Oshkosh enters drone manufacturing via Grid Aero partnership; Leonardo DRS joins Army laser program

Companies mentioned: AeroVironment, Embraer, Greece, Grid Aero, Leonardo DRS, NASA, Oshkosh Defense, Saab, Swedish Navy, U.S. Army

Partnerships & Industrial Strategy

Oshkosh Defense made its most significant strategic pivot in years by partnering with drone startup Grid Aero to scale production of the Lifter aircraft — marking Oshkosh's first entry into aircraft manufacturing. This is a bellwether for how legacy defense vehicle primes are repositioning for the autonomous era. Rather than building UAS capabilities organically, Oshkosh is leveraging its manufacturing infrastructure and defense contracting relationships to bring a startup design to production scale. For Grid Aero, this likely de-risks their path to meaningful Army procurement. For the broader UAS startup ecosystem, this validates the "design it, partner to build it" model — but also means startups without a manufacturing partner may struggle to compete at scale.

Government Contracts & Directed Energy

• Leonardo DRS was tapped to support AeroVironment's E-HEL program for the U.S. Army, a significant directed energy contract. AeroVironment holding the prime position on a high-energy laser program is notable — it reflects how the Army's acquisition community is increasingly comfortable placing non-traditional primes on advanced weapons systems.
• The LOCUST counter-drone laser system's deployment to protect Mar-a-Lago, while not a new contract per se, demonstrates real-world fielding of directed energy C-UAS systems and validates the operational readiness argument that companies like Epirus, Raytheon, and others have been making.

International Defense Sales

• Greece signed for a fleet of Embraer KC-390 tanker/transports, continuing the aircraft's strong run in European markets. The KC-390 is steadily carving market share from the aging C-130 franchise, and each new NATO-aligned customer strengthens Embraer's defense credentials.
• Saab unveiled the CB90 CX — an optionally crewed, larger variant of its proven combat boat — for the Swedish Navy. The optionally crewed capability is the key differentiator here and positions Saab for the growing unmanned surface vessel market across Nordic and allied navies.

What to Watch

• UGV demand signals: An autonomy consortium executive publicly called for more consistent procurement signals to scale UGV production. This mirrors the same challenge the UAS sector faced 3-5 years ago. If the Army can't commit to predictable multi-year buys, UGV startups will struggle to attract the manufacturing investment needed for scale — creating an opening for primes who can absorb the demand uncertainty.
• Directed energy mainstreaming: Between the Leonardo DRS/AeroVironment E-HEL contract and LOCUST deployments at high-profile sites, directed energy is moving from R&D curiosity to operational reality faster than many investors anticipated. Power and thermal management subsystem providers (like Leonardo DRS) may be the safer picks in this space versus full-system integrators.
• European rearmament acceleration: Greece's KC-390 buy and Saab's new combat boat both point to sustained European defense spending growth. Investors should watch for follow-on export orders, particularly from Nordic and Southern European nations expanding post-Ukraine threat postures.

Deals & Contracts

Oshkosh Defense / Grid Aero — Strategic Partnership

Unmanned Systems

Oshkosh Defense's first move into aircraft manufacturing via a partnership with startup Grid Aero to scale production of the Lifter UAS is a significant signal. This is a classic prime-startup teaming play: Oshkosh brings manufacturing scale, supply chain depth, and government relationships while Grid Aero contributes the airframe IP. Investors in the Group 3-5 UAS space should note that legacy vehicle primes are now actively entering the drone production game, which could compress margins for pure-play UAS companies while validating the market.

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Leonardo DRS — Government-backed Funding

General Defense Tech

Leonardo DRS has been selected to support AeroVironment's E-HEL (Enduring High Energy Laser) program for the U.S. Army, deepening the directed energy industrial base. Notably, AeroVironment is the prime contractor, reflecting how mid-tier defense firms are winning prime positions on advanced weapons programs that historically went to the Big Five. Leonardo DRS's power and thermal management expertise makes them a natural subcontractor here — watch for their role to expand as HEL systems scale across services.

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Embraer — Government-backed Funding

General Defense Tech

Greece signing for a KC-390 fleet is another win for Embraer's military transport and tanker program, further establishing the KC-390 as a credible C-130 alternative in NATO-aligned markets. This deal underscores the accelerating European rearmament trend and growing appetite for non-U.S. platforms among NATO allies. For investors, Embraer's defense backlog continues to diversify geographically, reducing dependence on the Brazilian domestic market.

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Saab — Strategic Partnership

Unmanned Systems

Saab's unveiling of the CB90 CX — a larger, optionally crewed evolution of its proven combat boat — for the Swedish Navy signals growing demand for unmanned and optionally manned surface vessels. The CX variant's expanded payload capacity and autonomous capability position it for both Nordic defense and potential allied export markets. Optionally crewed naval platforms remain an underappreciated growth vector relative to the attention aerial drones receive.

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Tags: directed energy, drones, european defense, government contract, strategic partnership, ugv, unmanned systems