Mentioned:
The United States Army is aiming to build drones without any Chinese parts or materials. Which is exactly why they’ve just done a deal with a private rare earth magnet company.
What’s happening:
- The United States Army has selected Vulcan Elements to supply rare earth magnets for SkyFoundry drone motors
Why it matters:
- SkyFoundry is a pilot program started by the United States Army to rapidly develop, test and manufacture small drones at scale and without any dependency on China
Going deeper:
- Vulcan Elements will supply SkyFoundry with high performance neodymium-iron-boron rare earth magnets as part of the new deal
- Vulcan Elements previously raised $65M USD in a financing round which was led by Brad Gerstner’s Altimeter Capital Management
- Energy Fuels (NYSE: UUUU) and Vulcan Elements have an existing partnership in which Energy Fuels will provide Vulcan Elements with rare earth oxides
The intrigue:
- The United States Department of War notably committed $620M USD in direct loans to Vulcan Elements to scale their domestic rare earth magnet production capacity
The fine print:
- Vulcan Elements has not publicly disclosed what the contract value is or any committed purchase volume from the United States Army
