A Ukrainian drone manufacturer is partnering with an American company to produce drones on American soil.
It fears that if it stays in Ukraine, it will be “eliminated” by Russian attacks or competition.
Ukrainian companies are increasingly setting up factories abroad.
A Ukrainian drone manufacturer worried about being “obsolete” at home is teaming up with an American manufacturer to build weapons on American soil.
General Cherry co-founder Stanislav Hryshyn told Business Insider, “Realistically, staying in Ukraine means staying local and being eliminated within a few years or even months.”
Emerging Ukrainian defense companies like his increasingly see opportunities beyond their own conflict. They argue that staying in Ukraine – where they are in the crosshairs and struggling to survive in a severely saturated market with limited growth potential – could ultimately kill them physically and commercially.
Staying at home risks being outcompeted or destroyed.
First, he said, “We are targeted by our enemies.” Russia regularly attacks Ukraine’s defense production with missiles and drones.
But beyond that, the Ukrainian market is “not the largest market and is very localized,” constrained by the affordability of Ukraine’s limited defense budget. At General Cherry, “We don’t want to remain a local player.”
There is a growing demand for Ukrainian products such as interceptor drones.AP Photo/Efrem Lukatsky
Another concern is that without the presence of an international market, foreign companies may copy Ukrainian innovations and expand production, thereby taking market share that would otherwise belong to Ukrainian companies.
The company is currently working with U.S. manufacturer Wilcox Industries to build first-person view (FPV) and interceptor drones in the U.S., with development led by General Cherry and production at Wilcox’s facility in New Hampshire.
The project is still awaiting formal approval, but the company said Ukraine has supported the move, explaining that it is about “expanding the effective scope” and “promoting Ukrainian technology to the global level.”
Khrysin said he could not comment on whether drones produced through the partnership would go to Ukraine or the United States for security reasons.
“Without a doubt, I think we will bring tremendous value to the U.S. government by combining our Wilcox manufacturing infrastructure and engineering resources with General Cherry’s technology,” James Teetzel, founder and CEO of Wilcox Industries Corp., said in a statement about the partnership. Teetzel’s company makes defense equipment, including fire control systems and laser targeting devices.
General Cherry wants to “integrate into the global defense system, become a global player and play a role at the international level,” Khrisin said. Regarding the company’s growth, “We thought it would actually be a crime if we stayed in Ukraine. We are already big in Ukraine.” But it doesn’t end there.
“In fact, for American companies, they also have to learn a lot from us. We hope this will be a fruitful partnership for both of us,” Khrysin said. NATO alliance officials and industry leaders said Ukraine’s battlefield-driven innovation and rapid production cycles have significant value.
Ukraine’s defense industry is booming, accounting for a growing share of the equipment used by its military and attracting growing interest from allies seeking combat-proven technology.
Foreign countries are interested in Ukrainian battlefield technology and production technology.AP Photo/Evgeniy Maloletka
But there are some restrictions on staying in Ukraine. Businesses prioritized supplying supplies for the war effort, but operating solely within the country limited how much they could produce, hampering not only the business but also wartime production capabilities.
Industry leaders say manufacturers have the ability to produce more than they currently do, but they can’t because Ukraine’s defense budget cannot afford to buy more equipment. They argue that exports will generate revenue to expand production, including for Ukraine’s own military.
Staying in Ukraine also means decentralizing manufacturing and slowing production in response to Russian attacks. Companies sometimes disperse production to nearly a dozen locations, which makes operations safer but also far less efficient.
Ukrainian leaders have been taking steps to expand the range of exports that gear manufacturers can export abroad and the partnerships the industry can forge with other countries, including a deal that would allow allies to obtain some Ukrainian weapons.
Hryshyn said his company chose Wilcox Industries because it is an established manufacturer with proven products. He said that while some startups are very interesting, they have yet to achieve tangible results.
Additionally, he said, “We believe the U.S. market is actually the largest market in the world.”
General Cherry is one of a growing number of Ukrainian companies partnering with NATO companies to produce weapons abroad – reducing the risk of attack while giving Western partners access to Ukrainian technology and experience. Denmark, the leader of the Build with Ukraine initiative, said NATO companies had a lot to learn from Ukrainian companies and was seeking to acquire their technology.
Khrisin said he has seen the need firsthand. In discussions with Western partners, “our experience and expertise are very valuable to them.” He added that the United States was “learning a few things from Ukraine,” including how to work with startups and operate in a more open, flexible defense ecosystem.
