APFIT Invests $50 Million into US-Made Drone Battery Production for Air Force, Army, Navy, and SOCOM

December 8, 2025

The Badland Batteries manufacturing facility where Packet Digital will be designing and manufacturing drone batteries for the U.S. Air Force, Army, Navy and Special Operations Command. (Image: Packet Digital)

The Defense Department’s APFIT program has committed up to $50 million to Packet Digital to fast-track production of advanced batteries for U.S. military uncrewed aerial systems (UAS), supporting the Air Force, Army, Navy, and Special Operations Command (SOCOM).

The U.S. defense ecosystem currently lacks a reliable domestic supply chain for lithium-ion batteries—a critical gap as the nation works to maintain superiority across air, space, and underwater domains. To address this, Packet Digital’s Badland Batteries facility in Fargo, North Dakota, will begin producing U.S.-made battery cells in 2026, delivering secure, high-performance energy solutions for defense applications.

“Our advanced high-power, high-energy density lithium-ion cell technology is a mission-critical enabler for extended-range UAS operations, space-based platforms, and submersible assets,” said Terri Zimmerman, CEO of Packet Digital. “This capability directly enhances warfighter readiness by improving endurance, agility and energy resilience in contested environments.

“The U.S. currently lacks the manufacturing base for high-energy battery cells at the scale required for defense platforms,” Zimmerman added. “We are working every day to close that gap and ensure our warfighters have the tools they need.”

Expanding Defense Partnerships

The APFIT award builds on a series of recent contracts awarded to Packet Digital across multiple defense agencies:

U.S. Navy:

January 2025: Follow-on contract for UAS smart batteries, chargers, and power systems.
December 2022: $8.5 million contract to develop standardized battery solutions for ship-to-ship and ship-to-shore missions.

Air Force Research Laboratory (AFRL):

$7.2 million add-on contract for satellite power solutions following successful completion of an initial $8 million project to build a high-powered SmallSat power converter with 98 percent efficiency.
The new effort expands scalable power systems for CubeSats and SmallSats using advanced MPPT and PMAD architecture.

Scaling Production for Future Needs

Packet Digital announced a new drone battery and power systems production contract with the U.S. Navy in January 2025. (Image: Packet Digital)

Packet Digital has significantly expanded its manufacturing capabilities at its Fargo facility, integrating surface mount technology (SMT) lines, automated welding systems, and state-of-the-art assembly spaces. These upgrades position the company to deliver high volumes of smart battery packs for some of the most advanced UAS systems in the world.

“We have scaled our operations to meet increasing demand,” Zimmerman said. “By combining automation with our talented engineering team, we’re achieving unprecedented quality in battery packs and charging systems for the Navy drone fleet.”

Looking Ahead

The APFIT investment will accelerate development at Packet Digital’s new 80,000-square-foot Badland Batteries plant, the company’s third location. Full-scale battery cell production is scheduled to begin in 2026, strengthening the U.S. defense supply chain and enabling next-generation energy solutions for military platforms.

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