The Department of Defense just announced its intention to field thousands of attritable, autonomous systems within the next two years in a program called “Replicator”. The CEO of Utah-based Teal Drones says the plan may break some things but will fix others.
On Monday, Deputy Defense Secretary Kathleen Hicks explained that Replicator is intended to catalyze production and fielding of small drones on a rapid timeline, allowing DoD, “to leverage platforms that are small, smart, cheap and many,” in its effort to counter China.
For perspective, the Pentagon estimates that it currently operates around 11,000 drones in support of domestic training events and overseas contingency missions. Oversight of Replicator will come from Vice Chairman of the Joint Chiefs of Staff Adm. Christopher Grady, participation from the Pentagon’s Defense Innovation Unit (DIU), and Ms. Hicks.
She gave few details about how DoD will go about this – which vendors it will select for which types of small UAS (sUAS), at what cost and what defines “attritable” – but we do know that new funding for the program isn’t truly there yet.
Replicator basically reprograms existing funding. Defense News noted that the $1 billion that House appropriators carved out for establishing a DIU-managed hedge portfolio in their fiscal 2025 defense spending bill and the $1.8 billion that the Pentagon requested for artificial intelligence related projects for fiscal 2024 would be pulled together for the new program.
As Hicks’ spokesman, Eric Pahon, told Defense News, “It’s a reorganization of largely existing funds, and expected to cost in the range of the hundreds of millions.”
Is this potential pool of money enough to get a significant number of sUAS out the door and kickstart U.S. American drone production? George Matus, Teal Drones, CEO says it might be while leaving some room for doubt. “I think this is definitely a transition period. I do think it’s a meaningful direction but it’s by no means the end-all, be-all.”
Teal Drones makes a small military ISR drone called Teal 2 and has just landed a $5.2 million contract to provide 344 copies of its UAS to the Defense Logistics Agency (DLA) which is acquiring the drones for U.S. Air Force Security Forces. The Salt Lake City, Utah-based company is a subsidiary of Red Cat Holdings, a robotic hardware and software integrator for military and private sector clients.
Obviously, the news of a potential boost to American drone manufacturers is welcome for companies like Teal which Matus acknowledges lag behind Chinese makers in terms of output, cost and quality. Chinese maker DJI alone owns 54% of the global commercial market share as of 2022, and 80% of the U.S. market.
“There are people that say that the current domestic offerings in the space are more expensive and potentially less capable than China’s [sUAS]. That’s absolutely true. It’s hard to compete with [Chinese manufacturers] overnight but it is possible.”
It will require expanding the U.S. defense industrial base in broad terms and scaling-up the domestic drone sector more specifically. Teal’s DLA contract will see it produce/provide 344 Teal 2s over about two months according to Matus. Given that Teal’s current production capacity is between 100-200 drones per month in its Salt Lake City factory, a years’ consistent output would be 1,800 drones on average.
That’s only a single low-volume maker. Ten such companies could now theoretically meet Replicator’s goal of fielding “thousands” of sUAS so paying attention to the program details that Ms. Hicks, DoD and its Defense Innovation Unit (DIU) will give is a good gauge of how ambitious (or modest) this effort is.
Given the proper demand signal, Teal can scale Matus emphasizes.
“With our current facility we’re targeting up to 1,000 systems per month. If we’re at 500 per month and we see that we’re going to be going to 1,000, during that period we’re going to expand the facility or acquire a new facility.”
Matus’ comment regarding the possibility of expanding to a new facility reflects the uncertainty of U.S. drone makers, many of whom who have received the Replicator news with tempered optimism judging by numerous reactions on various professional platforms like Linkedin.
Teal’s CEO adds that ramping up won’t happen overnight, bringing Replicator’s 18 to 24 month timeline into question. “We have the process, the recipe to scale but it takes time,” he says. “I think a positive of Replicator is that it will give our industrial base the ability to scale over some period of time.”
Interestingly, it will likely happen without the emphasis on additive manufacturing that has recently come into vogue with drone makers like Firestorm Matus believes.
While additive manufacturing may make sense at the tactical edge, he asserts that Teal can make 5,000 injection-molded airframes in two days with lighter weight and better performance characteristics than additively-made airframes. Integrating the rest of the components for a Teal 2 takes little more time.
“The assembly of the Teal 2 is an order of magnitude easier than a comparable system. Internally, there are no real wires, glue or soldering required. Everything just falls into place and is quick to manufacture.”
Matus’ comments align with those of Kratos Defense unmanned systems division president, Steve Fendley, who told me that additive manufacturing is not yet considered a necessary ingredient in the production of its midsize and larger UAS.
The output that Replicator seeks to generate will depend on cost as well as production capacity – the latter impacted by the broader electronics/sensor/weapons system supply chain. The Teal 2 ranges from $13,000 to $17,000 per unit depending on volume and requirements. The price includes the aircraft, ground station, radios, payload, spares etc.
So $1.7 million would theoretically get DoD 100 Teal 2 drones. For $17 million, it could have 1,000. Such cost will eat into Replicator funding quickly and the numbers here aren’t for a drone with the kind of kinetic effects the Pentagon thinks can deter China. Not surprisingly, Matus affirms that DoD would get a discount for buying in bulk.
“With Replicator as volumes are significantly increased, we see benefits from economies of scale and the ability to further vertically integrate while staying fully modular with open architecture.”
Matus’ point about modularity and open architecture raises a vital issue that Replicator should address. If it sparks large-scale acquisition of sUAS (aerial, land or marine systems), it will beg the question of how the Services will command and control (C2) all these drones in vast places like the Indo-Pacific?
There is currently no common C2 system for sUAS and other drones. A few companies have been pushing for adoption of a single solution including Anduril which is hyping its Mission Autonomy system.
Teal, which has been working with the Army on the possible use of its ISR drone for the Short Range Reconnaissance capability the service is beginning to field, sees the Army’s Robotics and Autonomous Command and Control (RAC2) as a possible standard C2 platform.
George Matus says he does see joint requirements for sUAS C2 being formed and some unity with respect to choosing a single system, “But it’s still an outstanding problem that has to be solved,” he acknowledges.
Can Replicator really go forward effectively before a common C2 solution is adopted? What would that solution cost and would acquisition come from Replicator funding, thereby reducing the tactical mass that the program seeks to obtain/inspire?
It’s debatable Matus observes. “I don’t think that within 18-24 months anyone is saying we’re going to have all these problems solved, be ready for prime time…but from our perspective I think this is a meaningful step forward. It may break a few things along the way, but it will make those things evident and will accelerate fixes.”
Many other questions surround Replicator including whether the assumption that lessons from the Ukraine-Russia war which inspired it will actually translate effectively to China and the Pacific? These range from what is necessary in terms of numbers to whether sUAS’ become akin to smart munitions in a conflict with China, likely to be exhausted within a week as several studies forecast.
Whether small, cheap drones can function effectively across Indo-Pacific distances (even from island to island) is a question as is whether the U.S. military would actually have the bandwidth to control and generate insights from them in time of spectrum-contested war, autonomy notwithstanding?
The Pentagon should shed some light on its thinking with respect to the above and how the answers shape Replicator. Teal’s CEO says that the program can at least be a starting point.
“If you can build a domestic [drone] supply chain and industrial base and produce [SUAS] systems at orders of magnitude higher numbers at orders of magnitude lower cost than traditional guided munitions, it’s still worth looking at.”
But what will come of it in less than two years’ time will bear watching. “I can only directly comment on Teal and our products,” Matus affirms, “and I can say that 18 to 24 months is very realistic to be able to scale up to a meaningful amount of volume.”