Pentagon Plan to Buy Thousands of Drones Faces Looming Snags

Mass production of large and small drones is crucial to the Pentagon’s plan to build big stocks of weapons and ammunition to deter China, which the Defense Department describes as the U.S.’s prime strategic competitor.

U.S. military leaders have lined up to warn of China’s ambitions to absorb Taiwan, perhaps in the next few years. The scale of China’s own military buildup, including thousands of missiles, jets, ships and drones, can only be challenged by the U.S. making more, and soon, say Pentagon leaders.

The Pentagon has proposed two marquee drone concepts. The Replicator program championed by Deputy Defense Secretary Kathleen Hicks would produce a huge fleet of air-, land- and sea-based drones that could be deployed by the thousands. These would swarm to ensure some evade defenses to reach their target or relay information, and be cheap enough to use just once.

The Air Force’s “collaborative combat aircraft" program would fly much bigger autonomous drones alongside the new B-21 bomber and the advanced F-35 jet fighter, working as a wingman and adding dots on an enemy’s radar screen.

Uncrewed aircraft are much cheaper than the U.S.’s premium jet fighters, and pilots take years to train.

“This is about affordable mass," said Gen. Dale White, head of the fighters and advanced aircraft programs at Wright-Patterson Air Force Base in Ohio.

But the Pentagon’s goal must contend with booming demand in the commercial aerospace market that has left a shortage of skilled labor, raw materials and parts such as advanced electronics and fasteners. The Pentagon wants to buy thousands of cheap drones in as little as 18 months, and as many as 2,000 larger uncrewed jets. By contrast, one of its primary drone suppliers, Shield AI, produced 38 of the aircraft last year.

“The intended volumes and variants of Replicator aircraft will require production capacity and flexibility not typically found in the defense industrial base," Oliver Wyman, a consulting firm, said in a recent report.

Supply-chain turmoil

Existing defense programs are already being hit by supply-chain snarls. Boeing has blamed staff and parts shortages for delays on programs such as the jets that will fly as the new Air Force One.

“Industry is having a very hard time meeting targets with fighter jets that have extremely well-established supply chains and contractor bases," said Richard Aboulafia, a supply-chain expert at consultant AeroDynamic Advisory.

To build weapons faster, cheaper and in greater quantities than ever before, the Pentagon is looking beyond the major defense contractors to smaller firms, often backed by venture capital.

Andrew Hunter, the Air Force’s chief weapons buyer, acknowledges the challenge of securing hundreds of the large jet drones in a short period, but said they are being designed for high production, with simpler systems and digital design tools.

“The vendor base is pretty robust today," Hunter said. Contenders include the Valkyrie from Kratos, which got its start making drones for use as shooting targets. Boeing has its Ghost Bat, developed in partnership with Australia.

The Pentagon hasn’t disclosed how much it expects the drones to cost, only that it would be a fraction of the $40 million to $100 million price of crewed aircraft they would support.

Manufacturers are concerned that the Pentagon’s drone program doesn’t involve new money.

“It’s unclear how they get funded, and at what scale," said Richard Jenkins, chief executive of Saildrone, a California-based maker of uncrewed naval drones that can stay at sea for as long as a year. “We don’t have two to three years to make these decisions. You have to start building now."

The Replicator program is on a tight timetable, given the scale of manufacturing required to produce thousands of drones.

Just outside Dallas, Shield AI has built a factory to produce small drones that have already been used by the U.S. military.

The San Diego-based company was one of the early entrants to the business of making autonomous flying vehicles that rely on artificial intelligence to navigate and complete missions, and one of the best-funded.

Brandon Tseng, co-founder and president, said the company aims to boost output to 100 drones this year, ultimately seeking annual production of 1,000 over the next several years.

Looking to Tesla

Tseng said the Pentagon’s plans for mass production could take solace from the experience of Elon Musk’s Tesla, which increased output to a forecast 1.8 million electric vehicles this year from about 100,000 in 2017.

“Tesla proves it can be done," Tseng said.

White said the Air Force has developed its own plans for low-cost production that can be scaled up and is taking other steps to broaden the pool of potential suppliers. That includes lowering the security classification on some parts of projects so companies don’t require as many workers with top-secret clearances.

The emerging air-taxi makers present another challenge. Roughly a dozen companies are vying to develop propeller-driven vehicles that can take off and land like helicopters, potentially cutting journey times in New York City, Los Angeles and other big urban areas.

Flush with cash from venture capital, stock offerings and military contracts, the sector is moving closer to large-scale production. That places more strain on the pool of skilled workers and stocks of materials.

Joby Aviation, one of the largest air-taxi manufacturers, last week announced plans for a factory in Dayton, Ohio, that would employ as many as 2,000 workers, right on the doorstep of Wright-Patterson Air Force Base.

Write to Doug Cameron at Doug.Cameron@wsj.com