January 22, 2025 (NEO - Brian Berletic) - With the conflict in Ukraine exposing how unprepared the United States’ military industrial base is for a peer or near-peer conflict, continued efforts are being made to either match Russian and Chinese military industrial output or otherwise compensate for it.
Many attempts to do so, including ongoing efforts by the US Army to expand 155mm artillery shell production, have shown progress but have fallen far short of matching let alone exceeding the output of just Russian shell production alone.
China, whose industrial base overall dwarfs that of the US, Europe, Japan, and South Korea combined, has demonstrated not only an ability to surpass the US in quantity, but now also in quality.
China has already established one of the largest and most capable missile forces on Earth. It also possesses one of the largest, most advanced integrated air defense systems which includes battle-proven Russia-built S-400 air defense systems. In recent years it has expanded the production of its Chengdu J-20 5th generation warplane to match the numbers of the US’ F-22 fighter jet and is on track to match the annual production rate of the US’ other 5th generation warplane, the F-35.
Last year, China unveiled its own additional 5th generation warplane, the J-35 and will likely expand production to match or exceed that of the J-20.
The US Department of Defense admits that many of the munitions these Chinese warplanes carry are as capable or are more capable than those carried by US warplanes including air-to-air missiles with longer ranges than their US counterparts.
In terms of shipbuilding, China has surpassed the United States so profoundly US policymakers admit closing the gap is unrealistic and instead seek to compensate through the development and manufacturing of large numbers of smaller vessels and aircraft including a variety of autonomous systems.
It should seem obvious that if China is capable of matching or exceeding the US in terms of missile, aircraft, and ship production, possessing the largest most prolific commercial drone company on Earth (DJI), China will be easily able to match or exceed both the quantities and quality of US-made autonomous systems.
Anduril and “Rebuilding the Arsenal of Democracy”
This conclusion appears lost on Palmer Luckey, the founder of Oculus VR - a virtual reality headset manufacturer - and now founder of arms manufacturer Anduril. Luckey believes that Anduril will be able to “hyperscale” production of autonomous aircraft, maritime vessels, and munitions to “rebuild the arsenal of democracy,” and lend victory to the US in a future great-power conflict with China.
Anduril drones have already been used over the battlefield in Ukraine, a peer-conflict the US is waging against Russia by proxy. Those drones have failed to grant Ukraine any advantage as its forces face a total collapse of fighting capacity, losing heavily defended territory to advancing Russian forces at an accelerated rate across the entire line of contact.
Much of Ukraine’s failure on the battlefield is owed to the limits of its Western sponsors and their ability to field practical, low-cost, and numerous enough weapons and systems to match those Russia is deploying.
It could be argued that Anduril’s technology hasn’t been fully matured and the advantage of “hyperscaling” not yet been fully realized, but a much more likely explanation is a fundamental flaw in Anduril’s approach based on an equally flawed understanding of geopolitics and national security, coupled with self-serving short-sighted priorities including profit-over-purpose.
In a January 17, 2025 interview with Bloomberg Technology, Luckey described the building of “Arsenal 1,” Anduril’s first “hyperscale” production facility. Based in Ohio, Luckey claims it will provide up to 4,000 jobs over the course of the next 10 years and produce 1,000s of Anduril “defense products” including cruise missiles and autonomous warplanes.
Luckey sells “Arsenal 1” as a vision of not only revolutionizing US-based military manufacturing, but as a means of compensating for China’s vast industrial base and growing military might. To fully achieve this vision, however, Luckey insists on the US “leveraging the whole of the nation,” to face and overcome the threat he claims China poses.
Selling Overpriced, Under-Performing or So-Far Non-Existent Weapons
Forbes, in its own recent article about the construction of the facility, claims:
The plant is designed to produce tens of thousands of drones per year. Initially these are likely to be Anduril’s current product range , the Fury an autonomous jet fighter which work alongside crewed platforms, the Roadrunner, a one-way interceptor and attack drone and Barracuda, a family of long-range attack drones or cruise missiles with ranges of 100-500 miles.
However, based on publicly available information, neither the Fury nor the Barracuda have been built even as prototypes let alone finished products. Instead, Luckey often poses in front of what are most likely 1:1 scale models of the proposed weapon systems which will face years of further development before they end up mass produced and sold to the US government or exported abroad.
While the Roadrunner has been built and tested, and even ordered by the Pentagon to the tune of over 500 units, it is unlikely the system represents a cost-effective solution amid modern conflicts such as Ukraine featuring thousands of drones and missiles fired per year.
According to Luckey, the Roadrunner’s price is in the “low hundreds of thousands of dollars” per unit, while the Russian-made Geran-2 long-range kamikaze attack drone - for example - is estimated by Western sources to cost approximately 50,000 USD per unit. The Russian military industrial base produces thousands of Geran-2 drones each year and has produced hundreds of thousands of attack and surveillance drones each year for even cheaper still, making the Roadrunner even more impractical for modern-day combat.
What Anduril offers is what is perhaps a cheaper and faster way to manufacture military equipment compared to current US military industrial capabilities, but still falls far short of meeting the practicality, quantity, and quality of weapons and munitions produced by Russian or Chinese state-owned enterprises.
This is because Anduril, first and foremost, exists to generate profits, whereas Russian and Chinese state-owned enterprises exist first and foremost to fulfill the demands of each nation’s respective military services and the national security objectives they uphold.
But there is a deeper problem still. Regardless of whether or not one takes Luckey’s claims at face value and believes his company and companies like it across the collective West could produce more weapons of better quality and capabilities than Russia and/or China, is the mobilization of skilled labor, national infrastructure, and industry by the United States justified in achieving Luckey’s vision?
Profits Over Purpose and Peace
The need to “hyperscale” production, according to Luckey, is based on the fear the US would run out of arms and ammunition after just 8 days of war with China and that:
“...people are predicting that there's going to be a window of opportunity for [Chinese President Xi Jinping] in China that opens in 2027. That means that you necessarily need to be ready for a potential great power conflict with China in 2027 and for at least a few years after that.”
The impression many may draw by the sense of urgency Luckey attempts to create is that China poses a direct and imminent threat to the United States. It doesn’t.
Luckey conceded that weapons produced in his Ohio “Arsenal 1” facility could be flown, “directly to the theater, of course, probably with refueling stops along the way.”
This is because any potential war fought between the US and China will be fought off China’s own shores and across the Asia-Pacific region where the US has spent decades accumulating tens of thousands of US military forces closer to China than to America’s own shores.
In other words, any potential conflict fought between the US and China will be provoked by and a product of US encroachment, not extraterritorial aggression from China itself.
In fact, Luckey himself is well aware of this, having worked with the US government to sell military systems to the US-backed administration on China’s island province of Taiwan, provoking condemnation from the Chinese government as a result.
In a clip presented by Bloomberg Television, Luckey brags about his company being sanctioned by the Chinese government for providing military systems to Taiwan, recognized under international law as well as by the US government’s own “One China” policy, as Chinese territory. Luckey’s violation of Chinese sovereignty and his role in abetting separatism within China’s borders is a microcosm of the wider war Luckey is attempting to promote and profit from at “hyperscale.”
One final point of interest was revealed during Luckey’s interview with Bloomberg Technology.
When asked whether or not Luckey would be spending more time in Ohio as a result of the facility’s construction, he responded:
“I'm definitely going to be buying a house out here. I'm blessed with financial success for my first company, Oculus VR, that allows me to get a place so I don't have to get a hotel room when I'm spending time out here.”
Of course, Palmer Luckey’s role at Anduril also contributes millions of dollars annually to his personal “financial success,” allowing him to simply buy houses anywhere he goes rather than stay at hotels. According to Tech Crunch, Palmer Luckey netted nearly 11 million USD in 2021 in his capacity as Anduril’s founder.
In other words, Palmer Luckey is selling war with China rhetorically and politically, to sell weapons and profit financially.
The more fear and urgency he can generate, the more weapons he can sell - regardless of their practicality or performance - and the more his company and he himself personally profits.
Whether Luckey really believes China is a threat or that Anduril is the answer to that threat is irrelevant. The true nature of Anduril and people like Palmer Luckey leading it prevents it and the rest of the collective West’s for-profit military industrial base from matching, let alone exceeding Russian or Chinese military industrial output. This truth, demonstrated amid the ongoing conflict in Ukraine, reflects the true profit-driven motivations of Anduril and Luckey, whether Anduril and Luckey understand it or want to admit it or not.
For Americans convinced by Luckey’s rhetoric that China truly is an urgent threat to them and their way of life, it is actually Palmer Luckey, Anduril, and other companies and individuals like them demanding America “leverage the whole of the nation” by diverting resources needed to thrive at home, toward efforts to antagonize and coerce other nations abroad.
This results in transferring the wealth of the American people toward Palmer Luckey’s over-priced weapons and ultimately toward his next new home, rather than toward better education, healthcare, and infrastructure for the average American man, woman, or child.
In the end, Palmer Luckey and Anduril pose a much greater threat in reality to the average American and their way of life, than any threat China is claimed to pose in fiction.
Brian Berletic is a Bangkok-based geopolitical researcher and writer.
