While Washington debates what to do about Chinese drones, Michigan is writing checks to build a domestic alternative. The state deployed over $42 million in public and private investment toward drones in 2025, according to a newly released government report that lays out an ambitious vision for the future.
So will that money translate into actual industry dominance?
Michigan’s infrastructure build-out
Michigan now has nine active drone test sites, including the Michigan National All-Domain Warfighting Center in the northern part of the state. There’s a 40-mile drone corridor between Ann Arbor and Detroit, electric aircraft charging stations at four airports, and a 60-mile BVLOS corridor equipped with radar and traffic management software.
All nine of those are:
- NADWC
- Selfridge
- Detroit Smart Parking Lab
- University of Michigan Mcity and M-air
- AAIR (Michigan Central)
- Ford Launchpad for Innovative Technologies and Entrepreneurship (FLITE) at Gerald R. Ford International Airport Authority
- Northsky Innovation Zone (Traverse Connect)
- Mich-Air at Battle Creek
- Jackson Airport/Zephyr Systems.
What deployments are happening in Michigan now?
The state is funding several commercial drone operations, at least in part (though many have multiple funding sources, including private funding). highlights include:
- CVS Health got $1.5 million for pharmaceutical delivery from Troy to nearby pharmacies, making it the first state to have such a grant.
- Jack Demmer Ford received $740,000 to test automotive parts delivery, where drone companies DroneUp, Blueflite and Airspace Link are testing how they can delivery parts to car dealerships within a specific 12-mile radius.
- Munson Healthcare is running medical supply deliveries in northern Michigan.
- Amazon operates some very small-scale Prime Air drone delivery operations in Pontiac and Hazel Park.
- Skyports completed ship-to-shore deliveries in the Great Lakes.
These are actual operations, but many of them are small-scale. A 12-mile radius is better than nothing, but it’s still a tiny scale.
The manufacturing question
Here’s Michigan’s core pitch: the same supply chain that builds cars can build drones. Motors, batteries, carbon fiber, sensors — the components overlap significantly. The state has significant manufacturing capacity and the eighth-largest skilled trades workforce in the country.
And this news also comes at a huge turning point for American drone companies, as — in December 2025 — the Federal Communications Commission banned future foreign-made drones and drone components from legally operating in the U.S. To be clear, that does not ban current models of drones that are already approved for sale, but it does mean that new innovations in drone tech that can be legally sold in the U.S. will need to come from U.S. drone companies. Perhaps Michigan companies could fill that void.
But there’s a gap between theory and execution when it comes to Michigan’s manufacturing expertise. Building drones requires lower volumes, faster iteration and more customization than automotive manufacturing. The state’s report acknowledges this, noting the need to transition suppliers from “high-volume, standardized production to more flexible, agile, high-mix, low-volume operations.”
That’s not a trivial shift. It requires retooling, retraining, and often entirely different business models.
There have been examples of tech companies moving to Detroit to capitalize on that manufacturing skill. For example, Birdstop, which builds enterprise drones primarily used by critical infrastructure facilities and public safety agencies, relocated from Silicon Valley to Detroit in 2025. That said, more companies will need to relocate to Michigan e to create an actual drone manufacturing cluster.
Looking at Michigan with China in context
Michigan’s report states its strategy will “support the Unleashing American Drone Dominance Executive Federal Orders.” Clearly Michigan’s leaders want the companies in its state to replace Chinese drones. And with the latest FCC ban, the need might be real.
But still, Michigan (and U.S. drone manufacturing as a whole) is tiny compared to China. Shenzhen, China has roughly 1,700 drone-related companies generating over $10 billion annually. The region has deep expertise in batteries, motors, composites, and microelectronics — built over decades of concentrated investment and industrial policy.
Michigan has automotive manufacturing and $42 million in recent drone investment.
Even if Michigan successfully attracts drone assembly operations, the component supply chain remains heavily Chinese (which has already led to questions around how that FCC ban will be enforced). These days, many motors, cameras, batteries, electronic speed controllers still come from China — even from drones that claim to be American-made.
Building true supply chain independence would require billions in investment and years of development.
The state’s “AAM Manufacturer Network” is supposed to connect local manufacturers who can support drone production. It’s currently in closed beta with a planned launch this month. We’ll see what’s actually in there.
Workforce reality check
A recent survey of 36 drone manufacturers in Michigan found that 43% are having trouble filling positions. In some part that’s good news for Americans out of work. But the problem? There are seemingly no qualified candidates. The top reasons why those jobs are still unfilled: lack of local availability of specific skills (40%), lack of industry experience (37%), and lack of technical skills (27%).
Michigan is developing training programs through universities, community colleges and vocational schools. But here’s the challenge: you can’t train a workforce for an industry that doesn’t exist yet at scale. It’s a chicken-and-egg problem. Companies need trained workers to grow. Workers need existing jobs to justify getting trained.
The state is trying to solve this with stackable credentials and apprenticeships, but those take time to develop and longer to show results.
Michigan could lean on defense
One area where Michigan has genuine advantage: defense applications. The state has significant military infrastructure, including the National All-Domain Warfighting Center with 17,000 square miles of special use airspace. The annual Northern Strike exercise already tests counter-drone systems.
With federal push for domestic defense drones, Michigan’s dual-use focus (commercial and military applications) makes strategic sense. Defense contracts could provide the stable revenue that early-stage drone companies need to scale.
That said, getting onto the Department of Defense’s Blue UAS list — the approved list of drones for federal use — requires rigorous FAA certification and security clearances.
What to expect from Michigan in 2026 in 2026
Michigan’s priorities for this year include publishing infrastructure standards, expanding BVLOS corridors, pursuing federal funding, and hosting AUVSI XPONENTIAL in May, which is a major industry conference.
Additionally, the state is running something called “Statewide Mobility Challenges” where five state agencies are requesting drone solutions for specific problems. For example, the State Police want drone detection systems, and the Department of Natural Resources needs NDAA-compliant mapping drones. These challenges could generate useful data on what actually works. Or they could end up as expensive procurement exercises that don’t scale beyond initial pilots.
Michigan has advantages: manufacturing infrastructure, engineering talent, defense relationships, and political commitment across state agencies. The $42 million in deployment is real money being invested in an industry that has both promise and problems.
Michigan’s 2030 vision includes “the highest concentration of AAM testing and deployments in the nation” and “more high-growth drone companies than anywhere in the world.”
That’s a bold claim for a state competing against Shenzhen’s entrenched ecosystem and other U.S. states (e.g. North Dakota and Texas) making similar investments.
By 2030, we’ll know if Michigan’s bet paid off — or if $42 million bought a lot of pilot programs that never scaled.
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