U.S. Firms Turn to Ukraine for Drone Technology

U.S. Firms Turn to Ukraine for Drone Technology Following Ukraine's spectacular success in using drones against Russia, several American firms are courting Ukrainian companies to advance their own drone technology, reports The Wall Street Journal. 

American drone startups have struggled to deliver cost-effective, reliable aircraft for military use. In contrast, Ukrainian firms have mastered mass drone production despite limited resources. This partnership is drawing the attention of the U.S. Department of Defense, which is seeking more advanced solutions for future conflicts.

Last year, Southern California startup CX2 partnered with Ukrainian manufacturers to integrate its software and sensors into Ukrainian drones. The agreement, approved by a U.S. military unit, may soon be used by U.S. troops. Nathan Mintz, co-founder of CX2, said no American company could match Ukraine's ability to produce reliable, battle-tested drones.

Skyfall, a company producing thousands of drones daily, has completed over 1.5 million missions for Ukraine. Its bomber drones, equipped with software and sensors from CX2.

The U.S. Department of Defense estimates domestic production capacity at 100,000 drones annually. In 2023, Ukraine produced over two million drones, including long-range strike drones capable of carrying explosives over hundreds of kilometers.

Ukrainian startups aim to enter global markets, focusing on attracting American customers and investors to drive post-war economic growth.

"Ukraine has made it clear that they intend on being the drone capital of the planet once this war is over," said Derek Whitley, co-founder of startup Vivum, which sells its AI software for autonomous systems to the Defense Department. According to Derek Whitley, co-founder of Vivum, Ukraine intends to become the "drone capital of the world" after the conflict. Ukrainian drones, which are significantly cheaper than U.S. models, have shown resilience under electronic interference. In contrast, U.S. drones are slower to develop and often struggle in electronic warfare environments.

The Defense Innovation Unit (DIU) has recently awarded contracts to two Ukrainian-American partnerships to test long-range strike drones in Ukraine.

Additionally, KEF Robotics and Ukraine’s Sensorama Lab have formed a joint venture called Blue Arrow to develop drone navigation systems in Kyiv. Blue Arrow has secured European military orders and is seeking U.S. venture capital while preparing for frontline tests with an elite Ukrainian unit.

Olha Pohoda, co-founder of Blue Arrow, emphasizes that U.S. firms cannot match Ukraine’s drone production capabilities. Colonel Vadym Sukharevskyi of the Ukrainian Armed Forces suggests that NATO forces are not yet equipped to handle modern drone warfare.

Ukrainian President Volodymyr Zelenskyy announced last year that the government was considering exporting weapons to countries that supplied arms to Ukraine, but drone export restrictions remain a major obstacle. Ukrainian drone producers are lobbying Kyiv to lift the ban and working with U.S. partners to find alternatives. Skyfall is seeking special permission to sell its bomber drones to the U.S.

"The parts we cannot sell to Ukraine because they lack funds, we can sell to the Americans or Europeans or Baltic countries," The Wall Street Journal quoted Elena Dushenok, head of growth at Skyfall, as saying.

Ukrainian manufacturers also rely on Chinese parts and must find new suppliers to sell to the U.S. Department of Defense.