The Pentagon Plans to Fund 20 Companies to Break China's Drone Dominance
It plans to ban one set of Chinese drone parts every quarter while funding American replacements.
The Way I Heard It with Mike Rowe · 502: Chris Power—The Other Hadrian's WallThe Pentagon plans to offer $50 million to each of 20 American drone companies, with $1 billion for the top three, in a bid to rebuild a domestic drone industry, according to Chris Power, who runs defense manufacturer Hadrian.
The effort matters because the United States has no commercial drone base at any scale, just as the Pentagon says it needs millions of drones. In Power's telling, DJI, the Chinese maker behind the quadcopters many Americans gave as Christmas presents, cut prices so American buyers effectively paid for its factory buildup, leaving China "extremely good at producing military drones."
He describes the fix as a two-part problem. The first part is backing several firms, testing them on ranges, and keeping three big winners that can then pay their own suppliers.
The second part is the supply chain. Batteries, printed circuit boards, cameras, and other drone parts are all Chinese. Under the plan, the government will ban one set of Chinese components every quarter and fund American companies to build replacements.
That work would be covered by a $56.3 billion drone budget, which is Power's understanding of what will be available if the president approves it in the next six months. The next thing to watch is whether that money comes through, and which parts ban comes first.
Questions people ask
Why does the military suddenly need millions of drones?
Small, cheap drones have reshaped recent wars, especially in Ukraine, where both sides use them for scouting, guiding artillery, and striking tanks and trenches. They are expendable in a way fighter jets and large missiles are not, so armies burn through thousands per month. That is why the Pentagon wants mass production rather than a small number of exquisite systems.
How dominant is DJI?
DJI, based in Shenzhen, has long held most of the world's commercial drone market, routinely estimated at more than 70 percent in the United States. Its drones are popular with hobbyists, filmmakers, farmers, and police departments because they are capable and inexpensive. Washington has restricted DJI on security grounds, but replacing its hardware at scale remains difficult.
What is hard about making drone parts in America?
Batteries, cameras, motors, and circuit boards depend on supply chains centered in China, with refined materials, tooling, and high volume factories that the United States largely offshored. Rebuilding them means new plants, new suppliers, and enough steady orders to justify the investment. The Pentagon's idea is to create that steady demand with big contracts and force the shift with phased import bans.