Taipei: Aerospace Industrial Development Corp. (AIDC) is steering its focus toward the drone industry as its next major growth driver, with Chairman Tsao Chin-ping highlighting the increasing global demand for drones as the company transitions from its traditional aircraft manufacturing roots to developing comprehensive drone systems.
According to Focus Taiwan, Tsao explained that AIDC, which has been a longstanding supporter of Taiwan's national defense, is hastening its transformation strategy as the Brave Eagle advanced jet trainer project approaches completion.
AIDC has announced that the 66 Brave Eagle jets commissioned by the Air Force are anticipated to be fully delivered by the third quarter of this year. As part of its transformation strategy, AIDC is adopting a "two-pronged approach" that continues to support domestically produced aircraft through maintenance and performance upgrades, while simultaneously accelerating its entry into the burgeoning drone industry.
Drones have been identified by Tsao as a pivotal component of Taiwan's asymmetric defense strategy, supported by a NT$1.25 trillion (US$39.56 billion) eight-year special defense budget aimed at enhancing national defense resilience. In the drone sector, AIDC is transitioning from a supporting role to engaging in independent research and development, collaborating with academia and industry, and actively bidding on projects related to drone and counter-drone systems.
AIDC is currently partnering with domestic manufacturers Taiwan UAV and Thunder Tiger on production efforts, and with U.S.-based Vantor to develop GPS-free visual positioning technology. Additionally, the company is working with Shield AI on software to create a unified command-and-control system that enhances drones' operational capabilities alongside manned aircraft and across multiple platforms in coordinated missions. Although Tsao noted that these developments might not immediately boost AIDC's revenue, they are crucial for building capabilities within the entire drone ecosystem.
Counter-drone systems are also a significant focus for AIDC, with soft-kill systems to jam or disrupt drones nearly complete and hard-kill systems expected to be ready by midyear. Tsao emphasized the importance of avoiding Chinese-made parts, citing the Russia-Ukraine war as a reminder that cybersecurity and backend risks in drones can directly impact combat effectiveness. Taiwan's drone industry is already proficient in producing key components such as chips, communications, navigation, optics, and mission modules.
Customs Administration data indicated that drone exports from Taiwan surged from just 93 units at the end of 2023 to more than 70,000 units by the fourth quarter of last year. Taiwan has also become part of the supply chains for U.S. drone maker Skydio and French company Parrot and has emerged as a crucial sourcing partner for countries like Poland.
AIDC's expansion into the U.S. market involves plans to establish a plant in Arizona, driven by the Buy American Act, to shorten supply chains and enhance delivery speed and reliability. Initially focused on producing engine components, the Arizona plant may later expand into drone or other aerospace manufacturing, contingent upon local regulations, workforce structure, and cost conditions. Potential customers include the U.S. military and private-sector clients, with the Arizona facility serving as a foundation for deeper industrial cooperation between Taiwan and the United States.