Local competition awaits as Western defence firms expand in UAE

Visitors stand at a model of EDGE Advanced Technologies Group’s QX-1 loitering munition “Kamikaze Drone” for defense on display at the UMEX exhibition at the National Exhibition Centre in Abu Dhabi, Gulf Emirate, showcasing drones, robots and Unmanned SystemsFebruary 22, 2022. (Photo by AFP via Getty Images)

BEIRUT — As the Gulf region attracts more attention from eager defense companies around the world, it’s clear that direct competition with local companies can be an elusive mountain to climb. But on the other hand, local partners offer a potentially lucrative way for new clients.

One of the latest Western companies to take action is UAVOS, a US-based drone maker with a Dubai subsidiary, United Arab Emirates August to support the company’s growing regional presence.

In an interview with Breaking Defense, UAVOS board chairman Vadim Tarasov said the company has partnered with local companies and plans to build a research and development center.

“We are doing defense and aircraft-related business with large companies in the UAE and will make a major announcement within the next month,” Tarasoff said in an interview at the end of September.

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Tarasov said his company’s main project is the so-called HAPS or High Altitude Platform Station, a solar-powered stratospheric drone similar to Airbus’ Zephyr droneTarasov said UAVOS’ platform will be jointly produced with an Emirati company, which will be Emirati intellectual property.

Tarasoff did not specify which Emirati company would be the other part of the joint venture, but almost any Western company that wants to enter the UAE market will have to partner with Tawazun or EDGE. EDGE, a large conglomerate of 25 entities, could be a candidate because it has already invested heavily in drones.

The chairman of the UAVOS board told Breaking Defense that the company is also working with “another customer” in the UAE to develop a large MALE UAV (Medium Altitude Long Endurance Unmanned Aerial Vehicle).

When asked about competition with existing local drone projects, Tarasoff said: “We are offering the ability to produce certain types of drones rather than competing directly with existing products. We usually develop and ship The market offers a lot of systems.”

He added that UAVOS has never tried to go head-to-head with local companies, as it is working with local companies to develop new capabilities and components for the next generation of unmanned aircraft.

Regarding the subsidiary, Tarasoff said it is still in the early stages but expects to have 15 employees by the end of 2022. “R&D is one of the areas where we will be scaling up in the near future.”

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Basically, as in many countries, it is easier to work with an existing subsidiary in the country, as the system will look directly and customize accordingly on-site, even for customers outside one country, he added.

Tarasoff added: “The UAE entity is the right move, it brings us closer to our partners in the region of Saudi Arabia, Oman, Qatar, Kuwait and we are targeting all other countries in the region that are not sanctioned .” suggesting that the only red light is for Iran.

Local companies grow themselves as partnerships flourish

UAVOS is not the only company trying to join forces with UAE companies. Sweden-based Saab has launched research and development work on sensor technology in the UAE, among a number of agreements announced during IDEX 2021.

The company has also signed an agreement with the Tawazun Economic Council to strengthen education programmes to maintain and strengthen the emirate of defence and security (SEEDS). The company showcased its first product developed in the United Arab Emirates at the same show, the Rugged Camera Module-Infrared or RCAM-IR, a camera platform that can operate in harsh environments.

Also in 2021, US-based company Quali announced that it will join forces with EDGE subsidiary Beacon Red to provide a cyber training and testing environment for GCC countries.

However, these products will face competition once local companies, especially EDGE subsidiaries, expand on their own. Government deals with local EDGE companies are expected to be favoured over foreign companies as the UAE’s local policies aim to boost local defence production and support indigenous capabilities, unless the latter will offer some local IP options as well as UAE systems and mutual development of programs.

In the area of ​​drones in particular, EDGE told Breaking Defense in a statement that several of its homegrown projects have moved beyond the planning and design stage and have entered the experimental phase.

“EDGE has participated in several drone trials to ensure the system meets the performance requirements of potential customers. The drone’s accuracy, power and guidance capabilities as well as endurance, range and payload are being tested,” the company said. “The systems we developed are being tested in multiple threat environments, and we are pleased to report that they are performing extremely well.”

As for competition from foreign companies such as UAVOS, EDGE said it does not see them as competitors at all, but as “potential collaborators”.

“We will compete in certain categories, but it’s healthy for the industry,” the company said. “Our business model will focus on building collaborative opportunities. We will collaborate with other industry players in our mutual interests to redefine advanced technology synergies, create innovation opportunities, bring agility to adapt, and accelerate time-to-market. “

EDGE officials said the group is investing extensively in key research and development areas and leveraging advanced technology, believing that its drones will eventually operate outside the current market environment – suggesting they are looking at customers far beyond their geographic regions.

“Similarly, we are making extensive use of our test facilities and the natural environment of the region to ensure the performance and reliability of the solution. The region has specific needs in terms of the environment, so our drones are very hot, humid and dusty That said, we are looking to provide global markets with robust solutions for every capability and every threat,” the officials added.

Regarding their major homegrown unmanned systems project, the company updated the Breaking Defense schedule. Most of these have already entered the testing phase, and 2025 will see the mass production of several UAE drones. Here are some updates, according to EDGE:

• HUNTER-2S: The HUNTER 2-S is a tube-launched swarm unmanned aerial system under development, with first flight tests to begin in 2023 and production in 2025.
• QX: Among the QX series drones, the QX-2 has made the most progress. It has participated in several customer trials, reaching the stage of rapid prototyping to continue testing various features. It will go into production in the first quarter of 2023. Trials of QX-1, QX-3 and QX-4 will be conducted at a later stage. The QX-5 and QX-6 are currently in development. QX (1-4) is a kamikaze drone, in which QX-1 is a miniature quadcopter drone; QX-2 is a miniature drone, but the platform is larger, QX-3 is a small drone, Basically four guided munitions can be carried, and the QX-4 is a fixed-wing vertical take-off and landing drone.
• GARMOOSHA: The company said that a vertical take-off drone made by subsidiary ADASI is ready for use. In recent trials, GARMOOSHA has completed multiple operational flights and successfully demonstrated a range of capabilities, including vertical take-off and landing (VTOL) capability with a payload of 100kg over a range of 150km.
• REACH-S: The fixed-wing Armed Medium Altitude Long Endurance (MALE) REACH-S is advancing its development milestone, with test flights scheduled for the first quarter of 2023.

As the product range develops, it sets the stage for intense competition between entirely domestic companies, international partners and oddly direct foreign deals in the years to come.