WASHINGTON — The Trump administration is in advanced talks to provide direct federal funding to American drone manufacturers Performance Drone Works and Nero Technologies through the Office of Strategic Capital. The proposed deals could involve both debt and equity stakes, potentially giving the U.S. government ownership shares in the private companies.
The funding would not be used to purchase drones but to help the manufacturers scale up production and reduce costs, according to people familiar with the discussions. The Office of Strategic Capital, which facilitates government investments in critical defense technologies, is leading the negotiations with the two firms.
Performance Drone Works lists Donald Trump Jr. as both a shareholder and a member of its advisory board, raising questions about potential conflicts of interest given the involvement of the Trump administration in authorizing the funding. Nero Technologies has no known ties to Trump family members.
The initiative aligns with a broader Pentagon plan announced this year to mass-produce 300,000 low-cost attack drones by the end of 2027. Current U.S. manufacturing capacity stands at approximately 100,000 drones per year, far short of the target. Reaching the goal would require investment in domestic supply chains for batteries, motors, and other key components, particularly to reduce reliance on Chinese-sourced materials.
Prior to Trump’s second term, the Pentagon accounted for less than 2% of all drone sales in the U.S., according to a branch of the Defense Department. The shift toward large-scale military procurement marks a change in the government’s role in the commercial drone sector. Ukraine, by contrast, manufactured four million drones in 2025, according to The Wall Street Journal.