Archer Expands Powertrain Tech to Third Parties in Defense Sector

Archer’s Strategic Pivot: Powertrain Tech Goes Third-Party

In a significant strategic shift, Archer Aviation has announced it will begin supplying its proprietary electric powertrain technology to third-party companies. This move marks the first time the eVTOL developer will commercialize its core technology outside of its own aircraft, opening up a new and potentially lucrative revenue stream. The decision underscores a broader trend in the advanced air mobility (AAM) sector, where companies are increasingly looking to diversify their business models beyond future air taxi services, particularly by tapping into the defense and logistics markets.

The inaugural partners for this new venture are U.S.-based defense technology firm Anduril Industries and the UAE-based defense and technology conglomerate, EDGE Group. The collaboration, unveiled at the Dubai Airshow, will see Archer’s powertrain integrated into the “Omen” Autonomous Air Vehicle (AAV), a new hover-to-cruise aircraft co-developed by Anduril and EDGE. This partnership not only validates the performance and reliability of Archer’s technology but also plants a firm flag in the international defense market, an area proving to be a key early adopter of eVTOL-related innovations.

This development is more than just a supply deal; it’s a calculated move that leverages Archer’s investment in vertical integration. By designing and manufacturing its battery packs and electric engines in-house at its U.S. facilities, Archer has cultivated a powertrain that meets the stringent safety and performance standards required for aviation. As Archer’s Founder and CEO, Adam Goldstein, noted, the company views its Midnight aircraft not just as a vehicle, but as a “platform that plays host to a wide range of new and exciting aerospace technologies.” This deal is the first tangible expression of that platform-based strategy, signaling a future where Archer’s innovations could power a diverse array of aerial vehicles.

The Core Technology: A Closer Look at Archer’s Powertrain

At the heart of this agreement is Archer’s proprietary electric powertrain, a system meticulously developed for its flagship Midnight eVTOL. This isn’t just an off-the-shelf solution; it’s a vertically integrated system, meaning Archer controls the design and manufacturing of its most critical components, particularly the battery pack. This strategic decision allows for a high degree of optimization, ensuring the powertrain delivers the necessary performance, safety, and reliability demanded by aviation applications. The system is engineered to be dual-use, capable of powering both commercial and defense aircraft, a versatility that is now being proven with the Omen AAV integration.

The powertrain’s design is a key enabler for the “hover-to-cruise” flight profile of vehicles like Omen and Midnight. This capability allows for vertical takeoff and landing, like a helicopter, combined with the efficiency of a fixed-wing aircraft in forward flight. Manufacturing for this advanced system is handled at Archer’s extensive facilities in the U.S., which span nearly one million square feet and leverage automation in key production areas. This industrial capacity is crucial for scaling production to meet the demands of both its own aircraft fleet and third-party customers like Anduril and EDGE Group.

The selection of Archer’s powertrain by established defense players serves as a powerful external validation of its technology. For a company still navigating the path to commercial air taxi certification, having its core systems chosen for a defense platform provides significant credibility. It demonstrates that the technology is robust and reliable enough for mission-critical applications, a point that resonates with regulators, investors, and future customers alike. This deal effectively de-risks a core element of Archer’s business model by proving its value in a demanding, real-world application before its own air taxi service is even operational.

“While most see our Midnight eVTOL as an aircraft, we view Midnight as a platform that plays host to a wide range of new and exciting aerospace technologies that will be leveraged way beyond our own aircraft.”, Adam Goldstein, Founder and CEO of Archer

Strategic Alliance: Anduril, EDGE Group, and the Omen AAV

The partnership brings together three distinct players at the intersection of aerospace and defense. Anduril Industries is a U.S. company known for its focus on autonomous systems for defense applications. EDGE Group is a major UAE-based conglomerate specializing in defense and technology for military, security, and law enforcement clients. This collaboration deepens an existing relationship between Archer and Anduril, which first partnered in late 2024 to develop a hybrid-powered version of the Midnight aircraft for defense purposes. The success of that initial work appears to have paved the way for this new, more expansive agreement.

The first product to benefit from this trilateral pact is the Omen Autonomous Air Vehicle. Co-developed and set to be co-produced by Anduril and EDGE in the UAE, the Omen is a hover-to-cruise aircraft designed for defense and advanced logistics missions. The immediate demand for such a platform is clear, as the UAE government has already placed an initial commitment to acquire 50 Omen units. This foundational order provides a solid start for the production line and ensures an immediate application for Archer’s supplied powertrains.

This alliance highlights a critical trend within the AAM industry: the pivot toward defense. As eVTOL companies face lengthy and complex regulatory timelines for commercial passenger services, many are turning to the defense sector to generate near-term revenue and demonstrate their technology’s capabilities in a less constrained environment. By supplying a core component to a defense-focused vehicle, Archer gains revenue, operational data, and market validation, all while continuing its primary mission of certifying the Midnight aircraft for urban air mobility. It’s a pragmatic strategy that builds resilience and diversifies the company’s market exposure.

Conclusion: A New Trajectory for Archer and AAM

Archer’s decision to supply its electric powertrain to third parties is a watershed moment for the company and a telling indicator for the entire AAM industry. By commercializing its core technology, Archer is evolving from a vehicle manufacturer into a technology platform provider. This move not only creates a new, high-potential revenue stream but also strategically validates its engineering prowess through adoption by credible defense partners. The deal with Anduril and EDGE Group for the Omen AAV is a powerful first step, and as CEO Adam Goldstein suggested, it is expected to be the “first of multiple partnerships,” hinting at a broader strategy to embed Archer’s technology across the aerospace sector.

Looking ahead, this strategy could significantly influence the competitive landscape. While the ultimate goal for many eVTOL companies remains the launch of urban air taxi networks, the path to profitability may be paved with such B2B technology deals, particularly in the defense and logistics sectors. This approach allows companies to monetize their extensive R&D investments sooner, build manufacturing experience, and establish a market presence while navigating the long road of civil aviation certification. For Archer, this pivot doesn’t detract from its air taxi ambitions; rather, it strengthens the company’s financial and technological foundation, making the entire enterprise more robust and adaptable to the market’s realities.

FAQ

Question: What did Archer Aviation announce?
Answer: Archer announced it will supply its proprietary electric powertrain technology to third-party manufacturers, starting with Anduril Industries and EDGE Group for their Omen Autonomous Air Vehicle.

Question: What is the Omen Autonomous Air Vehicle?
Answer: The Omen is a “hover-to-cruise” autonomous aircraft designed for defense and advanced logistics. It is being co-developed and co-produced by Anduril and EDGE Group in the UAE and will be the first third-party vehicle to use Archer’s electric powertrain.

Question: Why is this deal significant for Archer?
Answer: It marks the first time Archer is commercializing its core technology for a third party, creating a new revenue stream. It also serves as a strong validation of its powertrain’s performance and reliability, particularly within the demanding defense sector.

Sources

• investors archer