US Army cancels FTUAS and the MQ-1 Gray Eagle as part of the Army Transformation Initiative

FTUAS to be scrapped

Last week, Sen. Jack Reed (D-R.I.), the US Senate Armed Services Committee’s ranking member, stated that the Army had announced its intent to cancel the Future Tactical UAS (FTUAS) effort. The revelation came during a committee hearing to consider the nominations of Michael Obadal to be undersecretary of the Army. 

The news of the planned ending of the FTUAS effort came one week after, on 1 May 2025, the US Army announced the Army Transformation Initiative (ATI). This strategy will, among other things, re-examine all requirements and eliminate waste and obsolete procurement programmes, with the Letter to the Force: Army Transformation Initiative outlining this policy, arguing that “yesterday’s weapons will not win tomorrow's wars”. Shephard has already reported on the implications of this strategy for land domain procurements. 

FTUAS is a long-standing US Army programme intended to provide a tactical ISTAR capability for US Army Brigade Combat Teams (BCTs), replacing the Textron Systems RQ-7 Shadow, which has been in service with the US Army since 2000. Following a demonstration rodeo, attended by various bid teams, including Textron, L3 Harris teamed with Griffon Aerospace, and Northrop Grumman teamed with Martin UAV, AeroVironment was awarded a US$8 million contract to supply six Jump 20 aircraft and supporting equipment to the US Army under Increment 1 of the FTUAS effort. 

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AeroVironment calls on US Army to scrap FTUAS Increment 2

Axe swings on US Army procurements

The purchase was meant to inform requirements for Increment 2, which was split into five development phases,  including a base and four option periods between 2023 and 2025. The bid teams were whittled down to two, with Textron competing against L3 Harris, teamed with Griffon Aerospace. Both teams received option two contracts in September 2023 and option three and four in April 2024. The effort was meant to enter full-rate production in Q4 FY2025, before Reed’s comments confirmed its imminent cancellation.

Interestingly, some industry members recognised years ago that the programme was expensive and slow to deliver UAVs to warfighters. Wahid Nawabi, President and CEO of AeroVironment, told Shephard in 2022 that Increment 2 of FTUAS should be scrapped, complaining the process was too long and would “waste more money and the army's time before moving to a programme of record”. 

Gray Eagle to be cancelled

FTUAS is not the only large US Army UAV procurement to be cancelled, with The Letter to the Force outlining the ATI explicitly stating that the procurement of “obsolete UAVs like the Gray Eagle” would be cancelled. 

The US Army initiated the MQ-1 Gray Eagle development in 2002. Since then, according to the FY2025 Budget Request documentation, the US Army has funded 298 Gray Eagles, with the programme of record covering the procurement of the Gray Eagle, the Gray Eagle ER and the Gray Eagle 25M variants. 

Out of these 298 aircraft for the Army, it appears that only possibly the last 12, acquired through a not-to-exceed $389 million contract announced by GA-ASI in December 2023, could be cancelled. The aircraft appear years away from being delivered, with GA-ASI previously stating they would be delivered following the delivery of the 12 Gray Eagle 25M (GE-25M) acquired by the National Guard in 2023, which, as per a GA-ASI announcement in April 2025, are not due to begin until 2027.

Other savings from cancelling the MQ-1 Gray Eagle procurement are more certain. As shown in the FY2025 budget document, the MQ-1 payload budget estimated that $164.9 million would be required to procure various subsystems for the UAV from FY2025 to FY2029. 

Similarly, the Gray Eagle Modification/Product Improvement Program (PIP), which involves the procurement of various subsystems, such as control stations, datalinks, avionics and payloads, was projected to spend $79.5 million between FY2025 and FY2029, with the procurement expected to continue in the 2030s for undisclosed amounts.

Therefore, it can be estimated that the US Army could save $633.4 million by ending the Gray Eagle subsystem procurements and cancelling the most recent order of 12 units. 

More savings, however, could be made. As mentioned above, in 2023, the National Guard Association of the US (NGUAS) acquired 12 GE-25M aircraft 2023, but it has always stressed the need to procure additional units, which may now be jeopardised. 

In January 2023, retired Col. Mike Hadley, the association’s VP for government affairs, clarified that purchasing 12 units was “just the start” since only one Guard division would be equipped with Gray Eagles, out of the “eight” that “urgently need them”. Hadley confirmed that the NGUAS would work with Congress throughout 2023 to continue this effort – an effort which is now surely over.

Trump looks for wins in the Middle East

The ending of long-standing domestic UAV procurement programmes could prove unpopular for the Trump Administration. In this context, the President’s trip to the Middle East appears extra significant, with the possible signing of any of the colossal procurements announced from Qatar, Saudi Arabia and the UAE for the American MQ-9B representing a possible big win for Trump.

Related Programmes in Defence Insight

RQ-7 Shadow Replacement / Post Future Tactical UAS (FTUAS) [US Army]

MQ-1 Gray Eagle [US Army]

Gray Eagle 25M (National Guard) (Additional Units) [USA]

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