Saudi Arabia, US To Manufacture Drones Inspired By Iran's Shahed: Report

Iran's Shahed drones, which have repeatedly targeted Gulf countries during the recent conflict in the region, are now becoming the blueprint for a new drone manufacturing project in Saudi Arabia backed by a US defence startup.

A new facility planned near Riyadh will manufacture long-range attack drones through a partnership between American firm Vector Defense and Saudi startup SR2 Defense Systems, Semafor reported.

The joint venture, called SR2Vector, is preparing to build a drone system known as SKYWASP, designed for one-way strike missions similar to Iran's Shahed drones.

As per the report, the drone has a strike range of nearly 1,500 kilometres, enough to reach Tehran from parts of Saudi Arabia. “SKYWASP is a program that can level the playing field and boost Saudi Arabia's deterrence capabilities,” Lucien Zeigler, co-founder and chief strategy officer at SR2, told Semafor.

He said the plant would produce drones in “operationally relevant volumes consistent with the kingdom's strategic deterrence requirements.” Though Zeigler didn't reveal the exact production capacity of the factory and when manufacturing would begin or how much money is being invested into the facility.

The drones are expected to be supplied to Saudi Arabia as well as allied countries overseas. Funding support for the project will come from MASNA Ventures, a defense-focused technology investment fund currently being assembled by Zeigler.

The development comes after months of attacks in the region involving missiles and drones following the outbreak of war involving Iran earlier this year. Gulf countries have faced repeated aerial threats since late February with some projectiles managing to strike hotels, energy infrastructure and data centres despite heavy air defence deployments.

Iran's Shahed drones have become particularly significant because of their low production cost compared to the expensive missile systems required to intercept them. Estimates suggest a Shahed drone can be built for around $35,000 while the defensive systems used against them cost considerably more.

That gap has pushed Gulf governments to look for cheaper alternatives. Interest has also grown in Ukrainian drone expertise especially after Russia deployed its own Shahed-style systems extensively during the war in Ukraine.

Saudi Arabia, one of the world's top military spenders, still depends heavily on imported defense equipment. The kingdom has set a goal of manufacturing half of its military hardware locally by 2030 as part of its wider economic and strategic plans.

The new drone venture also comes amid closer defense ties between Washington and Riyadh. Last year, Saudi Arabia was designated a major non-NATO ally by the United States after Crown Prince Mohammed bin Salman met President Donald Trump at the White House.