Former Red Cat COO Allan Evans Advocates for CHIPS Act-Style Incentives to Speed up Domestic Drone Manufacturing and Reduce Reliance on Chinese Technology
by DRONELIFE Features Editor Jim Magill
Because the U.S. government considers taking steps to limit the importation of Chinese-manufactured drones, it also needs to consider passing laws that might incentivize domestic drone producers to innovate their products, the previous Chief Operating Officer of American drone company Red Cat Holdings said in an interview.
“I believe that because the U.S. government goes toward eliminating with the ability to import (China’s) DJI from the marketplace, without some additional offset to speed up or jumpstart domestic manufacturing, you’ll see it take a really very long time and require more investment down the road to get us to parity,” said Allan Evans.
Evans, who’s currently the CEO of aviation component manufacturing company Unusual Machines, said he thinks that with a view to help the domestic drone industry Congress should pass a law much like the CHIPS Act, which provides incentives to U.S. microchip makers.
In 2022, citing national security fears, U.S. regulators banned the sale and import of latest communications equipment from Chinese technology firms, including Huawei and ZTE. That very same 12 months, Congress also passed the Creating Helpful Incentives to Produce Semiconductors (CHIPS) and Science Act, which allocated $53 billion in federal incentives for domestic semiconductor research, development and manufacturing.
Currently, Congress is considering several pieces of laws meant to limit or curtail the importation of drones manufactured in China, equivalent to the Countering CCP Drones Act and the Drones for First Responders Act, each introduced by Rep. Elise Stefanik (R.-Latest York). The Countering CCP Drones Act place equipment and services produced by DJI Technologies on a Federal Communications list of things deemed to pose an unacceptable risk to U.S. national security.
The Drones for First Responders Act would implement a brand new tariff on Chinese-produced drones and use the tariff revenue to ascertain a brand new grant program to assist first responders, critical infrastructure providers and farmers purchase recent non-Chinese drones.
Drones: A Critical Technology
“Each side, the Republicans and Democrats, have identified drones as a critical technology,” Evans said. He said the war in Ukraine, where small, unmanned aerial vehicles have proven to be highly adaptable to be used in combat, has alerted lawmakers on either side of the aisle concerning the potential dangers of relying too heavily on drones made in countries that don’t align with U.S. interests.
“I believe that caused everybody in Congress and the Defense Department to say, ‘Whoa, we’d like to have the option to construct these for ourselves,” he said.
Along with the drones themselves, for a big percentage of small UAVs flown all over the world, much of their materials and component parts come from China.
“That is true all the best way all the way down to motors that just about all come from T-motor, which is a Chinese company. Many of the plastics come out of China and these firms are all constructing, selling and manufacturing a ton of fabric, each in Ukraine and Russia right away.”
Of the proposed drone-related federal laws before the present session of Congress, Evans said he prefers the approach taken by the Drones for First Responders Act, because it combines levying tariffs — that might increase the price of Chinese-made drones, thus discouraging American consumers from buying them — while using the proceeds from those self same tariffs to supply an incentive for the consumers to purchase American-made UAVs.
The Importance of US Manufacturing
Evans said that any laws passed to encourage the expansion of the U.S. drone industry should give attention to two fundamental areas for incentives, research and manufacturing. Currently, the Department of Defense is focusing a number of resources toward encouraging drone-related research.
“The opposite one which we’re not doing is manufacturing. And manufacturing at scale takes a number of time and to accumulate the factories,” he said. “Within the CHIPS Act, they’re actually giving grants to construct factories.”
With grant funding to encourage the expansion of the U.S. drone industry, domestic drone manufacturers could reach parity with industry leader DJI inside three to 5 years. Without such funding, even given the passage of the anti-Chinese drone laws that’s currently proposed, it would love take the U.S. drone industry seven to 10 years to meet up with its Chinese competitors, he said.
China Took Steps to Change into a Technology Powerhouse
Evans said the U.S. should follow the instance of China itself in its efforts to grow a sturdy domestic drone industry.
“Within the late ‘90s, Google and Facebook and a few of these other firms were in China, and China kicked all of them out. It was called the Great Firewall, and that’s how Tencent and Baidu and Alibaba and their very own domestic firms grew in their very own marketplace,” he said. These Chinese technology firms at the moment are amongst the biggest on this planet.
No American lawmaker has yet proposed a bill much like the one which Evans is envisioning, and he said that’s unlikely to alter in the course of the current presidential election 12 months. It’s more likely that Congress will pass some type of anti-Chinese drone laws in the course of the current session and afterwards the lawmakers will realize “Oh no, we didn’t do the opposite side thing,” Evans said.
“My guess is it would show up in the subsequent cycle,” he said. “Next summer people will begin to panic and this can show up and it’ll develop into a hot topic.”