Three San Diego-linked drone makers are heading into one of the Pentagon’s hottest new test events, with a lot more than bragging rights on the line. Firestorm Labs, ModalAI, and Kratos SRE have been short-listed to compete in the opening trials of the Department of Defense’s Drone Dominance program.
The first round, known as the Gauntlet, is a rapid-fire prototype showdown that will hand military operators dozens of uncrewed systems to fly, break, and grade. The event kicks off next Wednesday at Fort Benning and runs into early March. For young defense firms in particular, it is a rare path to fast-track procurement and the kind of government orders that can ramp production with almost no warning.
What The Gauntlet Is
The Gauntlet marks the opening phase of the Pentagon’s four-part Drone Dominance initiative, a push to field low-cost, one-way attack drones at scale. The overall effort is slated to use roughly $1.1 billion across its phases in order to equip forces by 2027, starting with prototype delivery orders worth about $150 million.
During the Fort Benning trials, dozens of vendors will cycle through short, iterative tests while military operators fly and score each system. The department plans to buy prototypes from the strongest performers, then increase production for those winners. As reported by Defense News, Defense Secretary Pete Hegseth has pitched the approach as a way to “buy what works, fast, at scale.”
San Diego Firms In The Lineup
Local business coverage has spotlighted Firestorm Labs and ModalAI, both based in San Diego, alongside Kratos’ SRE unit as among the firms tapped for Gauntlet I. The trio sits inside a 25-vendor field that blends young startups, long-time contractors, and a couple of Ukrainian builders with battlefield experience, a mix Pentagon officials hope will speed design tweaks and upgrades.
As reported by the San Diego Business Journal, that cluster of San Diego names highlights the region’s growing weight in unmanned systems and defense manufacturing.
Firestorm’s Pitch: Build Anywhere
Firestorm Labs is leaning on an expeditionary manufacturing concept centered on its containerized “xCell” platform, which the company says can 3-D print airframes and assemble mission kits right at the point of need. The startup closed a $47 million Series A round last July, and its materials state that this model has already produced multiple Department of Defense engagements. According to Firestorm, the approach is meant to let units repair, modify, and produce small uncrewed aircraft systems quickly in austere environments.
ModalAI: Autonomy Built In The U.S.
ModalAI, led by CEO Chad Sweet and formed in 2018 by former Qualcomm engineers, provides VOXL autopilots and autonomy stacks that the company says are assembled in the United States and built to satisfy the NDAA’s Blue sUAS requirements. The firm’s product literature and press releases highlight U.S. assembly and Section 848 compliance as key selling points for Pentagon buyers, per ModalAI. That autonomy-focused pitch places ModalAI as a supplier of the onboard “brain” that many competing airframes still need.
Kratos Brings Production Muscle
Kratos SRE serves as the advanced engineering arm that Kratos created after acquiring Southern Research’s engineering division in May 2022. Kratos, a publicly traded defense contractor headquartered in San Diego, reported about $1.14 billion in revenue for 2024 and roughly 4,000 employees across 14 countries as of year-end 2024, according to its Kratos. That scale provides a manufacturing and testing footprint that most startups simply do not have, making Kratos a heavyweight presence in a field otherwise packed with smaller builders.
What Comes After The Gauntlet
During the Gauntlet, military operators will put each system through its paces, then hand over their evaluations. After that first culling, the department plans to narrow the list of vendors through later phases, while simultaneously increasing order volumes and pushing unit costs down.
Pentagon planning documents and reporting indicate that later stages could see orders climb into the tens of thousands, with per-unit prices moving toward the program’s $2,300 target as production scales. Observers say the decision to combine battlefield-tested Ukrainian designs with U.S. startups and legacy contractors is meant to speed up learning and send a clear, steady demand signal in order to build industrial capacity quickly, incorporating lessons from Ukrainian builders now in the mix, as reported by Business Insider.
For San Diego companies, the week-long trials double as a technical exam and a pivotal business moment. A strong performance could translate into rapid prototype orders and a larger role in the Drone Dominance buildout. Local coverage notes that a Gauntlet win or even a standout showing could accelerate hiring, fresh investment, and supplier growth across the region, according to the San Diego Business Journal.