How not to build a drone
How the EU spent 16 years and €8 billion on a drone that may never fly
Introduction
A few weeks ago, the French Minister of the Armed Forces Sébastien Lecornu confirmed to French parliamentarians that the ‘Eurodrone’ project was set to be delayed by another year. The Eurodrone - the European Medium Altitude Long Endurance Remotely Piloted Aircraft System (MALE RPAS) - is an EU project to create an unmanned combat aerial vehicle that’s been running for over a decade.
Conceived in 2014, following the Russian seizure of Crimea and mounting European concern about the dominance of American, Chinese, and Israeli firms in the drone market - the project has been a fiasco from start to … not finish. It’s been hit by cost overruns, contractual fights, spats between governments, and the final vehicle - if it’s ever delivered - is likely never to see service. In fact, Lecornu has acknowledged that they are only continuing with the programme, because cancellation would be costly. Textbook economic sunk cost fallacy right there.
So far, business as usual in the world of European defense contracting.
But we believe that the Eurodrone project can also teach us some useful lessons, which are increasingly relevant as the nature of war shifts and European governments begin to adjust their defense posture out of last resort.
The Eurodrone: a brief history
In the spring of 2014, Dassault, Airbus, and Alenia submitted a proposal to the French, German, and Italian governments for a study to shape the requirements for the Eurodrone. If actioned speedily, they believed (perhaps optimistically) that a working prototype could be ready for testing in 2020. Given the history of failed European drone projects, the companies wanted the governments to pay for the study.
By the end of 2015, the three governments hadn't given the study the go ahead. This was because they were unable to agree on any basic details among themselves - including the speed, mission profiles, whether it would be armed, how many engines it should have, or who would manufacture it. It would take until September 2016 to finally authorize it.
Why did it take so long to agree on the basics?
While many European governments use similar terminology, when you scratch under the surface, it tends to mean different things. This is particularly the case in anything relating to defense, resilience, or sovereignty.
Back in 2013, the EU began to use the term ‘strategic autonomy’ for the first time in a defense and security setting. In its earliest versions, it acted as a floating signifier - its meaning would depend on which European capital you happened to be in.
For France, ‘strategic autonomy’ was a call-back to the era of Charles De Gaulle, when the country attempted to formulate a defense and security policy that, to some extent, diverged from that of the US. In Berlin, it was read as a statement about the need to maintain wider industrial competitiveness. Italy saw it as building EU capacity to act more in the Mediterranean for security and migration management. Meanwhile, Poland and the Baltic nations, acutely aware of the importance of the US security umbrella, were inclined to view it as posturing.
Unmanned aerial vehicles (UAVs) were relatively new for European governments. While the US had been using Predator drones to strike targets since 2001, except for the UK, European countries well into the 2010s shied away from buying them at any scale.
After being forced to rely on US Predator drones while running their counterinsurgency operation in Mali, the French were keen for a drone that could be armed.
Germany, and the other Eurodrone partner nations, were much more focused on border surveillance. While Germany had begun to dabble in armed UAVs, it was unenthusiastic.
In 2014, after their lease on unarmed Israeli Heron drones expired, the German government purchased a small handful of armed vehicles - only after extensive lobbying by the military and against a political backlash. Even then, the German Armed Forces didn’t want the armed drones to be too lethal. In the words of one insider: “Ideally, we could have a UAV carrying a number of very small bombs – and only a few of them would be fitted with explosives. The other would have no explosive material but would produce only a loud bang or smoke without causing harm.”
It was against this backdrop that the Eurodrone was conceived. Countries agreed there should be a drone, but were unwilling to concede that the drone you use for domestic surveillance is unlikely to be the same one used for fighting extremists in West Africa.
This need to accommodate different countries’ different requests and to divide up the manufacturing across different local suppliers led to years of squabbling and negotiations. This produced a costly and complex design that could accommodate everyone’s different requirements.
For example, to fly in non-segregated civilian airspace, UAVs need to adhere to higher safety and redundancy standards. Regulators need to be confident that in the event of engine failure, the UAV won’t plummet into a population center. Meanwhile, to support strike capabilities, UAVs need higher payload capacity and structural reinforcement.
To tick these boxes and use European components, the final design employed two Catalyst engines, designed by General Electric’s Italian subsidiary, Avio Aero.
This is unusual in the world of UAVs. Military vehicles like the US Predator or Israeli Heron do not usually use two engines, because it’s complicated, expensive, fuel inefficient, and … heavy.
The design and definition were finally agreed in 2019 - a year before the manufacturers had first hoped to start testing prototypes. And it pleased no one. French parliamentarians criticized the “obesity” caused by “German specifications”, with a French Senate report claiming that “with two motors and a weight of 10 tons, this drone will be too heavy, too expensive and therefore, too difficult to export”. The Germans complained about spiraling costs caused by immature technologies and began to recommend including American components.
The drone, if it’s ever delivered, will now arrive after 2030 and at least over 40% over budget. Naturally, contractors in different European countries have fallen out. The preliminary design review was completed in May this year, 10 years after Dassault and Airbus submitted their original proposal.
European governments will have spent approximately €8B for a drone that’s … not really optimized for anything. Given the small handful of orders - this will work out at €120M per drone.
In the 16 years between the conception and earliest completion date of the project, a lot will have changed: the decline of big platforms, the rise of attritable warfare, the use of AI and autonomy to improve accuracy, the ballooning complexity of electronic warfare. None of this will be reflected in the final design.
What can we learn?
We aren’t retelling the story of the Eurodrone so we can laugh at the participants. Instead, it’s a source of some positive lessons on how to procure technology. There are a few that we can identify.
If something works, just buy it
The Eurodrone joins the long list of attempts by national governments to replicate capabilities that others have delivered competently. This is motivated by two differing errors in reasoning.
Firstly, an incoherent vision of sovereignty. While it’s possible to understand the theoretical appeal of truly sovereign technology for defense, it’s rarely realizable.
If the US decided that it was going to cut off support for every piece of military equipment it had sold to European governments, a single ‘autonomous’ drone programme would not be enough to rescue us from the ensuing disaster. It’s the equivalent of semiconductor sovereignty efforts that derisk Chinese disruption to the supply chain by heavily subsidizing the onshore construction of one or two fabs. Expensive? Yes. An actual guarantor of sovereignty? No.
Secondly, this belief that individual countries’ needs are special. Again, it’s true that different militaries’ exact uses for equipment vary. But once you attempt to redesign technology that already works by committee, it pretty quickly stops working. The archetypal example of this is Watchkeeper - the botched British attempt to replicate the highly capable Israeli Hermes 450 drone. 265 user requirements, 1,910 additional system requirement, and £1.4B later - none of the drones are on operational deployments.
Big defense contractors aren’t your friend
Time is money for start-ups. It isn’t for a defense prime … they literally bill for it. Early-stage companies have lean teams, need to ship quickly to build a track record, and need to be paid. Defense primes with billions of dollars sat on their balance sheets … do not.
Increases in complexity, project delays, last-minute changes in requirements - these are all a nightmare for a start-up. But they’re great news for primes. They can suck them up in the short-term and bill handsomely for them later. Anduril delivered its prototype autonomous sub to the Australian Navy after three years - one year ahead of schedule. Contrast that to the mystifying timelines in this story.
A start-up will tell you that it will be impossible to build your all-purpose uber-drone to the timelines and specifications you’re demanding. They will suggest something that actually works and push back on extra requirements. Defense primes will happily take your money in the knowledge that it’s a bad (yet lucrative) idea.
You can just do stuff
We’ve written in the past about how there’s an urgency divide across European countries. In our 2023 report on defense procurement, we touched on how Poland had built a significant tank fleet by purchasing off the shelf platforms from South Korea.
There are, of course, theoretical advantages to integrated European defense programmes. But these advantages don’t mean anything if the equipment is obsolete by the time it’s delivered, or doesn’t ship at all. An unintegrated, real system beats a perfectly harmonized, undelivered one.
This is particularly important in the current technological context. UAV suppliers operating on the frontline are having to upgrade their equipment every few months in the face of evolving electronic war capabilities. It becomes essentially impossible if every adjustment involves securing sign-off across an elaborate chain of defense ministries and subcontractors.
The era of the exquisite platform is over
The Eurodrone is a project from a different era. Whether it’s the conflict in Ukraine, Iran’s strikes on Israel, clashes with the Houthis over shipping - it’s becoming clear that war has changed. As Michael Horowitz, the former U.S. Deputy Assistant Secretary of Defense for Force Development and Emerging Capabilities, argued in a recent essay, we are now entering the age of ‘precise mass’:
Militaries find themselves in a new era in which more and more actors can muster uncrewed systems and missiles and gain access to inexpensive satellites and cutting-edge commercially available technology. With these tools, they can more easily conduct surveillance and stage accurate and devastating attacks. Its imperatives already shape warfare in Ukraine and the Middle East, influence dynamics in the Taiwan Strait, and inform planning and procurement in the Pentagon.
In the era of precise mass, war will be defined in large part by the deployment of huge numbers of uncrewed systems, whether fully autonomous and powered by artificial intelligence or remote-controlled, from outer space to under the sea.
A program that produces tens of drones at a cost of billions of Euros has no role in this future. It’s why we’re so bullish on companies combining commercial off-the-shelf hardware with advanced AI, like our friends at Delian Alliance Industries.
Learn when to cut your losses
If a program isn’t working - just kill it already.
When government ministers say it’s as expensive to scrap something as it is to finish it - they’re almost always wrong. This calculation does not account for the cost of maintaining and supporting the system once it’s delivered. Or the time and effort spent managing the process. Remember - time is (yours and our taxpayer) money! This could all be dedicated elsewhere. To be innovative, you need to internalize the Econ 101 lesson about sunk costs.
Closing thoughts
We’ve written about European defense procurement repeatedly under the loose heading of European Dynamism. The reason we talk about ‘dynamism’ is because we aren’t doomers - we believe that all of these problems are fundamentally fixable. If you’re working on procurement reform or are building in European defense - email us. It’s never too early.