As private companies test next-generation drone technology at Camp Grayling this week, Michigan is making a play for a rapidly expanding industry backed by billions in Pentagon spending. With a $30 billion defense and aerospace sector already supporting about 166,000 Michigan jobs, the bigger prize isn’t what flies over Grayling — it’s the companies, factories and high-paying jobs that could stay after the drones land.
GRAYLING — Private drone companies are testing their technology at Camp Grayling this week against the kind of electronic warfare disrupting drones on the battlefield in Ukraine — the latest step in Michigan’s push to capture companies, defense contracts, factories and high-paying jobs from America’s rapidly expanding drone industry.
Michigan isn’t starting from scratch.
The state already has a surprisingly large defense and aerospace economy generating roughly $30 billion annually and supporting about 166,000 jobs, along with thousands of companies involved in defense, aerospace, homeland security and related industries.
Now Michigan is trying to add drones and autonomous aircraft to that economic engine.
And the strategy extends beyond military drones.
Michigan also is putting $2 million into five civilian Advanced Air Mobility projects, using drones and aerial technology to monitor wildfires, inspect roads, test water quality, investigate pesticide contamination and detect unauthorized aircraft.
Taken together, the pieces suggest a much larger economic-development strategy:
Develop drones here. Test them here. Sell them to government here. And ultimately build them here.
Camp Grayling Tests The Battlefield Of The Future
The U.S. Army is hosting a special testing opportunity for private industry at Camp Grayling this week.
Companies are being given an opportunity to test drones and counter-drone technologies in an environment designed to reproduce the communications and electronic-warfare problems systems increasingly encounter on modern battlefields.
The war in Ukraine has demonstrated how important those capabilities have become.
Relatively inexpensive drones are now being used for reconnaissance, targeting and attacks, while opposing forces employ electronic warfare to disrupt communications and navigation.
The Army wants American companies to discover those vulnerabilities during testing rather than after their equipment reaches soldiers.
And Camp Grayling isn’t expected to host this type of private-sector testing just once.
The Army has said it expects to provide the opportunity quarterly, potentially creating a continuing pipeline of defense technology companies coming to Northern Michigan to prove their systems.
49 Companies Already Brought Their Drones To Michigan
Michigan received an even larger demonstration of the opportunity in June.
Forty-nine companies were invited to bring 79 unmanned aircraft systems to Camp Grayling for the Pentagon’s Drone Dominance Program Phase II qualifying competition.
The systems were evaluated during day and night operations involving military missions including long-range strike and tactical assault in confined environments.
Nineteen companies advanced.
The broader Drone Dominance Program involves approximately $1.1 billion in prototype orders, illustrating how aggressively the Pentagon is moving to acquire relatively inexpensive unmanned systems.
For Michigan, however, the economic opportunity potentially extends far beyond hosting competitions.
Someone eventually has to manufacture those drones.
Michigan’s Quiet $30 Billion Defense Economy
Michigan is known worldwide for automobiles, but its defense and aerospace economy gets considerably less attention.
The sector generates roughly $30 billion in annual economic activity and supports approximately 166,000 Michigan jobs.
Michigan also has thousands of businesses participating in defense, aerospace, homeland security and related industries.
Those numbers make drones potentially much more than another technology-development initiative.
They could become an extension of an industry already supporting a substantial number of Michigan workers.
Michigan also possesses military infrastructure that would be extremely difficult for another state to reproduce.
Camp Grayling is part of the National All-Domain Warfighting Center, which combines enormous training areas with access to thousands of square miles of special-use airspace.
Other Michigan defense assets include Selfridge Air National Guard Base, the Alpena Combat Readiness Training Center, Battle Creek Air National Guard Base and the Detroit Arsenal.
Then came another important development in August.
The Army selected Camp Grayling as one of only four premier stateside military test ranges being opened to private industry for research, development and rapid experimentation.
Companies don’t necessarily need to arrive with an existing military contract.
The objective is to make it easier for private companies to bring promising technologies into realistic environments, find out whether they work and potentially get successful products into military procurement faster.
For Michigan, Camp Grayling therefore becomes more than a military training facility.
It becomes an economic-development asset.
Michigan’s Drone Strategy Moves Beyond The Military
While the Pentagon is testing military drones at Grayling, Michigan is simultaneously trying to build civilian markets for similar technologies.
The Michigan Department of Labor and Economic Opportunity’s Office of Future Mobility and Electrification has selected five companies to share $2 million through the state’s Advanced Air Mobility Statewide Mobility Challenges.
The projects pair technology companies with five Michigan government departments.
Instead of laboratory demonstrations, the companies will use their technologies to solve actual government problems involving public safety, infrastructure, environmental monitoring and agriculture.
Drones Could Watch Michigan Wildfires And Water
The Michigan Department of Natural Resources will work with Orb Aerospace, using vertical takeoff and landing drone technology for aerial mapping, wildfire monitoring and natural-resource management.
The technology could also help with prescribed burns, wildlife management and natural-disaster response.
Michigan’s Department of Environment, Great Lakes, and Energy will work with Kohtari, deploying aerial sensors for real-time air and water-quality monitoring and environmental incident response.
Kohtari also plans to use predictive intelligence to monitor the Grand River watershed for water-quality problems and potential algal blooms.
AI Takes To Michigan Roads
The Michigan Department of Transportation will work with Westwood AI on a road-intelligence platform combining information gathered by drones with vehicle-generated data.
The objective is to provide transportation officials and emergency responders with better real-time information about crashes, congestion and other roadway incidents.
Westwood AI CEO Dakoyta Greenman, a former firefighter, said responders frequently must make critical decisions without knowing what is happening beyond their immediate surroundings.
The company’s AeroRanger technology is intended to provide that wider view.
Michigan State Police Will Hunt Other Drones
One of the most intriguing projects reverses the equation.
Michigan State Police will work with Motorola Solutions on technology designed to detect and track unauthorized drones.
Civilian applications could include protecting crowded stadiums, major public events and critical infrastructure.
But drone detection also illustrates how increasingly difficult it is to draw a sharp line between civilian and defense technologies.
The same basic capability used to detect an unauthorized drone approaching a stadium could have applications protecting a military installation or other sensitive infrastructure.
Motorola Solutions said identifying and tracking airspace activity can give police faster information for making security decisions.
Michigan Agriculture Gets Its Own Drone Experiment
The Michigan Department of Agriculture and Rural Development will work with AVOL to use aerial technology to investigate pesticide drift.
The aircraft can collect potentially hazardous samples, detect pesticide residue and document damage to crops and plants.
That could reduce investigation times while keeping workers away from potentially contaminated locations.
But AVOL also supplied perhaps the most important economic-development statement contained in Michigan’s announcement.
CEO Nate Poon said the pilot could create a pathway toward Michigan-based operations and manufacturing partnerships while reducing thousands of labor hours and workplace risks.
That is ultimately what Michigan needs if its drone strategy is going to produce significant economic growth.
The Real Prize Is Manufacturing And Jobs
Michigan’s Advanced Air Mobility Initiative was established in 2025 partly to position the state’s workforce, manufacturers and infrastructure for the growing aerial-mobility industry.
Michigan will have plenty of competition.
Traditional aerospace states and emerging technology centers also want the companies, factories and federal dollars flowing toward drones and autonomous aviation.
But Michigan can make an unusual pitch:
It already has a roughly $30 billion defense and aerospace economy supporting about 166,000 jobs.
It has one of four Army test ranges being opened to private companies.
It has government agencies willing to become real-world testing grounds for civilian technology.
And perhaps most importantly, it possesses one of the largest advanced-manufacturing ecosystems in the world.
This week’s Camp Grayling testing demonstrates that companies are already coming to Michigan to prove whether their technology works.
The state’s $2 million Advanced Air Mobility program gives another group of companies real-world civilian customers and problems to solve.
The next challenge is turning that activity into Michigan companies, Michigan factories and Michigan jobs.
And that raises an even bigger question.
Michigan’s automobile industry is restructuring as sales slow, technology changes and manufacturers shed workers. At the same time, the Pentagon wants American industry capable of producing drones and other autonomous systems at enormous scale.
Could Michigan’s automotive manufacturing expertise — and perhaps eventually some of the workers and suppliers displaced by changes in the auto industry — become part of America’s emerging drone industry?
Coming in Part Two: Could Drones Replace Lost Michigan Auto Jobs? Why Detroit’s Manufacturing Machine May Be Built For The Drone Age.
