about semantics and where offense ends and defense begins.

Terms like “disruption,” “cyber effects” and “defensive operations” were flung around in discussions at the RSAC Conference in San Francisco last month, one of the largest cybersecurity gatherings in the world. In discussions during and after the conference, Nextgov/FCW sought to learn how industry players perceive the vision under President Donald Trump to punch back harder against cyber adversaries, and how those industry leaders might contribute to the cause.

For the past year, industry executives and U.S. officials in closed-door meetings have weighed the concept of enlisting private sector cyber titans to hack for the government, inspired by the centuries-old practice of letters of marque and reprisal that made waves in the old days of naval warfare. But last month, National Cyber Director Sean Cairncross appeared to pour cold water on the concept.

He told audience members at an event that there’s “an enormous amount of capability on the private sector side,” but that he’s “not talking about private sector, industry or companies engaged in a cyber offensive campaign.”

Cairncross said he wants to use the “ability of our private sector … to inform and share information so that the [U.S. government] can respond” either defensively or in a more agile way to enemy hackers. His remarks came after the release of Trump’s national cyber strategy, whose first pillar focuses on ways to create obstacles for foreign state cyber operatives and criminal hackers.

But nearly a dozen interviews with industry stakeholders and former officials indicate that it remains an open question where companies draw the line on cyber offense and where the government does. The boundaries around offensive cyber are often blurred, and the private sector is still trying to learn its place. That uncertainty leaves more questions than answers about how offensive cyber operations should be structured, regulated and integrated into a broader U.S. national security strategy.

New market force

There’s consensus among security leaders that the private sector doesn’t want to be deployed for offensive hacking, said Adam Marrè, chief information security officer at Arctic Wolf. The talk of “hacking back” comes up every five to ten years, he said, but those talks break down every time for a number of reasons, mainly because of legal and ethical concerns.

Still, there’s no indication that the global cybersecurity environment is calming. Foreign adversaries would “absolutely” want access to powerful exploits that can steal information or wreak havoc on systems, Marrè said.

“[Adversaries] are mainly worried about what’s effective. So if it works, and if it ain’t broke, don’t fix it,” he said. “But if I can find a more exotic exploit that is going to allow me to have more access or access without being detected, or be able to get to somewhere I haven’t been able to get before, 100% they’re going to be looking for that."

Governments across the world are hankering for the latest and greatest hacking tools, said Elad Schulman, CEO of Lasso Security.

“If we are not developing capabilities, our enemies are developing those capabilities,” he said. “That is why we need to assume that, at any point in time, someone will find and use exploits against us.”

For years, companies have helped develop special technologies for the U.S. government’s secret cyber missions. But the new White House cyber strategy’s offensive focus sets a tone for companies and their investors, said Rob Joyce, the NSA’s former cybersecurity director.

“There’s been companies that are defense industrial base firms that know how to sell to the government, and there’s been some very boutique cyber companies that sell into the military cyber and intel community,” he said. “But this has the whole community and people out here in Silicon Valley who are not government-adjacent talking about ideas that they can help with in offensive cyber. I think it changes that ecosystem a little bit.”

Joyce is now a venture partner at DataTribe, which invests in early-stage cybersecurity companies often led by people who worked in the intelligence community. He said the government is in the market for an array of cyber capabilities, including vulnerability scanning, exploit development, tooling to analyze cyber threat data and digital infrastructure to obscure the origin of covert cyber operations.

Last week, the cybersecurity world was sent into shock when Anthropic revealed it was holding back a powerful frontier AI model that could find previously undiscovered vulnerabilities at mass scale. The intelligence community is already eyeing its capabilities, Nextgov/FCW reported.

Still operating defensively

Many practitioners are advising the cyber ecosystem to invest in defensive measures, regardless of the White House’s more offensive posture.

“Being a defender, an ounce of prevention is worth a pound of cure,” said Ryan Anschutz, the incident response lead at IBM’s X-Force threat intelligence arm and a former FBI official. “A defensive prevention perspective, I think, would have more of an impact … than offensive capabilities, which, quite frankly, some arms of the federal government—their offensive capabilities far surpass the private sector.”

Even among companies that simulate adversary cyberattacks to improve network defenses, known formally as red-teaming, the definition of “offensive hacking” can get fuzzy.

“Would you classify offensive hacking as going out and fingerprinting the threat that was attacking you to gain the threat intelligence?” Anschutz said. “Is that offensive? Where does that change? Where’s the line drawn between what is offensive and what’s not offensive?”

The answer depends on who you ask.

Hacking back, in the sense of breaking into adversaries’ computer systems for data and geopolitical intelligence, takes a level of access that only belongs in the government space, said another industry executive that works closely with the intelligence community on cyber matters.

Google’s threat intelligence arm recently came out swinging with discussions of its new disruption unit, though executives soon quashed the notion that the unit is “offensive” in any way, arguing that removing infrastructure that hackers sit on is a defensive move that impedes their forward operations onto U.S. and allied systems.

Some companies are building out advanced defensive cyber solutions at as rapid a pace as the offensive market, a sign that a more capable offense is driving equally urgent demand for stronger digital shielding.

“We had just seen too many examples over and over again of how burned out these poor kids in these security operations centers are, how just overwhelmed at the enormity of all the alerts, all the boxes always flashing red,” said Bill MacMillan, a former CIA official and now the chief product officer at security operations center solutions provider Andesite.

“We have to transform. We have to adopt this technology because this is the threat environment and the resource environment that we’re operating in,” he said.

Considering new frameworks

The offensive philosophy in Washington, D.C., has made some cyber experts weigh the pros and cons of the current legal environment that facilitates hacking activities.

The NSA, Cyber Command and others are permitted to take more aggressive cyber actions to stop foreign adversaries and criminal hacker gangs. This week, the FBI said it covertly sent shutdown commands to kick Russian state-backed hackers out of thousands of routers housed in organizations around the world.

The move, like many FBI takedowns of digital infrastructure, required court authorization. More broadly, some of the most sensitive intelligence operations do not rely on a standard U.S. court warrant at all.

Even so, private companies lack those authorities. They may build the capabilities used in cyber operations, but—like a defense contractor manufacturing a missile—the decision to deploy them and the consequences that follow rest with the government, not the company.

But what happens if a firm is hacked and wants to take action? There’s room to discuss “stand-your-ground” laws that could permit companies to respond to intrusions, at least to a certain degree, said Philip George, executive technical strategist at Merlin Cyber.

“Obviously, there are some authority issues and some rules of engagement concerns, and we don’t necessarily want everyone returning fire or preemptively thwarting an attack,” he said. But if attacked in cyberspace, “what’s the extent that I can return fire, to at least take down infrastructure that may be targeting me?”

Asked if such a legal authority constitutes a counter-attack, he clarified it as a “counter-action” or “counter-response” because the former term carries “a lot of weight.”

Some serious conversations will need to be had about the future of legal measures under this offensive posture, said John Fokker, head of threat intelligence at Trellix and a former official in the Dutch National Police’s High-Tech Crime Unit.

“If authorities are operating in the grey area with certain private sector entities, I’d much rather define and start talking about that grey area,” he said.

Information-sharing between the public and private sectors—a cornerstone of modern efforts to stop cyberattacks—should also continue, he said, though he argued the process should be streamlined given the number of existing groups.

But one executive said they expect the U.S. government will ultimately find ways to involve private contractors in offensive cyber operations, even as the administration publicly draws limits.

“I believe that the government will contract for cyber operations under carefully crafted contracts,” said Kevin Spease, president at ISSE Services. “It simply depends on how you define it.”

He pointed to past U.S. conflicts where private firms supported offensive missions, arguing cyber operations could follow a similar path.

The rationale, Spease added, comes down to capability. The government, in both civilian and defense agencies, already predominantly relies on technology made by the private sector for day-to-day operations.

“The private companies have far better expertise,” he said. “Sometimes it’s easier to have a contractor do it.”

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Defense Business Brief: Doubling down on C-UAS; Hypersonic flight; Could AI help the Navy build hulls faster?

Lauren C. Williams — Wed, 08 Apr 2026 13:00:00 -0400

The Pentagon wants to buy almost $1 billion—$994.1 million to be precise—worth of counterdrone tech in 2027, according to budget documents.

The request, under other Army procurement for counter-small unmanned aerial systems, is close to double the $596 million enacted for 2026, which includes atypical funding from budget reconciliation.

That funding spike extends to research and development too. The Army is asking for $26.5 million for counter-small unmanned aerial systems in applied research, which is more than double what is set aside for 2026. Plus, funding for c-UAS development could jump from $140 million in 2026 to $359.2 million proposed in 2027 if finalized by Congress, the documents show.

While some of the increases may reflect budget line consolidation, the proposal comes as U.S. military counterdrone tech spending is expected to grow. That could mean more contracts domestically and abroad as drone threats proliferate and militaries continue to look to the Russia-Ukraine war for best practices and tech.

The Pentagon’s counterdrone task force says it wants to buy $600 million in c-UAS tech to support the U.S.-Israel war on Iran, FIFA World Cup protection, and to protect critical infrastructure.

Drone threats and systems used to defeat them could be at an “inflection point,” Brett Velicovich, who co-founded the startup, Powerus, which helps deliver Ukrainian drone tech to the U.S. military, told Defense One. “The question is no longer detection, but kinetic, interception solutions at scale” and the proposed budget could be “a chance to prioritize affordable, deployable interceptor solutions…that can actually stop threats in real time.”

It’s a numbers game.

“The Ukrainians, as an order of magnitude, consider that they need to lose four drones for every one that they take down,” said Doug Abdiel, a Marine Corps reservist and global vice president at Advanced Navigation, which focuses on GPS alternatives and autonomous systems.

But being able to buy drones in large quantities is only part of the challenge.

“It's also a mindset shift around agility, and…how you use these assets,” he told Defense One, including “the notion that you would buy a drone to then do a kinetic kill on another drone. Or that you are going to have so much in your radar pattern that you're going to be unable to process all that information.”

Welcome

You’ve reached the Defense Business Brief, where we focus on what the Pentagon buys, who they’re buying from, and why. Send along your tips, feedback, and streaming recommendations to lwilliams@defenseone.com. Check out the Defense Business Brief archive here, and tell your friends to subscribe!

A new defense tech unicorn is born. Hypersonic aircraft maker Hermeus hit $1 billion valuation after a $350 million Series C funding round—and it plans to use that money to speed up production and make more prototypes.

The In-Q-Tel backed firm is also moving its headquarters from Atlanta to El Segundo, Calif., where it plans to expand prototyping and research and development efforts. While some employees are already in the new space, full relocation is expected in early 2027.
In the coming months, Hermeus’ Atlanta site will pivot to become the company’s manufacturing epicenter, producing its Quarterhorse aircraft.
“The team is now scaling to a fleet of three F-16 scale aircraft, accelerating our path to Mach 3 and starting customer payload integration,” a company spokesperson told Defense One.

HII dives into physical AI through a new agreement with Gray Matter Robotics to explore how it can be integrated into shipbuilding for manned and unmanned vessels.

The move is part of a larger strategy to increase productivity in shipbuilding, which involves complex, precise, and yet variable tasks like “grinding, blasting and finishing of metal structure,” Eric Chewning, HII’s head of strategy and maritime systems, told reporters. “There is a broader set of industrial use cases where we need a single robot to do 100,000 tasks just once. And that’s where physical AI is a game changer.”
Background: Navy Secretary John Phelan has pushed for more use of AI, automation, and robotics in shipbuilding—from back-office work to manufacturing and maintenance—to speed up deliveries and close workforce gaps.
But while robots aren’t necessarily new to shipyards, it may take a while before the HII-Gray Matter Robotics partnership has hard data on how much the technology can improve throughput.
“We've got to get the technology certified before we can put them in a production environment,” Chewning said, noting the paperwork process to get Gray Matter’s technology certified with the Navy is underway.
The emphasis now is on demonstrating how well the tech works.
“Once we can begin to demonstrate these technologies are qualified, and that our hypothesis around their integration [and] the value stream works, then we can begin to get them deployed into the shipyard,” Chewning said, adding that HII plans to install a Gray Matter Robotics cell at Ingalls. “So as quickly as we're able to, we're going to get these things instituted to help drive throughput.”

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Two firms picked as finalists for contract to outsource Army pilot training

Thomas Novelly — Tue, 07 Apr 2026 17:20:23 -0400

The Army has picked at least two finalists to take over the service’s entry-level helicopter training program, despite Congressional pushback on the plan last year. Service officials have said they plan to choose a winner by September.

Bell and M1 Support Services both confirmed in press releases this week that they were selected to move to the fourth and final stage of the competition.

Another competitor, Lockheed Martin, was not chosen to move on, a company spokesperson confirmed to Defense One.The Army did not immediately respond to a request for comment asking whether any other companies were selected.

Last month, it was reported that AAR Corp was also in the running for the competition. The Illinois-based company did not immediately respond to requests for comment.

Finalists will be asked to demonstrate how they could execute the service’s Initial Entry Rotary Wing training program more affordably and efficiently.

Funding for the effort to shift the in-house school to a contractor-owned and -operated model, dubbed Flight School Next, was paused by lawmakers in the most recent National Defense Authorization Act. The provision asked for a detailed report on the one-year pilot program and for Army Secretary Dan Driscoll to brief Congress on the cost-effectiveness and rationale before Congress would release funds for the contract.

An Army spokesperson did not immediately return a request for comment on Tuesday asking whether the service provided Congress with the results and briefing.

Despite the pushback and funding uncertainty, the competition is still marching on.

Bell is working with DigiFlight, Delaware Resource Group (DRG), V2X, Alpha 1 Aerospace, Semper Fly and TRU Simulation, the company said in a news release. The team’s bid is centered around Bell’s 505 helicopter as the trainer.

“Bell is proud to be selected for the fourth phase of the Flight School Next competition alongside our teammates,” John Novalis II, the company’s Flight School Next strategic director said in a press release. “Making it to this stage proves that Bell’s solution is strong and we look forward to demonstrating our ability to execute.”

M1’s team consists of General Dynamics Information Technology, Robinson Helicopter Company, Quantum Helicopters, and the University of North Dakota Aerospace Foundation. Its offering includes Robinson Helicopters’ R66 trainer.

A Robinson spokesperson confirmed to Defense One the company is working with multiple prime contractors for a Flight School Next offering.

“We are honored to advance to Phase IV,” George Krivo, M1’s CEO and chairman, said in a news release. “In this next phase, Team M1 will demonstrate our comprehensive, innovation-rich solution to produce more proficient Army Aviators on time and on budget.”

The Bell 505 and R66, both single-engine aircraft, are both departures from the Army’s current training helicopter, Airbus’ twin-engine UH-72 Lakota, which has been criticized by service leaders as being too expensive and restrictive for teaching aviation basics. An Airbus spokesperson referred questions to the Army when asked if the company was moving ahead in the competition.

A call-for-solutions document issued late last year says that the winner of the Flight School Next contract would produce 800 to 1,500 Army aviators annually for 26 years, with an award expected by September.

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Defense Business Brief: The Navy’s MUSV pivot; NGA taps Vantor for $2.3M spy satellite contract; and a bit more

Lauren C. Williams — Wed, 01 Apr 2026 12:00:00 -0400

The Navy doesn’t want robot boat prototypes, so it nixed its existing unmanned surface vehicle program in favor of an already-made-or-being-built strategy. That move rattled industry last week, but it could bring the Navy closer to getting what it says it needs in medium unmanned surface vessels.

Wargames showed the larger Modular Attack Surface Craft vehicle as having “too short a range (2,500 [nautical miles]) to be useful, and sometimes it was hard to effectively use its 16 missiles before the vessel was destroyed by counter-battery fire,” said Bryan Clark, who leads the Hudson Institute’s Center for Defense Concepts and Technology. But the service’s request for the vehicle “didn’t prioritize range, which ends up being the most important characteristic.”

The Navy canceled the MASC—Modular Attack Surface Craft—program a year after it started and several companies were building vessels in anticipation of an award expected in late 2025.

But this latest pivot to a marketplace format may give the Navy a chance to pick from existing technologies and allow defense tech companies to show what they can do. The new approach also means the Navy won’t have to buy prototypes and instead can focus on mature technologies, a Navy official told Defense One.

“I think the better approach is for industry to formulate their ideas on Navy MUSV concepts and propose them to the Navy,” which “can assess them through modeling and simulation to identify which systems and use cases are most effective,” Clark said.

The new solicitation for MUSVs tweaks the requirements—such as asking for longer range—and supplants the previous program in favor of a marketplace approach that will serve as a “regular and recurring competitive environment,” the Navy official said via email.

“Market research suggests that there are many companies capable [of entering] the marketplace, ranging from start-ups to established shipbuilding companies,” the official said. “The Navy is eager to hear from any and all of these competitors. The selected MUSVs will be driven by mission requirements. We will procure as many MUSVs in different configurations as required to meet Fleet needs.”

But while some defense tech companies Defense One spoke to support the changes, there was also frustration, particularly with the high upfront costs of the new solicitation requiring companies to build or present an autonomous boat that can ultimately handle performance tests—such as avoiding collisions with another vessel sans docking.

When asked about concerns that only companies with major financial backing would be able to compete, the Navy stressed its commitment to fostering competition.

“The Navy has been engaging with venture capitalists and tech investors for nearly a year, expressing the Navy’s demand signal. Armed with information about the Navy’s needs and requirements, these investors are using that knowledge to expand their portfolios,” the official said, naming the Pentagon’s Office of Strategic Capital as a resource for interested vendors.

Welcome

All about space awareness. The National Geospatial-Intelligence Agency awarded $2.3 million to Vantor to detect and analyze priority space objects in low Earth orbit in near-real time. The contract for NGA’s Luno B program. The work is already underway and provides automated analysis, which is typically a manual process, and alerts NGA of irregularities.

“This is all powered by our non-Earth imaging capability, our NEI…to capture high-resolution imagery in Space. And we can capture images that are under 10-centimeter resolution, and we can capture them from hundreds of kilometers away,” Susanne Hake, who leads Vantor’s government business, told Defense One. “And then we're able to do automated analysis on those images to help characterize” what the image is.
Background: Space domain awareness is becoming increasingly important for the military and intelligence community as competition or “dogfighting” with adversarial nations persist. This is the third Luno win for Vantor, formerly Maxar Intelligence. No details were provided about the length of the contract.
“Our previous task orders,” she said, “are focused on automated change detection on the ground and AI-enabled object detection across air, land, and maritime. So being able to also layer on that space domain, within that Luno construct, I think represents an ability for us to really build out this more complete, multi-domain picture.”

More space moves. Sierra Space named Jeff Schrader its chief strategy officer, a role where he will focus on the company’s expansion efforts, including mergers and acquisitions. Schrader was previously the vice president of strategy and business development at Lockheed Martin Space. The company also has a new CEO and was recently valued at $8 billion after a $550 million funding round.

In other space news: This week, Varda Space launched a reentry capsule, its sixth, with experimental payloads as part of an Air Force Research Laboratory project.

And one more naval thing: L3Harris Technologies is contracted to deliver a torpedo tube launch and eecovery system for an undisclosed amount in an other transaction authority award through the Pentagon’s innovation agency, the Defense Innovation Unit. “Our system is the first to successfully launch and recover AUVs from a submarine, providing commanders flexibility for persistent undersea operations and maintaining essential stealth,” Nino DiCosmo, the company’s president of maritime, space and mission systems, said in a news release.

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AI boat maker Saronic smashes $9 billion valuation

Lauren C. Williams — Tue, 31 Mar 2026 15:09:20 -0400

Robot shipbuilder Saronic raised nearly $2 billion to expand production and develop new vessels as the Navy seeks refined options for medium unmanned surface vessels.

“We're going to continue to scale and build out our shipyard in Franklin, Louisiana, and then we're going to invest heavily into Port Alpha, which is going to reshape the entire shipbuilding industry,” said Saronic CEO Dino Mavrookas, referring to a manufacturing plant it is building at an undisclosed site.

The $1.75 billion Series D funding round, led by Kleiner Perkins, brings the Austin-based defense tech startup to a $9.25 billion valuation. The round also included several new-to-Saronic investors, such as Advent International and Bessemer Venture Partners, and existing investors.

Saronic plans to use the money to expand its Franklin shipyard, where it’s building a 180-foot autonomous vessel named Marauder, and to build Port Alpha.

The massive defense tech investment comes as drone boats have proven their usefulness in global conflicts, including Russia’s war on Ukraine and the joint U.S.-Israel war with Iran, and as the U.S. Navy makes strides to integrate autonomous surface vessels into the fleet.

Autonomous surface vessels are a booming market with a lot of players. The Navy recently changed its strategy for assessing and buying medium unmanned surface vessels, pivoting to a marketplace focused on existing mature technology that they can choose from at a later date.

That marketplace format will be designed as a “regular and recurring competitive environment for robotic and autonomous technologies,” a Navy official told Defense One.

This move puts more emphasis on companies’ ability to build and deliver robot boats quickly to meet demand. And the Navy’s medium unmanned surface vessel marketplace gives “vendors a chance to propose combinations of attributes that they can deliver” that “align with the Navy’s operational problems,” Bryan Clark, who leads the Hudson Institute’s Center for Defense Concepts and Technology, told Defense One.

Speaking to reporters ahead of Tuesday’s announcement, Mavrookas said the company is “going to invest in Port Alpha. We look forward to sharing the news and the details of that when that becomes available, but that's going to be 10 [times] the capacity of our Franklin location.”

That mega-facility, which is still in the planning stages, is also expected to support building larger autonomous vessels for commercial and defense use.

Saronic is in the process of adding about 300,000 square feet to its Franklin shipyard, to increase production to 20 vessels a year. That expansion is expected to finish this year, a Saronic spokesperson told Defense One.

“Today, we’re focused on completing our Phase 1 expansion in Franklin, which is our existing $300 [million] investment into the shipyard. Demand continues to ramp from multiple customers for our MUSV fleet, and we will focus on meeting that need through continued investment and strategic expansion,” the company said.

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Former Trump advisor joins board of Ukraine-focused drone tech company Powerus

Patrick Tucker — Tue, 31 Mar 2026 09:30:00 -0400

Donald Trump’s former special envoy to Russia and Ukraine, retired Lt. Gen. Keith Kellogg, will join the advisory board of Powerus, a Florida-based startup seeking to build relationships with and acquire technology from Ukrainian drone makers to sell to the U.S. military, the company said in a statement Tuesday. The news signals warming commercial and financial activity between U.S. investors and Ukrainian defense technology entrepreneurs, even as U.S.-led diplomatic talks on ending Russia’s war appear stalled.

Kellogg commanded the Army’s 82nd Airborne Division and served as director of command, control, communications and computers (J6) for the Joint Chiefs of Staff. He was a national security advisor to then-Vice President Mike Pence during Trump’s first term.

The selection of Kellogg as special envoy to Russia and Ukraine in November 2024 won praise from Ukrainians, and seasoned diplomats. His military experience and the consistency of his hawkish views toward Russian President Vladimir Putin contrast with other current and former members of Trump’s cabinet. The Kremlin, naturally, was less enthusiastic about his selection and complained about Kellogg’s presence at peace talks. He stepped down last December, replaced by Steve Witkoff, a real-estate developer with controversial business ties to Russia and who also serves as the U.S. envoy to the Middle East.

The rise of Powerus is an indicator of the growing American interest in Ukrainian defense tech. Based in West Palm Beach, Trump’s sons are among the investors. Fired former Joints Chief Chairman C.Q. Brown also joined the company’s advisory board this month. The company plans to go public this summer after an already-announced merger with Aureus Greenway Holdings.

It also speaks to a disconnect between current White House rhetoric on Ukraine and the actions of those connected to U.S. leadership. On one side is the dismissive White-House line painting Ukraine as a charity case, overly reliant on the United States. On the other are military operators, experienced policy professionals, and, increasingly, the global early-stage investor class urging deeper partnership with a proven ally who is defining the future of defense technology.

Ukraine’s new diplomatic strategy is commercial

As peace talks continue, Ukraine is pursuing a new strategy to build diplomatic relations: commercial links, and co-business development, a group of Ukrainian government and military officials said last week in Washington, D.C.“The political environment is what it is, and so moving from inadequate integration to leading with defense tech integration on a business level with business partners and allies,” one Ukrainian official said during a discussion with a handful of analysts and journalists at the German Marshall Fund.

Signs suggest Ukraine’s strategy is working; the number of U.S. firms that focus on Ukrainian defense technology is growing, as is the number of venture capital outfits, such as Ondas Capital. Eric Brock, Ondas CEO, told Defense One in January that for Ukrainian startups, partnerships with U.S. firms make sense. But such pairings offer important positioning for U.S. investors in terms of accessing future defense markets.

“We’re better able to see where the winners are and layer them into an operating model … We can meet the demand, because [the market for Ukrainian drone and counter-drone tech is] going to be exploding. It's going to be this market exploding on infrastructure for drone and counter-drone technologies.”

Ukraine this week finalized deals with various Middle Eastern governments for technology sharing. The countries are in urgent need of air defenses against the Russia-launched, Iranian-designed drones that Ukraine has been contending with since 2023.

In March, Ukrainian drone company Swarmer announced an initial public offering on the Nasdaq and saw shares jump in value by a factor of eight.

“Ukraine taught us how big of an advantage drones have been to equalize its defense against what should have been a lopsided victory for the Russians. Small, cheap, mass-produced machines now obliterate state-of-the-art tanks and missile systems worth tens of millions, and intercept waves of kamikaze drones at scale,” Kellogg said in a statement. “Powerus is bringing that equalizing power and the same capabilities to the U.S.”

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War boosts counter-drone sales, joint ventures

Andrew Dardine, Forecast International — Mon, 30 Mar 2026 20:43:24 -0400

Mideast governments have long invested in air defenses—notably, U.S.-made THAAD and Patriot interceptors—and counter-drone defenses, particularly since the 2019 drone attack on Saudi oil infrastructure at Abqaiq. But recent weeks and months have seen a flurry of activity—in ventures by defense-tech companies and orders from nations under fire.

Last June, SRC announced it would deliver Raytheon Coyote interceptors as part of a $1 billion FMS deal with Qatar. The rail-launched missile has a boost rocket motor and a turbine engine to take down small and large drones and swarms.

In November, MBDA made its first sale of its Sky Warden system to a Middle Eastern country—likely Oman or another of the region’s heavy counter-drone investors. Sky Warden’s weapons include omni- and unidirectional jammers, a CILAS HELMA-P laser, and MBDA’s own Hit-to-Kill and MISTRAL 3 missiles.

On Feb. 28, just before the U.S. and Israel launched their joint attack on Iran, the State Department approved an FMS order to Jordan of Ku-Band Multi-Function Radio Frequency System radars, command and control system; generators; GPS receivers, and related equipment for an estimated $280 million.

On March 19, State approved the sale to the UAE of 10 Fixed Site-Low, Slow, Small Unmanned Aircraft Integrated Defeat Systems for an estimated $2.1 billion. The sale was reported to include 240 Coyote Block 2 All-Up-Rounds, 4-pack Coyote launchers,KuMRFS radars; EO/IR cameras; PYQ-10 Simple Key Loaders; Forward Area Air Defense Command and Control systems; support and test equipment; and other supporting elements.

Joint ventures

Some C-UAS programs can require the integration of more than a handful of elements—radar, electro-optical systems, communications, electronic warfare, command and control, AI, soft-kill jammers, hard-kill missiles, and more. This is leading to more teaming ventures and strategic partnerships—often, companies with niche expertise joining to offer fuller-service C-UAS systems.

On Jan. 7, U.K.-based Babcock International and Estonia’s missile-making Frankenburg Technologies announced an effort to develop an affordable, containerized maritime air defense system against single and massed drones.

Five days later, Axon Vision, a provider of AI-powered solutions for defense applications, said it had received an order from Leonardo DRS for its new AI-based system that detects, classifies, tracks, and intercepts C-UAS. The systems are to participate in operational evaluations and live exercises on manned and unmanned ground platforms.

In late March, Epirus, General Dynamics Land Systems and Kodiak AI joined to introduce the Leonidas Autonomous Ground Vehicle, a commercial truck equipped with Kodiak Driver, an AI-powered autonomous driving system, and armed with Epirus’ Leonidas C-UAS high-power microwave weapon.

More sales

On Jan. 20, Fortem Technologies announced the first deliveries of its DroneHunter 5.0 autonomous interceptor, just weeks after Pentagon’s C-UAS task force cleared the web-equipped quadcopter for sale under the Replicator-2 initiative. Each DroneHunter has two cameras and enough computing power to autonomously engage multiple targets. In February, the company announced another sale: a multimillion-dollar order for DroneHunters to protect U.S. venues at the 11-city, 2026 FIFA World Cup.

On Jan. 26, the Ukraine Navy gave Sierra Nevada Corp. a one-year, $14.9 million cost-plus-fixed-fee contract for C-UAS program field services, maintenance and sustainment. This contract also covers reach-back support for various systems deployed in Eastern Europe under NATO.

Four days later, Norway’s Kongsberg Defence & Aerospace and Polska Grupa Zbrojeniowa received a contract valued around NOK 16 billion from the Polish Armaments Agency for 18 C-UAS batteries.

In February, Lockheed Martin delivered to the U.S. Army the first Sentinel A4 radar system for integration and testing. Sentinel A4 is designed to detect and track small drones, low-flying cruise missiles, and other aerial threats in complex urban environments.

On Feb. 11, Raytheon demoed its microwave-equipped Coyote for the U.S. Army.

The next day, BAE Systems secured a cost-plus-fixed-fee indefinite-delivery/indefinite-quantity contract with a ceiling of $145 million to develop, build, and deliver C-UAS systems. BAE Systems has been marketing its BAE Systems Anti-Threat System, a command-and-control system to spot, classify, and defeat drones.

And the race to develop more drone-killing weapons goes on. On Feb. 19, The U.S. Army Contracting Command issued a request for information to identify new technologies for the Red Sands Hard Kill Challenge in Saudi Arabia, which aims to advance development of “hard kill” weapons to defeat small (Group 1-3) drones in complex and contested environments.

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New anti-DEI requirements imposed on federal contractors

Sean Michael Newhouse — Fri, 27 Mar 2026 16:14:41 -0400

President Donald Trump on Thursday signed an executive order targeting diversity, equity and inclusion programs at companies that are federal contractors.

While contractors are already subject to anti-DEI directives that the president enacted at the start of his second term, Trump wrote that this new order is necessary because “some entities continue to engage in DEI activities and often attempt to conceal their efforts to do so.”

Under the directive, agencies must ensure that contracts and subcontracts, within 30 days, include a clause that states the contractor:

Will not engage in DEI activities.
Agrees to provide information and reports to assess compliance.
Acknowledges that noncompliance with the order could lead to the termination or suspension of the contract and the company being barred from future government contracts.

The order defines “racially discriminatory DEI activities” as “disparate treatment based on race or ethnicity in the recruitment, employment (e.g., hiring, promotions), contracting (e.g., vendor agreements), program participation or allocation or deployment of an entity’s resources.”

While noting that racial discrimination in employment has been illegal for decades, Julia Judish, a special counsel at Pillsbury law firm, said that the inclusion of “recruitment” in the definition is an “about face” for federal contractors.

Government contractors had been required to implement affirmative action programs, but on the second day of his second term, Trump repealed an executive order from the 1960s that mandated such a requirement. That led to cuts at the Office of Federal Contract Compliance, a Labor Department agency that enforced the directive.

“It’s the flip of what had been required of government contractors over decades,” Judish said.

She also predicted that the new order will create uncertainty for contractors.

“Does this mean that, if a government contractor participates in a career fair at a historically Black college or university, is that viewed as a racially discriminatory allocation or deployment of their resources in support of recruitment that is more likely to reach potential applicants based on race or ethnicity?” she said. “So there’s a lot of questions.”

The new directive also requires the Office of Management and Budget, in coordination with the Justice Department, assistant to the president for Domestic Policy and Equal Employment Opportunity Commission, to “identify economic sectors that pose a particular risk of entities engaging in racially discriminatory DEI activities based on current or past conduct and issue additional guidance to contracting agencies regarding best practices to ensure compliance with this order within such sectors.”

Additionally, the order authorizes the Justice Department to sue contractors and subcontractors that violate these requirements and mandates changes to the Federal Acquisition Regulation in order to ensure the rules correspond with the new directive.

The second Trump administration has prioritized cutting employees and programs that officials determine perform work related to DEI.

For instance, the Interior Department this month reminded employees that they should report any suspected DEI activities and that doing so is considered to be a protected whistleblower activity.

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Defense Business Brief: Pentagon equity stakes FTW?; Hill & Valley Forum takeaways; plus a bit more

Lauren C. Williams — Wed, 25 Mar 2026 13:00:00 -0400

The Pentagon’s equity stake in critical minerals company MP Materials seems to be paying off.

“We were on the verge of an economic shutdown” last year as China restricted rare earth magnetics exports to the U.S. said James Litinsky, the CEO of MP Materials, during the Hill & Valley Forum on Tuesday.

“At that time, we were beginning the process of our deal with the Pentagon…we ultimately got that deal done in July, that public-private partnership. And so fast forward a year, and the good news is…we've been really maniacal in getting this supply chain home.”

Last year, the Defense Department became MP Materials’ largest shareholder with a $400 million stock buy. Less than a year later, the company has made progress bringing its rare earth magnetics supply chain to the U.S.—though there’s still more to do.

The company is now producing “at scale” in its Fort Worth, Texas, factory and is looking to expand, Litinsky said. The goal is to speed up production tenfold as part of a $1.25 billion investment to build what they refer to as the 10X manufacturing campus.

“We've done the vast amount of the long-lead procurement for our 10X magnetic factories we're doing in partnership with the Department of War…We've got a long way to go, but it is certainly night and day from an industry perspective,” Litinsky said.

The Pentagon has made it clear that it will use every financial lever it can to improve defense supply chains, including equity stakes.

“Even before the transformation strategy rolled out, I think the MP Materials deal was the first of several deals that we rolled out…where we're attempting to stabilize the demand signal over a sustained period of time so that corporations and investors [can] have the confidence to make an investment that will provide a return on that investment,” Michael Duffey, the Pentagon’s top weapons buyer said on stage Tuesday.

So far, that strategy seems to be working for MP Materials, and for the plan to reshore critical minerals to the U.S.

“We are underway in solving it; we don’t need to convince anyone anymore,” Litinsky said.

Welcome

Hill + Valley vibes. The Hill & Valley Forum started as a large dinner event to bring policymakers and tech builders together. It now boasts more than 1,000 attendees. This year, the stunning but hard-to-drive-to Andrew W. Mellon auditorium was buzzing with lots of hurried men in dark suits. The aesthetics were gilded, the mood was collegial with fist bumps and bro hugs, and the panels were chill. Even the fireside chat with JPMorgan Chase CEO Jamie Dimon, who was a major draw, felt very relaxed. House Speaker Mike Johnson also dropped by to speak as a last-minute addition.

Takeaways: When asked which U.S. alliances needed more attention, Dimon said:“I think the one we need to strengthen more is Europe,” including through NATO and the overall economic relationship.

“They're trying to spend money. They're starting to look at their own defense industrial base, which needs a lot of work, by the way,” he said.
Dimon argued that European policies, such as clean energy commitments, have hampered their economic growth, including a widening GDP gap with the U.S., which could have repercussions.
“That's gonna hurt us one day…when the economy can no longer afford the military they need. That's the problem. And Europe is kind of there right now,” he said, “they need our help.”
On a separate panel, Rep. Riley Moore, R-W.V., and former welder, said AI could help extend blue-collar workers’ careers, particularly in manufacturing.
Artificial intelligence is “going to be a big part of the future of manufacturing in the United States because “its going to make people safer, it's going to make them more productive and bring longevity to their careers,” especially since injuries can be common, Moore said. “You tend to get injured. You’re going to get hurt. I've been hurt…AI has the ability to mitigate, minimize those and really create efficiencies.”

Making moves

C.Q. Brown, former chairman of the Joint Chiefs of Staff, joined Powerus, which produces autonomous systems and software for the military, as a senior adviser and resident executive. In a LinkedIn post announcing the move, Brown said he would focus on “defense strategy, autonomous systems deployment, and national security partnerships.”
John Luddy, former vice president of Aerospace Industries Association, was named interim executive director of the U.S. Partnership for Assured Electronics, which focuses on the defense electronics industrial base.

In other news

The Army has an Amazon-powered drone store. The service now has a one-stop marketplace where drone shoppers can “compare system functionalities, provide direct feedback, and place orders with ease,” the service announced Tuesday.

The online store is key to Army Aviation’s modernization strategy and “allows us to equip our soldiers with the unmanned technologies they want and need to maintain overmatch on a complex battlefield,” Maj. Gen. Clair Gill, the portfolio acquisition executive for maneuver air said in a news release.

Flight test. Northrop Grumman successfully tested Shield AI’s Hivemind software—which is also paired, and has flown, with Anduril’s CCA offering

AI funding round. Striveworks announced a Series B funding round, but is keeping the dollar figures close. The company focuses on validating algorithms used in the defense and intelligence missions to ensure they can be trusted—a function that will become increasingly important as the Pentagon and military services proliferate AI throughout their processes and systems.

CEO Jim Rebesco told Defense One the round would be used to expand engineering and research and development.

“We’re seeing this big, big bow wave demand for agentic AI generally and, bluntly, how we make that agentic AI work in the defense space specifically,” he said. “This is a chance for us to get ahead of that demand signal…and expand our ability to serve more defense and intelligence customers.”

The CIA could lose oversight of In-Q-Tel. The Office of the Director of National Intelligence plans to subsume In-Q-Tel—a venture capital firm backed by the CIA, Politico reported. The organization has been a key factor in early investments into companies focused on emerging technologies imperative to national security. It’s also been heralded as a model to emulate, according to the Federation of American Scientists. Bonus: here’s a vintage Defense One look at what In-Q-Tel has to offer.

One last thing: Epirus, General Dynamics, and Kodiak AI are teaming up on an autonomous ground vehicle counter drone system.

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Tiltrotor who? US military helicopter deliveries rose 13 percent in 2025

Jon Hemler, Forecast International — Tue, 24 Mar 2026 23:53:36 -0400

With all the talk of tiltrotors, you'd be forgiven for believing the era of conventional rotorcraft is winding down. But last year, the big three American rotorcraft manufacturers—Bell, Boeing, and Lockheed Martin's Sikorsky—delivered a combined 199 military rotorcraft: 13 percent more than in 2024.

By the Numbers

Sikorsky delivered the most in 2025, anchored by the H-60 line: a total of 101 Black Hawks and Seahawks. Boeing recorded the most growth, increasing annual deliveries by about 22 percent. Bell experienced the only decline among the three companies, delivering ten fewer aircraft in 2025 as AH-1Z exports taper and MV-22 Osprey production for the U.S. Navy and Marine Corps nears completion.

Fall 2025 showed huge contractual wins for Boeing and Sikorsky’s key military helicopter programs. Building on a long-developing agreement, Boeing announced in November that it will build 96 AH-64E Apache attack helicopters for Poland. The deal, valued at $4.7 billion, will make Poland the 19th operator of Apaches—and give it the largest fleet outside of the U.S.

Boeing also secured over $1.6 billion in contracts for its heavy-lift Chinook series late last year. Included in those awards are funding to accelerate U.S. Army fielding of the CH-47 Block II, agreements for the MH-47G for U.S. Special Operations Command, and $876.4 million to produce up to 60 CH-47F Block II helicopters for Germany.

Meanwhile, Sikorsky inked a historic $10.9 billion contract with the U.S. Navy, confirming the Marine Corps’ long-term commitment to the CH-53K. The five-year framework secures five production lots for up to 99 helicopters.

Defense One sister brand Forecast International projects Boeing to build more units from 2026 through 2030, but our estimates show that Sikorsky will build a larger share, about 40 percent, of the total market production value. This prediction is primarily due to the high unit cost of the powerful triple-engine King Stallion.

Tiltrotor Transition

Bell is producing fewer aircraft for the moment, as it prepares to introduce the MV-75 tiltrotor for the U.S. Army Future Long Range Assault Aircraft (FLRAA) program. Assembly work is now underway on the first test aircraft. Bell and the U.S. Army are prioritizing the rapid fielding of the MV-75, with initial production expected in the next one to two years.

Bell’s market position will rise during the mid-2030s as it approaches full-rate manufacturing of the MV-75. Cumulatively, the program could ultimately approach $70 billion. While Boeing and Sikorsky’s helicopter portfolios remain rooted in modernized legacy designs, the MV-75 represents the first clean-sheet U.S. rotorcraft since the joint Bell-Boeing V-22 Osprey entered service nearly 20 years ago.

As the military rotorcraft market moves from today's aircraft to tomorrow's in the next decade, the overall forecast remains robust. Bell, Boeing, and Sikorsky will produce nearly 600 units during the next three years. Meanwhile, rotorcraft demand remains strong in the broader market. European-based Airbus Helicopters delivered 31 more units in 2025 than the previous year across its civil and military product range. The company also reported 544 gross orders in 2025, up from 455 during 2024.

Hybrid Horizon

Naturally, the proliferation of uncrewed systems and drone warfare has raised questions about the viability of manned military rotorcraft. Nonetheless, current market signals project stability and reinforce the utility of these aircraft in contemporary environments. If anything, these forces are driving traditional prime contractors to integrate emerging technologies with their existing platforms while developing next-generation initiatives.

Hedging on the momentum of the U.S. Air Force Collaborative Combat Aircraft (CCA) program, Boeing debuted a similar drone wingman concept last October for accompanying U.S. Army rotorcraft. That same month, Sikorsky unveiled a tablet-controlled UH-60L helicopter, the U-Hawk, which features the company’s MATRIX autonomy suite. More recently, Sikorsky announced a joint project with the Robinson Helicopter Company–a world leader in civil rotorcraft–to integrate MATRIX with the R66 TURBINETRUCK, an autonomous helicopter built on the R66 airframe.

For its part, Bell has been working on uncrewed rotorcraft capabilities for years, most notably under a joint Defense Advanced Research Projects Agency (DARPA) and SOCOM program. Earlier this month, Bell announced that its Speed and Runway Independent Technologies (SPRINT) design entry received the designation X-76, clearing the way to build a high-speed demonstrator. That prototype will likely feature Bell’s revolutionary Stop/Fold rotor system to meet SPRINT requirements for a 400-plus knot aircraft that can operate from austere environments.

Proven Legacy

Uncrewed technologies aside, rotorcraft are demonstrating renewed mission versatility. Israeli and Emirati AH-64 Apache attack helicopters have reportedly downed Iranian Shahed drones in recent combat operations. Likewise, the U.S. Army is testing Apaches for Counter-UAS applications using the underslung 30mm cannon and guided munitions via Advanced Precision Kill Weapon System (APKWS) kits from the stub-wing pylons.

The integration of launched effects and standoff weapons, paired with doctrinal adaptation, is significantly enhancing rotorcraft survivability. High-speed tiltrotor design and uncrewed systems may define the future, yet conventional attack and utility helicopters remain vital, evidenced by market data and operational necessity.

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Defense Business Brief: DOD lab audits?; Notes from McAleese; Spotlight on Alabama manufacturing

Lauren C. Williams — Wed, 18 Mar 2026 18:30:00 -0400

The Pentagon should audit its labs and their projects to make sure scientists aren’t developing technology that can be bought off-the-shelf or spun up by startups, according to a recommendation from the Ronald Reagan Institute’s latest National Security Innovation Base report card.

"The review would specifically be focused on, given all the emphasis on commercial first, ensuring that those organizations and that funding is properly aligned and not duplicative of, or in some cases, competitive of what commercial industry is doing,” Eric Snelgrove, a subject matter expert who contributed to the report, told Defense One. “If you look at why the service laboratories exist in the first place, oftentimes it's a very unique mission…If it's a 20-year project, private capital is probably not going to fund a private entity to conduct that research.”

The proposed review would focus mostly on the military services’ laboratories, federally funded research and development centers, and university-affiliated research centers, with the Pentagon’s newly reorganized Science, Technology, and Innovation Board leading the charge. There’s also, of course, a place for the Congressional defense committees to oversee the effort.

“How can the labs enable the private sector to move faster, and how can we better leverage all of the private capital that's being funneled to private companies to deliver capability,” Snelgrove told reporters at a Defense Writers Group event. “And maybe that means, expanding the use of government hypersonic wind tunnels and making those more accessible to industry. Maybe it's [providing] compute resources for private industry, but making sure that the government laboratories are enabling the private sector, and, again, not competing with them.”

Moreover, the idea is to make the labs, and funds they get, as effective as possible.

“You always need independent experts. You always need tests and evaluation,” Snelgrove told Defense One. “But given all the incentives and the reform that's been going on to attract more commercial entrants—and the success of a lot of those initiatives—now, I think it's time to re-look at what the public sector R&D looks like.”

The concept begs at least two more questions: Does the Pentagon even know all of the research projects under its purview and how they’re going? Is the woeful valley of death the result of a fundamental disconnect between deep scientific research and the rapid development in industry?

Welcome

Notes from McAleese. Speaking at the annual defense-programs conference run by McAleese & Associates in Arlington, Va., Emil Michael, the Pentagon’s chief technology officer, said removing Anthropic from the Defense Department’s networks would be minimally disruptive.

“They all have different strengths,” Michael said of the different generative AI models the Pentagon is using. “The idea was to present all of them to the department. They may all converge in capability if you get this recursive learning sort of concept going in these models. But for now, we need to have more than one option, and ideally all options, and then maybe marry them over time. And I'm pretty confident.
Update on rollout: “We've already deployed OpenAI in the last few weeks, and…we have deployed [Google’s] Gemini. So as these things move up echelon into different classification networks, the warfighter is going to have tons of different options. And what we're seeing so far is the workflows are very similar. So the disruption is, we think, minimal,” Michael said Tuesday.
On LUCAS drone production: This is a "relatively new thing for us, so we haven't gone through the process of what the goal is” with the aim to “mass produce them in this country and have surge capacity so that when we need them, we can create more quickly without having to wait.”
Bonus round: Budget folks in the Pentagon are largely “pencils down” on the 2027 budget, said Jules Hurst, who is performing the duties of comptroller and chief financial officer. The goal is to have the detail-laden justification books out by April.

Sweet Alabama manufacturing. Raytheon just finished a $115 million expansion to its Redstone Missile Integration Facility in Huntsville, Ala. The move adds 43,000 square feet and increases the facility’s “integration and delivery capacity by over 50 percent,” a company spokesperson told Defense One.

The new space boasts two new test cells, a bigger factory and dock, and more office space.
There will be robots! This year, Raytheon plans to add to and upgrade its mobile robot fleet that helps transfer missiles and other items in the factory, called automated guided vehicles. Having more robots means items can be moved faster and, ideally, keep up with higher production needs.
One to watch: AI-factory company Hadrian is expanding its foothold with a new Navy partnership that includes a 2.2 million square-foot facility to boost shipbuilding capacity in northwest Alabama. I interviewed CEO Chris Power last year, when he previewed expansion plans.
A related tangent: Anniston Army Depot increased wages for about 1,500 employees. This matters because workforce challenges, namely pay and experience, are key obstacles to production and maintenance of military weapons and equipment.

In other news

Anthropic gets legal boost from civil liberties groups. The Center for Democracy and Technology and the American Civil Liberties Union filed an amicus brief to support Anthropic in its lawsuit against the Pentagon for labeling it a national security risk. Background: The Defense Department issued a memo earlier this month to remove Anthropic from all systems and networks in the next 180 days.
Havoc AI is adding aerial and ground autonomy to its portfolio after buying two companies: Mavrik and Teleo. This tracks per my last conversation with CEO Paul Lwin when he sketched out the concept where “one person can control maritime drones, aerial drones, ground drones, and make it all do something sophisticated.”
Ursa Major flight test of the Draper liquid rocket engine with the Air Force Research Laboratory hit “supersonic speeds” and demonstrated how the Air Force can “leverage our acquisition models to rapidly deliver critical technology advancements,” AFRL Commander and Air Force Technology Executive Officer Brig. Gen. Jason Bartolomei in the news release. Ursa Major CEO Chris Spagnoletti said it took just eight months to go from “contract to flight-ready” propulsion system.
U.S. drone company Vector signed a memorandum of understanding with Saudi Arabian company SR2 Defense Systems to make, assemble, and upkeep systems in Saudi Arabia. Vector was a competitor in the Pentagon’s Drone Dominance program.

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Anduril secures $87M contract for a common counter-unmanned C2 program

Meghann Myers — Mon, 16 Mar 2026 17:09:19 -0400

The Army-led Joint Interagency Task Force 401 has made one of its first major steps to securing interoperable counter-unmanned systems: selecting Anduril’s Lattice command-and-control software as a common platform for any system bought in the government’s marketplace.

The $87 million contract is part of a larger agreement the Army signed with Anduril last week, to the tune of up to $20 billion over the next decade, to authorize any federal agency to purchase Anduril’s commercially available products, the company’s chief business officer told reporters Monday.

“There's going to be a push to centralize other [Defense Department] and federal spending against it, and that will all sort of add into the overall discounts that the government receives,” Matthew Steckman said.

The contract isn’t the first of its kind, Steckman added, as enterprise contracts for IT software have been commonplace. It is just more complicated than previous frameworks, because Anduril makes a wide variety of products, from software to drones to virtual-reality headsets.

The Army alone has 120 existing contracts that will migrate into the new enterprise agreement immediately. Beyond that, new purchases will go through Army Contracting Command instead of requiring the creation of a new agreement.

"The modern battlefield is increasingly defined by software. To maintain our advantage, we must be able to acquire and deploy software capabilities with speed and efficiency," Gabe Chiulli, chief technology officer for the DOD’s Office of the Chief Information Officer, said in a release. "Enterprise contracts are a key part of our modernization strategy, allowing us to consolidate software agreements, eliminate redundancies, and accelerate the delivery of critical tools."

That could include Lattice, which JIATF-401 selected for its counter-unmanned systems, and that the Army is already using to build its next-generation C2 platform.

“In particular, this will affect very positively the new wave of defense companies coming into the ecosystem, where it's just a massive friction reducer,” Steckman said.

Asked whether Anduril will announce every new buy that comes through the enterprise agreement, Steckman said the company will continue to publicize major awards.

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Demand signals are up, but supply chain risks may still hinder production

Lauren C. Williams — Fri, 13 Mar 2026 21:18:01 -0400

The Defense Department is planning more multiyear deals and expects they’ll help smooth kinks in fragile supply chains. But the way prime contractors manage their suppliers, and the potential for bottlenecks, could stall progress.

Quadrupling munitions production “takes leadership—and I think we've got that in the [defense] secretary and the deputy. I think it takes money. I think it takes commitment,” Michael Duffey, the Pentagon's acquisitions and sustainment chief, said Thursday at the Ronald Reagan Institute’s national-security summit.

Duffey said multi-year procurement deals, such as recent ones with Lockheed Martin and RTX, have helped create “a trust level with industry because of that frequent engagement.” The hope is that conditions set in those deals will flow down the prime contractor’s supply chain.

“One of the key components of the deal is that all the conditions that are a part of the prime contractor will flow down. So the longevity of the deal will benefit all the suppliers, all the way down the supply chain, which hopefully then incentivizes a flywheel of investment in the key components, in the raw materials that we need,” Duffey said, noting that high engagement with industry has helped foster conditions for these types of deals.

While the Pentagon is happy with progress so far, Duffey said “not every program will be a perfect candidate” for long-term production deals. Those that would be a good candidate share a few things, including long-term need, lack of an emerging competitor, and “ramp time” needed to build a supply chain and intellectual property.

“That all, kind of, creates the incentive for a long-term deal here. And putting that contract in place, not only to incentivize the contractor to make the investment, but it's putting real penalties in to ensure that we're able to stick to the present and the secretary's priority, which is speed and volume,” Duffey said.

In its annual report card analyzing the defense industrial base, the Reagan Institute found the Pentagon has gotten better at telling industry what its modernization plans are compared to a year ago—jumping from a D-plus to a B-minus—but still struggles to make those plans a reality.

Roger Zakheim, who leads the Ronald Reagan Institute in Washington, said the second Trump administration’s moves thus far have been positive “building blocks” for substantive change, but there is still a long way to go.

“There are great aspirations for what has to happen within our innovation base and the impact it should have on our national defense. And we haven't seen sufficient, in our judgment, movement there. The production, the modernization is sort of not revealing itself across the force like we think it should,” Zakheim told reporters at a Defense Writers’ Group event ahead of the summit. “But at the same time, we have seen some significant movements, particularly this year, in the customer clarity,” due to policy shifts, among other things that “could ultimately drive this defense modernization.”

Defense modernization has received a grade of ‘D’ on the institute’s report card since 2024.

Some of the positive signs the report mentioned: acquisition reform and reorganization efforts, talks of $1.5 trillion defense budgets, and procurement contracts spanning several years—which have clarified the Pentagon’s intentions with industry.

But supply chain risks persist and likely need more attention.One of the barriers to increased production and defense modernization is supply chain management, which the Pentagon has typically left up to prime contractors, said Frank Futcher, the former director of NavalX.

“I think for too long, the Department of War has relied on the big primes to do all of that, like it was more of the hands off, laissez faire economy…We've now started to shift to more of an industrial policy,” said Futcher, who is now a consultant with Ernst & Young.

There's a misconception that major defense contractors “go deep down the supply chain…on a day-to-day basis” and can actually see where risks to production could be, he said.

“There could be a mom and pop shop. There could be long lead material that they don't realize that's going to prevent them from scaling,” Futcher said. “And I think the program offices, or now these new PAEs, these portfolio acquisition executives, have to make this a priority…they really need to be working together with industry in much more of an established sort of industrial policy as to how they're going to do this together.”

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Defense Business Brief: 3D-printing on the battlefield; Reshoring drone dominance; AI on submarines

Lauren C. Williams — Wed, 11 Mar 2026 13:00:00 -0400

The Pentagon plans to buy 30,000 one-way attack drones this month, but the military’s ability to repair or even build drones on the battlefield could make or break operations in modern conflicts.

So when Dan Magy, the CEO of Firestorm, first told me in December about a mobile industrial-grade 3D printing shop inside a shipping container, I needed to see it for myself. And I did, a couple months later on a rare rainy day in San Diego.

The entire setup felt like walking into a field lab—white floors, ceilings, and walls draped in vinyl sheets—and smelled like brand new toys just ripped out of the package. There’s a giant computer that shows renderings of what’s to be printed. A table displayed a smorgasbord of what was made—neck braces, satellite antenna, splints, drone arms, and what could only be described as a giant wrench.

“You hit print and then you come back in six to 12 hours and you're done,” Magy said. “When you want to move it, this processing station will roll and then these two sides roll up, and then you can just ship it. And then it takes about two hours to redeploy. So you just pull it up, and away you go. Put it on a boat, a plane.”

The HP printers are massive, like two coffins stacked on top of one another, and set up in a climate-controlled container, called XCell, which can be broken down and assembled in a few hours. This particular mini factory is two 20-foot units connected, measuring just shy of 1,200 square feet, and includes a chamber to clean and remove particle dust from the 3D prints.

“It's an advanced manufacturing line,” Magy said. “We were using [the HP printers] already to make our drones. Then we were asked by the end user to figure out how to put this in a box so we could build stuff where we need it, as opposed to waiting 18 months for resupply on drones.”

Firestorm is building a library of the most in-demand items for battlefield and humanitarian use, while also working with the government to create an easily searchable database for computer aided designs the military might need.

“A lot of these are parts that the end users have either designed or asked us to build because the supply chain can't sustain them. Remember, there's no Pep Boys or AutoZone in defense. You can't go to the store. So we're building things like engine coolant pans,” Magy said. “Now, you don't need to ship all these components. We'll just have libraries full of things we can print” at a much cheaper rate.

It’s a growing field gearing up to match the military’s need to deploy drones by the thousands.

“The military has looked at expanding the use of 3D-printed parts in everything from Humvees to rocket motors and hypersonics. There's also a big upside for organic maintenance depots...if the military can print its own 3D parts in the field, that cuts down on maintenance costs, reduces equipment downtime, and increases overall capacity at the depot,” said Shaun McDougall, a lead defense analyst for Forecast International.

Magy said the next year is about expansion, including printing with other materials beyond the current nylon composite and designing their own medical products, such as knee braces.

“What you're going to see over the next year is a dramatic expansion in advanced manufacturing capabilities we're going to be containerizing. We think this covers a part of the pie. We want to expand,” he said.

Welcome

Drones in the USA. The Pentagon wants to buy more than $1 billion in small drones in less than two years—while simultaneously making sure those drones are free from China-made parts and subcomponents. And the first big test starts this summer.

Travis Metz, the Pentagon’s Drone Dominance program manager, told the Senate Armed Services Committee last week that while all drones it delivers to troops are compliant with current legal bans on certain foreign-made small UAS, the plan is to be “more prescriptive than the NDAAs in terms of not allowing various components to be included in the systems that we procure, with the long term goal of building a drone supply chain that is American.”
“We'll be placing orders in August for Phase Two. We will not be allowing any Chinese batteries and motors in Phase Two, in addition to other restrictions that we'll be imposing that are above and beyond the current statutory restrictions,” Metz said.
The Pentagon wants to order 30,000 drones in the coming days, after a recent tech competition at Fort Benning, and at least another 50,000 in August after the next competition phase, Metz said. The goal is to deliver 300,000 by 2027 and keep that pace for a few years.

AI “copilots” on submarines. Despite the age of the Navy’s fleet of attack submarines, the service is focused on inserting the latest tech when it can, said Vice Adm. Richard Seif, commander, Naval Submarine Forces.

“So, today we have 48 attack submarines,” which are a mix of newer Virginia-class submarines, and older Seawolf and Los Angeles-class submarines, some of which are “over 30 years old,” Seif told the U.S.-China Economic and Security Review Commission.
“Today, we have over a dozen submarines that have, really, state-of-the-art algorithms. We call it a copilot for AI/ML. Anywhere you have a lot of data and not a lot of analysts to look at the data just it screams for AI/ML, as an example,” Seif said.
That ability to update submarines with new technology “underpins” deterrence, he said: “And so going forward, whether it's quantum, whether it's artificial intelligence, machine learning, or the new capability, or even unmanned systems, as we integrate those payloads, we’ll be fully ready to do that.”

One last thing: Check out this very cool image of the Civil War-era USS Monitor on the seafloor.

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Anthropic sues DOD, Hegseth, and a dozen other federal agencies

Alexandra Kelley — Mon, 09 Mar 2026 17:14:00 -0400

Anthropic is suing more than a dozen federal agencies and government leaders such as Defense Secretary Pete Hegseth, claiming that the federal government's blacklist is illegal retaliation.

In a March 9 court filing with the U.S. District Court in the Northern District of California, Anthropic claims that defendants named in the lawsuit are illegally punishing Anthropic for its decision not to change the terms of use for its AI product to work with the Department of Defense.

The court filing offers background into Anthropic’s product, the large language model Claude, and its extensive work within the federal government, particularly within the Pentagon.

It discusses the events that unfolded in the disagreement about Claude use cases within DOD, particularly surrounding uses to surveil U.S. citizens and control autonomous weapons. Anthropic asserts that the government's actions after this disagreement — primarily the designation of the company as a supply-chain risk and alleged violations of its right to due process through a lack of “core requirements” such as “adequate notice and a meaningful hearing” — are illegal and “are harming Anthropic irreparably.”

“These actions are unprecedented and unlawful,” the lawsuit reads. “The Constitution does not allow the government to wield its enormous power to punish a company for its protected speech. No federal statute authorizes the actions taken here. Anthropic turns to the judiciary as a last resort to vindicate its rights and halt the Executive’s unlawful campaign of retaliation.”

The lawsuit alleges that the Trump administration’s actions against Anthropic are based on pure ideological disagreement and are not due to “any legitimate procurement or security concern.” Anthropic further claims that it even attempted to support the Pentagon’s shift from Anthropic software to other, more compatible systems, further underscoring the “viewpoint-based” actions taken against the company.

“Indeed, while operating under the terms of the Usage Policy, the Department [of Defense] never previously raised any issues with its use of Claude or concerns about Anthropic’s potential interference,” the document reads. “Anthropic had only ever received positive feedback about Claude’s capabilities from its government customers.”

A separate lawsuit, filed in the D.C. Circuit Court of Appeals, further requests a judicial review of the supply chain risk label, citing provisions in the Federal Acquisition Supply Chain Security Act of 2018.

“Anthropic petitions this Court for review because the Department of War’s actions are, among other things, a pretextual form of retaliation in violation of the First and Fifth Amendments to the U.S. Constitution; arbitrary, capricious, and an abuse of discretion; unsupported by the administrative record; not in accord with procedures required by law; and in excess of statutory authority,” the second filing states.

Anthropic and DOD's failure to reach an agreement on the use of the former’s technology and the resulting governmentwide actions — namely President Donald Trump’s order for all federal agencies to cease using the technology and the Pentagon designating it as a supply chain risk — have fallen under scrutiny.

A current defense official told Defense One that it will not be easy to shift systems that had relied on Anthropic’s technologies to those of another vendor, and experts like Anthony Kuhn, a managing partner at the New York law firm Tully Rinckey, predicted that the supply chain risk designation in particular could open the Pentagon to lawsuits.

In response to the lawsuit, White House spokeswoman Liz Huston said the Trump administration’s goal is for the military to operate under the U.S. Constitution, “not any woke AI company’s terms of service.”

President Trump will never allow a radical left, woke company to jeopardize our national security by dictating how the greatest and most powerful military in the world operates,” Huston said in a statement to Nextgov/FCW. “The President and Secretary of War are ensuring America’s courageous warfighters have the appropriate tools they need to be successful and will guarantee that they are never held hostage by the ideological whims of any Big Tech leaders.”

Nextgov/FCW has reached out to Anthropic and the Commerce Department for comment. GSA and the Pentagon declined to comment on ongoing litigation.

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Missile makers agree to ‘quadruple’ production, Trump says

Lauren C. Williams — Fri, 06 Mar 2026 23:07:38 -0500

Updated: March 9.

Defense companies have agreed to make four times as many missiles, President Donald Trump said Friday, denying reports that his war on Iran was quickly draining stocks of key munitions.

“They have agreed to quadruple Production of ‘Exquisite Class’ Weaponry in that we want to reach, as rapidly as possible, the highest levels of quantity,” Trump wrote in a post on his social-media network, Truth Social. No quantities, weapons, or timelines were specified.

The White House met with top defense contractors Friday to discuss production challenges with munitions as the U.S. closes out the first week of its joint war on Iran with Israel. BAE Systems, Boeing, Honeywell Aerospace, L3Harris, Lockheed Martin, Northrop Grumman, and RTX attended the meeting, according to the post.

“Expansion began three months prior to the meeting, and Plants and Production of many of these Weapons are already under way. We have a virtually unlimited supply of Medium and Upper Medium Grade Munitions, which we are using, as an example in Iran,” and Venezuela, he continued.

Trump also said the U.S. has “increased orders at these levels,” but offered no more details.

The announcement comes after a week of war in the Middle East launched with U.S.-Israel joint strikes against Iran. Concerns about U.S. weapons stockpiles, the president’s ability to boost them, and long production times for missiles that cost millions of dollars each were raised before the strikes, with increasing fervor as the week went on.

For months, the White House has been pushing defense companies to increase weapons manufacturing. It has secured some commitments to boost production numbers. Lockheed Martin, for example, vowed to increase its output of THAAD and Patriot interceptors. RTX, which Trump previously criticized as a sluggish producer, announced several agreements in February to increase production in coming years AMRAAM, SM-3 Block IB, SM-3 Block IIA, SM-6, and Tomahawk.

When asked for comment on the results of Friday’s White House meeting, an RTX spokesperson pointed to last month’s announcement: “RTX is proud to support the administration’s goals of defending the U.S. and its allies at this critical moment and committed to accelerating the production of five key munitions in accordance with the historic frameworks reached with the War Department last month.”

A Lockheed spokesperson said the company began work months ago on its agreement to quadruple critical munitions production. “We are moving with urgency, and we will deliver.”

A BAE Systems spokesperson called Friday’s White House meeting “very productive” and reaffirmed the company’s commitment to deliver and invest in manufacturing capacity.

A Boeing spokesperson confirmed the company’s attendance but didn’t offer any further details.

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The Pentagon’s investment deals draw congressional scrutiny

Lauren C. Williams — Fri, 06 Mar 2026 09:00:00 -0500

Lawmakers have questions about the Pentagon’s increased keenness to take partial ownership stakes in companies, demanding details from defense officials while they weigh the need for legislation.

Government equity investment adds pressure on companies to “stimulate growth” and production without “pursuing control,” Michael Duffey, the Pentagon’s top weapons buyer, said Wednesday during a House Armed Services Committee hearing on the defense industrial base. “We view equity investment as an important tool—amongst a range of tools—that we can apply to build resilience and reduce fragility within the defense industrial base,” Duffey said.

Those other tools include grants and loans, he said, but taking a financial stake in a company has extra benefits, including encouraging companies to put up more of their own funds. Those taxpayer funds can also be returned, unlike grants, which Duffey called a “sunk” cost.

“It creates a partnership with industry, an opportunity not only for the government to provide capital to lead to the kind of growth that we need, such as in the [L3Harris solid rocket motor] deal, but it also crowds in additional private capital. Part of that deal was for L3 to put their own billions of dollars against what we saw as a very high demand for growth within the solid rocket motor industrial base,” Duffey said.

Earlier this year, the Pentagon announced it would put $1 billion into L3Harris’s solid-rocket-motor business to spur production. L3Harris will spend money alongside the government, Duffey said of the deal. The more “skin in the game” vendors have, he said, the more likely they are to increase production capacity.

“We haven't seen the kind of investment that we need in terms of modernizing manufacturing, developing the workforce. We believe [that] equity investment, in some cases—in many cases—in partnership with additional private capital, creates that incentive for better attention to how those dollars are deployed to expand our industry partners’ capability,” Duffey said.

Additionally, each deal “comes with clear milestones” and timelines to “ensure that investment is stimulating the growth that is required,” Duffey said. “We are looking at this as an economic stake in the company. We are not pursuing control.”

Many of the equity investments the Pentagon has made recently relate to critical minerals production. So far, the second Trump administration has invested $2.3 billion on critical minerals supply chain deals since Jan. 20, 2025, buttressed by the Defense Production Act, Duffey testified.

“The Defense Production Act, DPA, is a key component of this investment strategy. The DPA provides the President with the authority to ensure the availability of industrial resources to meet our national defense requirements,” Duffey said in prepared remarks. “We have recently used DPA authorities to make significant investments in critical sectors. For instance, we awarded $29.9 million in September 2025 to develop a domestic supply of gallium and scandium, and we have also used DPA authorities to invest $36.6 [million] in late 2025 in germanium production and $43.4 [million] in September 2025 to establish domestic capability for antimony trisulfide, addressing two of the most pressing critical mineral shortfalls facing the defense industrial base today.”

Duffey also noted that $149 million in DPA Title III funds have gone to eight entities to expand the solid-rocket-motor industrial base.

But lawmakers in both chambers, and across party lines, questioned exactly how the Pentagon was going to monitor and execute equity investments.

“The department's making significant equity investments in companies to ramp up their capability to manufacture. Not a new concept. It's been around, I think, forever," Rep. John Garamendi, D-Calif., said. "How are you monitoring the use of that investment? And ultimately, what will you, will the department be doing with the equity that it has acquired as a result of those investments?”

In opening remarks, HASC Chairman Mike Rogers, R-Ala., welcomed the Pentagon’s use of new financing tools to strengthen supply chain resilience,” because “the status quo was not working. However, Congress needs clearer answers on when equity investments are the right approach.”

During a Feb. 24 hearing on critical minerals supply chains, Senate Armed Services Committee Chairman Roger Wicker, R-Mississippi, praised the Pentagon’s “use of innovative financial tools,” but noted that “little law currently exists” with respect to equity investments.

“I believe these equity-based investments make good strategic sense in many cases, particularly where no free market exists and where we've seen aggressive Chinese economic warfare. However, opinions range [widely] between and within our two political parties,” Wicker said in February, adding the committees have been mulling legislation on the matter.

“While not public, Ranking Member Reed and I had a long series of discussions with our House counterparts, last year, about legislation regarding equity investments. I anticipate that conversation will continue in earnest this year. This legislation is both important and urgent because rebuilding America's critical mineral supply chains will take more than a decade.”

In that same hearing, Sen. Jack Reed, D-R.I., said the Defense Production Act doesn’t explicitly name equity investments.

“I have questions about the legal basis, financial terms and strategic rationale for these transactions. The legal basis, in particular, appears questionable,” Reed said. “The department has argued that the Defense Production Act provides the authority for these investments. However, while the Defense Production Act does authorize the purchase of industrial resources for government use, it does not mention equity investments at all. The fact that the Trump administration's Office of Management and Budget has subsequently requested a legislative proposal to explicitly authorize equity investment suggests that the administration, itself, recognizes the current authority is uncertain. And that should give us pause.”

Michael Cadenazzi, the Pentagon’s head of industrial base policy, fielded those questions and others, saying the deals are designed to provide “performance outcomes” for companies and that equity stakes will be used as an “alternative to other financing mechanisms,” such as direct grants.

Equity investments prove the department’s commitment to “solving these problems, which are outsized relative to our normal focus on it” and “equity is a necessary tool for us to make that commitment,” he said.

“Our goal is not economic returns. We're not trying to excise long-term ownership of these companies. The goal is not to have a stake forever. The goal is to achieve our outcome, execute some sort of exit strategy as appropriate to the moment, and then continue on with the next set of problems,” Cadenazzi said. “Ideally, we wouldn't be spending much time on minerals.

We feel compelled to do so as a result of the situation in the market.”

Duffey and Cadenazzi left their hearings with a little homework at lawmakers’ request: submit details of the equity deals and legal justifications, respectively.

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Defense Business Brief: Shrinking stockpiles + Epic Fury; and an exclusive look at how AI can up UUV’s game

Lauren C. Williams — Thu, 05 Mar 2026 13:09:14 -0500

Will the joint war on Iran with Israel compromise the United States’ already taxed missile stockpile, challenged by sluggish production? The question is on the minds of many in the defense space.

“The stockpiles are not going to be replenished anytime soon,” said Jerry McGinn, who leads industrial base policy at the Center for Strategic and International Studies. “We were talking about this three years ago, in the early days of Ukraine, like ‘we're running out of missiles. How do we do this?’ Obviously, we haven't fixed the situation.”

The only way to change that is to make more. But it takes years to make these exquisite weapons that are being fired in high quantities in a conflict that has no clear end date. So the Trump administration’s push for defense contractors to make weapons faster is gaining more urgency.

On Tuesday, President Donald Trump warned defense companies they were under “emergency orders” to build weapons faster.

Is there policy or legislation that could help, like the Defense Production Act? Not for such a long standing problem, but the Pentagon could do more with multiyear procurements, such as the recent Lockheed Martin announcement for Patriot missiles, for other munitions, McGinn said.

But there may just never be enough inventory.

“I'm starting to come to the conclusion that we're just never going to have enough precision-guided munitions. There's such a huge demand for them in conflict that I just think there's probably no stockpile big enough, to be honest,” he said.

Ultimately, the U.S. has to figure out how to build missiles that are easier to produce and scale as part of “a mix of really exquisite munitions and then some that are more expendable,” McGinn said. “But we're just…we're not there right now.”

Still, heightened attention on the matter from the White House and Pentagon could prove positive, said Jim Segelstrom, who leads the National Defense Industrial Association’s manufacturing division.

“There's an incredible focus on surge. We're engaged with the J4, they have surge efforts going on. There's now the Wartime Production Unit, which is all focused on surge. There's the Joint Production Accelerator Cell focused on surge,” said Segelstrom, CEO of defense contractor McNally Industries. “I think that degree of attention will only produce positive outcomes.”

And missiles aren’t the only stockpiles to consider: drones carry their own challenges.

“This conflict reinforces a few themes: quantity carries strategic weight, software and autonomy drive advantage, and industrial capacity is decisive,” said Brett Velicovich, a former special operator and intelligence analyst who helped launch Powerus, which produces autonomous systems and software for the military. “The side that can iterate faster and sustain inventory under pressure will shape the operational tempo.”

Welcome

You’ve reached the Defense Business Brief, where we dig into what the Pentagon buys, who they’re buying from, and why. Send along your tips, feedback, and best long-run song recs to lwilliams@defenseone.com. Check out the Defense Business Brief archive here, and tell your friends to subscribe!

China, subsea drones and the need for rapid testing. A Congressional review board gathered this week to talk about China’s threat undersea and the need for unmanned underwater vessels. What wasn’t discussed is how retrieving UUVs’ data quickly when coming back from sea trials can be a challenge.

An “analysis that used to take, after each test, around four hours to produce, we've gotten down to around 15 minutes,” Nominal CEO Cameron McCord told Defense One in an exclusive interview.

Nominal is teaming up with major military shipbuilder HII to make that timeline the norm for their fleet of unmanned underwater vessels, called Remus. UUVs can be used to launch drones and weapons, hunt mines, perform surveillance and reconnaissance missions, and map terrain.

McCord said the platform allows engineers to remotely track whether a system is hitting desired targets, and thus collecting the right data. The manual process often relies on assuming data collection was correct and usable, which can’t be verified until the system returns.

The metrics? HII expects to speed up its testing cycle by 75 percent, which could lead to faster system upgrades and deployments, said Eric Chewning, HII’s maritime systems and corporate strategy lead.

“If the testing time collapses, then we're able to generate a next-generation capability that much faster,” for example, he said of Remus.

The plan: Use Nominal’s software on the existing Remus fleet: 750 delivered and those under development, as well as on the still-under-development Romulus unmanned surface vessel. But there’s also potential to apply the software “outside of the unmanned business,” Chewning told Defense One.

Going deeper: The announcement comes as UUV production is expected to grow with a little help—about $1.3 billion—from last year’s budget reconciliation bill, and as concern grows around military competition underwater, particularly with respect to China.

“We are working on a family of systems, everything from what we call extra-large unmanned undersea vehicles—think like big payload trucks for things like mine warfare or other other payloads—as well as large diameter torpedo tube launch-and-recovery,” Vice Adm. Richard Seif, who leads Naval Submarine Forces, testified Monday before the U.S.-China Economic and Security Review Commission. “So the more we can invest and move out at scale, it will be critically important in the future.”

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The Army just launched an open call for industry ideas

Meghann Myers — Tue, 03 Mar 2026 17:20:34 -0500

The Army is looking to stretch its limited research and development dollars by teaming up with private industry to develop projects that can be used by the service as well as commercial customers.

A request for information that went live Friday kicked off what the service is calling its Strategic Capital Initiative, seeking out private sector ideas for new operating models, public-private partnerships and contracting methods that can combine Army funding with private capital investment to tackle what the service estimates is a $150 billion backlog of needed infrastructure updates.

“The ask to industry is: Help us solve our problems. But in a way where they can get return on their investment that is not reliant solely on the Army as a customer, because then you ultimately come back to the appropriated funds issue,” Dave Fitzgerald, the Army’s chief operating officer, told reporters Tuesday.

Rather than figure out what it wants and then put out specific requests, the Army has a list of areas it wants to work on to help direct some of the pitches. They are:

Energy resilience and dominance
The organic industrial base
Strengthening logistics and supply chains
Real assets and facilities utilization
Advanced and flexible manufacturing and technology adoption
Critical minerals and research development

“What we're trying to do is let them see what we think we need across our entire footprint, and they may be able to come up with a model that kind of bundles some of that, or networks some of those things together in a way that we just haven't arrived at yet,” Fitzgerald said.

The Army has been trying to save money by using commercial parts in some of its programs, including the infantry squad vehicle, which is built off of the Chevy Colorado pick-up truck’s chassis and makes use of that existing commercial production line.

Now the service is looking for more of those types of partnerships, Fitzgerald said, where a contractor can put up much of the initial investment and then be able to sell the final product commercially as well as to the Army.

“So we're looking for models that present a diversified customer base, because I think that de-risks it for the taxpayer as well as it de-risks the investment for industry,” he said. “Certainly, we are looking to de-risk the initial investment, either by becoming a long-term partner through a co-investment model, or signing up as an anchor customer for things that we know that we need, that align to one of these six areas.”

This includes investing in securing supply chains for resources like rare-earth metals, which the Army needs in order to build things like brushless motors for unmanned aerial systems, but that have wide commercial use as well. The Army and a private investor could team up to source them.

“Heavy rare earths that go into small drones, but they also go into the motors that make your car window go up,” he said. “So that's, I think, how we kind of unlock the dual-use potential.”

The idea is that the Army can save some of its investment funds with these public-private partnerships, then use its appropriations for must-do projects that don’t have a commercial purpose, like building bigger hangars for its forthcoming MV-75 tiltrotor aircraft.

“I know for a fact that we're never going to be able to dig out of our current infrastructure backlog without a different approach,” Fitzgerald said. “I think how much remains to be seen. But I am optimistic.”

The RFI is open until April 2. From there, the goal is to review proposals and get to work on the best ones right away.

“I think we want shovels in the ground by summer,” Fitzgerald said. “I don't know what that looks like, if it's a [letter of intent] signed, if it's an actual shovel going in the ground—it's going to be different.”

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Pentagon’s war on Anthropic based on ‘dubious’ legal thinking and ideology—not real risk, sources say

Patrick Tucker — Tue, 03 Mar 2026 16:18:57 -0500

The Pentagon’s Friday move to label Anthropic’s AI models a “supply-chain risk” likely won’t stand up in court and could result in a wave of expensive legal judgments, according to legal experts and officials who spoke with Defense One. They described the move as legally “dubious.” A defense official who manages information security called the designation “ideological” rather than an accurate description of risk.

Quick recap: Last week, after AI company Anthropic and the Department of Defense failed to reach an agreement on AI safety standards, Defense Secretary Pete Hegseth said on X that he was “directing the Department of War to designate Anthropic a Supply-Chain Risk to National Security” and that, “Effective immediately, no contractor, supplier, or partner that does business with the United States military may conduct any commercial activity with Anthropic.” Hegseth’s comments followed President Trump’s social post directing all federal agencies to stop using Anthropic. Many have already stopped using its software.

Hegseth also said in his post that Anthropic will continue to provide services to the Defense Department for six months, “to allow for a seamless transition” to another frontier AI model.

But no one knows if the statement will result in an actual, legal designation or if it was just a negotiating tactic.

“We have not yet received direct communication from the Department of War or the White House on the status of our negotiations,” Anthropic said in its own statement Friday.

The move to bar virtually any company that works with the Defense Department from also working with Anthropic could have devastating effects for the AI firm. Adam Conner, the vice president for technology policy at The Center for American Progress, wrote on X that Anthropic relies on large-scale cloud computing providers like Amazon Web Services to train models and host services.

“It’s the equivalent of the death penalty for Claude since AWS and Google Cloud could no longer host Anthropic,” Conner said.

And the penalty doesn’t fit the alleged crime, several sources told Defense One.

The Pentagon’s stance is that allowing private companies to dictate terms of use for their products to the Pentagon could create risks or delays for soldiers during operations.

However, a defense official told Defense One that elements of U.S. Central Command used Anthropic, among other AI tools, as part of Operation Epic Fury. The official said the military had already spent hundreds of hours training the model and did so under rigorous human oversight. While they emphasized that CENTCOM has many AI tools and the move will not impact operations, they noted that the idea that it would be quick or easy to replace Anthropic’s model with one from another frontier AI company does not reflect reality.

“If a command trained more off of Claude than OpenAI’s ChatGPT, for example, putting combat data against a particular model, that model is going to outperform another provider just because you've trained on it for however long,” the official said.

Hegseth’s statement suggests the supply-chain risk designation stems from the belief that “Anthropic’s stance is fundamentally incompatible with American principles,” rather than a failure of the model to operate as designed, leaked intelligence, or technical vulnerability.

Anthony Kuhn, a managing partner at the New York law firm Tully Rinckey, told Defense One that designation, accompanied by the threat against Anthropic’s corporate and commercial partners, could expose the Pentagon to lawsuits—not only from the company, but also from the defense contractors it is threatening—if the Pentagon cannot prove the risk is real.

That’s because the definition of what constitutes a supply-chain risk is not up to the administration, Kuhn said, it is a matter of law: specifically Title 10, Section 3252. “It deals with any type of potential sabotage or maybe creating a back door in an IT system, or any of those risks. And in this situation, he's not expressing a risk. In fact, they're going to continue using the organization’s software for the next six months,” Kuhn said. Furthermore, Kuhn noted that under that law, Hegseth would not have the authority to bar private companies from working with one another.

Another defense official who specifically evaluates supply-chain and other potential intelligence threats told Defense One “there is no evidence of supply-chain risk” from Anthropic’s model. The official called the designation “ideologically driven.”

And defense contractors that obey the administration’s demand and cut ties with the company could open themselves to lawsuits, Kuhn said, despite not issuing the ban themselves. While such a scenario would depend on venue, jurisdiction, and other factors, there exists a legal doctrine called joint and several liability which “imposes on each wrongdoer the responsibility for the entire damages awarded, even though a particular wrongdoer’s conduct may have caused only a portion of the loss,” according to a 2019 Supreme Court opinion.

If Anthropic were to take that route, Kuhn said, “They would likely file suit against everybody who's involved and just get their money one way or another, and then leave it up to everyone to fight about who owed them the money.”

Anthropic has vowed to challenge the designation in court, should it become official, but did not comment on specific legal action the company might take.

The situation represents a significant escalation of what is essentially a philosophical disagreement. The “stance” in question relates to Anthropic’s preferred safeguards for the use of AI—safeguards that prohibit the use of the model for hypothetical autonomous weapons and mass surveillance of the U.S. population. These are two use cases that “have never been included in our contracts with the Department of Defense,” and “we believe they should not be included now,” the company said in a Feb. 26 statement.

The apparent move to damage the company rather than simply walk away is already chilling relations between the Pentagon and the technology firms it is trying to attract, Jessica Tillipman, an associate dean at George Washington University Law School, told Defense One.

“If the government just thinks it's going to keep trying these outlandish legal theories as a means to inflict maximum damage... I don't know how any company makes a major move right now, given this," Tillipman said. "Everyone looks at this and goes, ‘This is so legally dubious.’”

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Defense Business Brief: OBBB funding; Counterdrone manufacturing; and a CCA update

Lauren C. Williams — Wed, 25 Feb 2026 13:00:00 -0500

Midterm elections are around the corner and more than $150 billion in reconciliation funds are burning a hole in the Pentagon’s pocket.

The department wants to allocate as much of the money in the One Big Beautiful Bill as possible by Sept. 30, even though the funds are authorized to be used through Sept. 30, 2029. The plan is detailed in an 85-document submitted to Congress and obtained by Defense One.

Why the rush? “The administration is pushing organizations to allocate the money to specific programs and obligate it through signed contracts as quickly as possible” in part because “getting the money obligated protects it politically. Otherwise, a future Democratic Congress could try to rescind the money by arguing that DOD can't spend it,” said Mark Cancian, senior adviser with the Center for Strategic and International Studies.

The document says the Pentagon “is working to accelerate execution into FY 2026 if that can be done without sacrificing effectiveness” and “has developed an allocation plan” for $1 billion in Defense Production Act appropriations, “which brings the total mandatory allocation plan total to $153.3 billion across 261 individual subsections which are described herein.”

The funding plan includes $5 billion for critical minerals supply chain investments—$3 billion in 2026 and $2 billion in 2027 to the industrial base fund. There’s also $688 million allocated for the development and production of long-range cruise missiles across the services, with funds expected to award as early as Q2. About $198 million of that will be for 73 Maritime Strike Tomahawk kits: “Funds will award Q4 of FY 2026,” the document states.

The plan, if fulfilled, could mean more contracts in the near-term with focus on production-heavy sectors.

"We're still reviewing the plan in full, but at first glance we're encouraged by the emphasis on key priorities like industrial base modernization, shipbuilding, and munitions," said Margaret Boatner, the Aerospace Industries Association’s vice president of national security policy.

But there’s still the underlying problem of erratic government funding.

“One thing that the president and industry representatives often complain about is the unpredictability of demand for defense purchases,” said Greg Williams, who leads the Center for Defense Information at the Project On Government Oversight. “They say that makes things more expensive, and it provides a disincentive to invest in production capacity. In this case, we are exacerbating that problem by not having a predictable schedule for these expenditures.”

Analysts agree that large influxes in defense funding could prove tricky, especially in areas where production capacity has lagged, such as munitions and shipbuilding. Plus, the Pentagon has failed to pass financial audits and has struggled with a laggard acquisitions system that it is in the midst of an overhaul.

“Increasing their annual budget by $150 billion further strained that system that obviously wasn't working well. And if the president succeeds in getting an additional $500 billion this year, that will only accelerate that strain,” Williams said.

Welcome

You’ve reached the Defense Business Brief, where we dig into what the Pentagon buys, who they’re buying from, and why. Send along your tips, feedback, and rooftop recommendations to lwilliams@defenseone.com. Check out the Defense Business Brief archive here, and tell your friends and foes to subscribe!

Making room for the cUAS boom. Austin, Texas-based Allen Control Systems, which builds robotic turrets to shoot down drones, plans to triple its manufacturing capacity for its keystone Bullfrog system, Defense One has learned. The company’s systems were recently tested by the Army and the expansion to 57,000 square feet is expected to help increase production and testing and accelerate deliveries. The company also plans to triple its workforce, hiring in engineering and technical roles to speed up systems development, testing, and delivery.

Background: There’s a high demand for counterdrone tech in both the military and homeland defense sectors, such as for the 2026 FIFA World Cup. And expanding manufacturing of the tech in the U.S. dovetails with the Trump administration’s domestic manufacturing push, asking defense companies to invest more in infrastructure to make weapons faster.

An aside: The topic came up in Defense Secretary Pete Hegseth’s “Arsenal of Freedom” speeches at True Anomaly and Sierra Space this week.
“I hear it from President Trump almost every time we talk. He's like, ‘Are you getting those guys to go faster? Faster, Pete!’ I mean, I hear it in my sleep,” he said jokingly, impersonating Trump’s voice and cadence. “He believes in American manufacturing and America first and American strength. And we're going to do that with these—we're going to do that with interceptors. We're going to do that with Golden Dome. We're going to do that with the way we invest from subsea to space.”

CCA updates. Northrop Grumman officially named its collaborative combat aircraft offering for the Air Force—YFQ-48A—Talon Blue. The autonomous wingman is part of the company’s Project Talon aircraft portfolio, which focuses on modular, low-cost aircraft and software, the company said in a statement.

Other contenders for the Air Force’s CCA program also released new names: General Atomics’ YFQ-42 CCA is called “Dark Merlin”, a nod to the King Arthur legend and character; while Anduril’s YFQ-44 CCA, Fury, reclaims the aircraft’s original name under Blue Force Technologies before it was acquired.
The Air Force also awarded Honeywell and Kratos-GE Aerospace prototype design contracts to make low-cost engines for the robot aircraft.

A little more: The Air Force has started test flying Anduril’s CCA with weapons. “We are following the same detailed approach used in every other aircraft developmental test program to validate structural performance, flight characteristics, and safe separation,” Gen. Kenneth Wilsbach, the Air Force chief of staff, said in a statement. “This ensures the CCA can safely integrate inert weapons before future employment.”

BONUS: Payloads > launchers. The Space Force doesn’t need another rocket company in the mix, Maj. Gen. Stephen Purdy, who recently led the service’s acquisitions, told a group of investors and space company executives at a conference in Dallas last week that Ars Technica reported.

“We’re on path for mass-produced launch,” said Purdy, who is now a senior advisor to the Air Force Secretary on space acquisitions. “We have got our ranges situated so we can do mass-produced launch. We’ve got our data centers and our data structure for mass production. We’ve got AI pieces that are mass-produced, satellite buses are nearly there, and our payloads are the last element. Payloads at mass-produced affordability, at scale, is the key element.”

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Several trends are shifting defense tech toward Europe

Patrick Tucker — Wed, 25 Feb 2026 00:30:12 -0500

Donald Trump’s break with the liberal democracies of Europe couldn’t have come at a worse time for U.S. defense and tech giants, whose market dominance will be challenged by European competitors riding several favorable trends.

One is geographic: EU policies now coming into force mean U.S. firms will have to alter their strategies and practices—or lose access to a critical market. On the military side, the role of Ukraine in military technology innovation benefits European partners that are closer to the front line. Another is technological: At a time when faster tech cycles and open-source software make it easier for startups to challenge the giants, venture capital is flowing to European defense firms and a few U.S. startups. Yet another is, perhaps, philosophical: Europe is souring on the 21st-century bargain in which U.S. tech services are purchased, in part, with access to European data.

All this suggests that while Europe will find it difficult to uncouple quickly or entirely from the U.S. defense and tech industries, a new order is coming.

No divorce yet

Even as European policymakers elevate concepts like digital sovereignty and strategic autonomy from interesting discussions to formal goals, decades of dependence on the U.S. military and industry are not so easily undone.

U.S. defense firms account for nearly half of global sales, while European companies account for just under one-quarter, according to a Feb. 12 report from the McKinsey consulting firm. Europe buys about half of its defense goods from U.S. firms, a proportion that has grown in the past five years, the report says. And European governments are completely dependent on U.S. suppliers for some key capabilities such as large satellite constellations for internet connectivity or earth imaging.

As NATO Secretary General Mark Rutte, who has referred to Trump as "Daddy," told alliance members earlier this month, “Europe can defend itself without the US? Keep on dreaming. You can't.”

The biggest hole in Europe’s plans for technological independence may be the cloud. Distributed large-scale data storage and retrieval are all but essential for modern weapons, defense manufacturing, societal resilience, and military operations; they are vital for autonomous systems and tools that use generative AI and large language models.

Some 80 percent of European spending on cloud services goes to U.S. companies, according to a December report by the European Commission. Even European officials concede that they have no near-term alternatives to U.S. enterprise cloud and data integration companies. But European governments who worry about their dependence on U.S. tech are openly rethinking their relationships with companies like Microsoft, Palantir and others.

"There is no quick fix," an analyst with a leading U.S. consulting firm told Defense One. “Given the annual capital and operating spend of hundreds of billions over multiple years from the hyperscalers”—the U.S. giants of computing—“we are not yet seeing a comparable European alternative.”

While that’s the picture today, it’s not a permanent one.

Regulation

U.S. executives love to point to EU regulations that hurt European competitiveness—for example, the General Data Protection Regulation. But a pair of new laws aim to help European digital-services companies grow—and will require U.S. firms to adapt.

The Digital Networks Act will replace multiple regulatory schemes with a single one, enabling companies to expand more quickly throughout the EU. The 2024 Data Act, now coming into force, gives users ownership over device-generated data and makes it easier for Europeans to switch cloud providers.

U.S. cloud providers that want to stay in the European market must create EU-based, or at least EU-compliant, versions of their products. These “sovereign clouds” must run on and store data in centers on the European continent. Microsoft, AWS, and Google, for example, have worked with France’s Capgemini to do so, but it eats into U.S. companies’ bottom lines.

Cloud providers must also obey laws that prohibit unapproved sharing of EU-based data with, say, the U.S. government. The laws have teeth; in December, the EC hit X with a €120 million fine for DSA violations. But U.S. tech firms have also been threatened by the Trump administration if they comply.

And at least one analyst believes the DSA will force U.S. companies to open up their ecosystems and share intellectual property with European competitors. In October, AEI fellow Shane Tews argued that this will lead to “race to the bottom where copying existing features becomes more appealing than innovation.”

Ukraine the pioneer

Military tech is also becoming more European—specifically, Ukrainian. U.S. military commanders are closely watching as Ukrainian forces develop tactics and gear that have held Russian invaders at bay—and even defeated a simulated NATO mechanized attack. Last year, Gen. Alexus Grynkewich, the U.S. Air Force officer who is the alliance’s Supreme Allied Commander, urged U.S. companies to workshop their arms and gear on Ukrainian battlefields.

Eric Brock is a co-founder of the venture capital firm Ondas, which backs startups that work closely with Ukrainian troops. He said European governments increasingly want to buy made-in-Europe products. U.S. companies could approach this by seeking joint ventures with European firms—but he said that will require a humbler, more collaborative approach than U.S. companies have been used to.

“We…want to bring European capital as well to match ours. So it can't be the bigger, American company coming in and dictating,” he said. “I think it's going to be hard for the established defense manufacturers who are so embedded with the Department of War to localize in Europe. Some of the emerging players on the fast cycle, like the companies we are working with, will have an easier time.”

Europe’s defense firms have typically moved more slowly than their American counterparts. One way to measure this is backlog-to-revenue, the time between taking an order and delivering a product. It’s an average of 3.7 years in Europe and 2.4 in the United States.

But Ukraine is showing the rest of Europe how to move more quickly. It has, for example, developed and mass-produced interceptor drones while the United States has struggled to deploy far fewer at far greater cost.

That ambition is proving contagious. On Feb. 2, Germany unveiled a new highly maneuverable hypersonic missile in a fraction of the time and cost it took U.S. firms to debut theirs.

New-tech spending

Europe is also putting a large portion of its new defense spending into new technology, rather than updating older tech. From 2022 to 2025, European defense-tech spending rose thirteenfold while U.S. spending on new tech only doubled, according to Jonathan Dimson, a senior partner at McKinsey, who added that investment in European defense-tech startups from 2021-2024 was more than five times greater than in the previous three-year period.

Europe has also noted how Ukraine’s use of open-source software has sped innovation, and the EU has explicit efforts to encourage its use. Google last week criticized the plan as anti-innovation, but investors who bet on open-source AI companies say they can out-iterate closed models. They point to China’s DeepSeek and Arcee AI, a U.S. company that in January released Trinity, a 400-billion-parameter open-source model. Arcee built the model for $20 million, a fraction of the amount that, say, Meta spent on Llama, co-founder Mark McQuade said at an January event in San Francisco.

“You're gonna have so many people building on top of that,” said William Sherman, whose AIN Ventures backs Arcee, “that those you already see those models getting are, like Mark said, getting close to as good as the closed-source models.”

The U.S. military is also pushing for open architectures and freer data sharing, often over the objections of large incumbent defense contractors.

“I'm very much encouraging any company interested in building that kind of open-source U.S.-based model to do so, and there's companies that are starting to do it,” Emil Michael, the defense undersecretary for research and engineering, told a small group of reporters last week at the AWS Defense Leadership Tech Summit in West Palm Beach.

Public distrust

Europeans’ growing distrust of the United States is dragging down their willingness to use U.S.-made tech. Public sentiment began to drop a year ago, after Vice President JD Vance’s speech at the 2025 Munich conference, said one U.S. financier who works with European and U.S. defense firms.

“The Europeans were aghast...They couldn't believe it. They were very upset. Very quickly. They realized that, okay, you know, ‘We have to be resilient,’” the financier said. “I don't think it's widely appreciated how big of a deal it is.

More recently, a poll by the Munich organizers showed that most European respondents strongly felt that Trump’s policies were bad for their countries. In September, a Pew poll found that 63 percent prefer European-made security technologies, even at a higher cost, because they see Trump’s influence as a security risk. Just weeks ago, a poll conducted by Swiss technology company Proton found that nearly three-quarters of Europeans believe that their countries are too dependent on U.S. technology.

Those changes in perception are especially relevant when it comes to AI, which U.S. hyperscalers are investing most heavily. European and U.S. citizens are increasingly aligned in wanting control over their own data and how AI is used in their lives, the Pew poll found.

Military officials also talk about the control they want from AI and defense contractors in general: control over the data that goes into model reasoning, control of or at least transparency into model processes, control over compute resources. That puts the Pentagon on a collision course with big tech, which wants to retain, or even increase its control over user data, compute infrastructure, and intellectual property.

All of this points to a great shift. Allies and consumers are skeptical of tech companies’ relationship with the White House. A new class of startups is emerging to compete against big tech providers. The Ukrainian model is shaping how every military thinks about the future of building and buying weapons.

Bottom line: While large U.S. tech firms will retain their leadership position for years, they are already becoming more European. And they’ll have to re-invent themselves in other ways if they are going to make the pitch that they can still grow and not just manage a slow decline.

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