In a major move to bolster domestic defense manufacturing, the Office of Strategic Capital announced a conditional loan commitment of up to $820 million to Performance Drone Works (PDW). The strategic funding, combined with co-invested private capital, aims to establish high-volume domestic manufacturing capacity for essential components across the broader U.S. unmanned systems industrial base.
The initiative is designed to address supply-chain vulnerabilities by supplying parts to multiple manufacturers and platforms, specifically targeting Group 1 and Group 2 unmanned aircraft produced by PDW and other domestic contractors.
According to David A. Lorch, Director of the OSC, PDW is one of several component producers receiving loan commitments to advance the objectives of President Trump’s Executive Order 14307, «Unleashing American Drone Dominance». Lorch emphasized that scaling domestic component manufacturing will strengthen supply-chain resilience and benefit producers across the entire ecosystem.
OSC Senior Managing Director James R. Shanahan noted that the transaction directly targets critical bottlenecks in autonomous systems. Shanahan highlighted that crowding in private capital alongside OSC financing enables the construction of substantial new production facilities required to resolve vulnerabilities across the supply chain.
Proceeding to a final financial close will require PDW to complete standard procedural milestones, including passing technical, legal, and financial due diligence requirements.
Emil Michael, Under Secretary of War for Research and Engineering, underscored the strategic necessity of the agreement, stating that realizing Secretary Hegseth’s command for drone dominance relies on building a secure, resilient domestic industrial base capable of delivering lethal systems to American warfighters.
