Ukraine’s defense companies are turning to exports to fund production and expand their operations, Bloomberg reports. European militaries are keen to use Ukraine’s battle-tested drones to boost defenses against Russian airspace violations.

Producing drones outside Ukraine allows companies to access financing, accelerate innovation, and maintain steady supply for the front line. NATO allies benefit from proven, scalable systems while Ukraine channels revenue into domestic production of advanced drones, Bloomberg notes.

Ukraine now produces millions of drones annually, ranging from long-range strike models to small first-person view (FPV) units. Ukrainian firms continue to refine a wide range of drones, from inexpensive frontline FPV models to advanced long-range and surveillance units capable of operating deep inside Russian territory.

Moving production to safer ground

TSIR, Skyeton, and FlyWell are among the companies expanding production abroad to reduce the risk of Russian attacks, Bloomberg reports. Facilities in Finland, Slovakia, and Denmark aim to supply both Ukrainian forces and allied militaries. 

Skyeton’s Slovak plant attracted over €10 million in foreign investment, while FlyWell is seeking $50 million to expand European production and develop hydrogen-powered drones. Producing outside Ukraine also gives engineers more stable supply chains and opportunities to share expertise with NATO partners.

Battle-tested Ukrainian drones enter NATO plans

Countries including Denmark, Germany, the UK, and Finland are increasingly integrating Ukrainian drones into their defense planning. Beyond supplying their own militaries, these projects help train personnel to operate unmanned systems and develop doctrines for drone-based warfare. Ukraine’s experience producing hundreds of thousands of drones annually positions it as a key contributor to NATO’s capabilities in unmanned conflict.

Ukrainian President Volodymyr Zelenskyy has announced plans to open arms sales offices in Berlin and Copenhagen this year to manage co-production and exports of weapons Ukraine can spare, generating funds for domestic production of critical military hardware.

The expansion reflects a shift from a domestic-focused defense industry toward international collaboration. Ukrainian engineers, seasoned by frontline experience, produce low-cost, effective systems at a pace unmatched by European counterparts, giving NATO partners scalable solutions while maintaining Ukraine’s wartime production capabilities.

Ukraine reinstated a full mechanism for exporting domestically-produced weapons this month, marking a strategic pivot for a defense industry that largely suspended arms exports after Russia's 2022 full-scale invasion. 

On 3 November, Ukrainian President Volodymyr Zelenskyy confirmed that missile production is progressing well, with mass production of several systems expected to be completed by the end of the year. He also mentioned the deployment of new missile models and the expansion of production capacities, particularly for interceptor drones and maritime unmanned vehicles, UNIAN reports. 

Tools of response and strategic pressure

“We are deploying new missiles, including the ‘Flamingo,’” Zelenskyy said.

He did not specify quantities but has noted that the country expects mass production by year-end. He also emphasized the “Neptune” series, already in production and delivering strong results.

“We have standard and extended versions, both performing very well," he explained. 

According to Zelenskyy, these systems are effective against energy infrastructure strikes, targeting resources that fund the aggressor.

Scaling production: 600–800 interceptor drones Per Day

Ukraine is also accelerating production of interceptor UAVs, aiming to reach 600–800 units per day by the end of November, “if all goes according to plan.”

Zelenskyy acknowledged potential setbacks, such as attacks on factories or damage to workshops, but stressed that “so far we have not lost any type of long-range weapon.”

The industry is working alongside the military, with repair teams and logistics restoring production capacity even after strikes.

Berlin and Copenhagen as first hubs of weapon exports

Zelenskyy announced the creation of two European export hubs: “These are for weapons we can afford to sell. The first two will be Berlin and Copenhagen, decided at the company level, and operational this year.”

Revenue from exports will support domestic production of scarce systems. Ukraine also has a surplus of maritime drones and certain artillery systems available for export, provided that proper safety and regulatory oversight are in place.

The Ukrainian president proposed a fair financial mechanism: partners could fully fund the production of scarce weapons in Ukraine, with the resulting systems to be split equally, a method to rapidly mobilize both partner and Ukrainian industrial capacity.

A Ukrainian defense firm has started producing NATO-standard shells for Abrams and Leopard 2 tanks, using Czech documentation and components. The company, now producing only under 5,000 shells monthly, says it aims to double production capacity and eventually localize up to 80% of manufacturing.

Ukraine begins production of NATO-standard shells for Abrams and Leopard 2

Ukrainian Armor has launched full-scale production of 120 mm ammunition for Western main battle tanks Abrams and Leopard 2, the company told Ukrainian defense news outlet Militarnyi. The company said the production was made possible after receiving technological documentation and a license from the Czech-based Czechoslovak Group (CSG), which also supplies key components such as propellant charges, detonators, and initiators.

According to CSG, they do not own any facilities or production technology in Ukraine, but benefit from the project via licensing fees and by supplying critical elements.

“We are proud to be one of the first Western companies to successfully transfer large-caliber ammunition production to Ukraine,” said David Chour, Deputy Chairman of the Board at CSG.

Ukrainian Armor manufactures the projectile bodies locally, handles the filling and final assembly, and conducts testing. The company confirmed that the plant was completed in early 2025 and production began almost immediately.

CSG has developed its own line of 120 mm tank shells compatible with Leopard 2 and Abrams tanks, which use NATO-standard smoothbore guns such as the Rheinmetall L/44 and L/55. The Ukrainian plant currently has the capacity to produce 4,800 of these 120 mm shells per month.

Artillery shells

In its first year of cooperation with CSG, Ukrainian Armor says it plans to produce up to 100,000 artillery rounds of 155 mm caliber and 50,000 rounds of 105 mm caliber. In the future, it aims to double these figures and ultimately reach 300,000 shells per year, according to Militarnyi.

In addition to NATO-standard shells, the Ukrainian company continues producing Soviet-standard 152 mm and 122 mm rounds in parallel.

Ukraine and the United Kingdom begin joint production of Octopus interceptor drones. The initial pilot batch, consisting of up to 1,000 drones, will be built in the UK at state-owned facilities. The Octopus drone will become the first Ukrainian combat drone to be serially produced in a NATO country, with Ukraine retaining full intellectual property and technological control. Combat deployment of the drones will take place in Ukraine after testing.

Britain to build, Ukraine to control and deploy

On 25 October during a live television appearance and later on Facebook, Rustem Umierov, Secretary of the National Security and Defense Council, announced the plan. He confirmed that both software and hardware used in the drones belong to Ukraine. He emphasized that this is a state-level project carried out by the defense ministries of both countries. The technology is classified as sensitive, and Ukraine will maintain control over all critical components, according to Liga.

The official added that the production scale would eventually increase to meet Ukraine’s operational requirements, though the final target figure was not disclosed. The UK will manufacture the first drones in its government facilities, and following successful testing, they will be deployed for combat use in Ukraine.

Agreement signed under defense cooperation framework

According to Ukrinform, the agreement was signed in London within the framework of the Build with Ukraine program. It involved direct collaboration between the defense ministries of both countries. Umierov stated that the Octopus will become the first Ukrainian combat drone to be mass-produced in a NATO country.

In September, the British government had already announced the upcoming agreement, which would cover the joint development and production of advanced military equipment. It also confirmed plans to produce thousands of Octopus drones each month for transfer to Ukraine. The agreement includes technology-sharing provisions expected to create defense-sector jobs in Britain and improve security for both nations.

President Zelenskyy demonstrated the Octopus drone to UK Prime Minister Keir Starmer on 24 October and confirmed the agreement for the first batch of production, as reported by RBC Ukraine.

Octopus to anchor drone-based NATO air defense

In September, Militarnyi reported that the Octopus drones will form the foundation of a European “drone wall” intended to defend against Russian drone and aircraft incursions. British Defense Secretary John Healey told The Telegraph that these Ukrainian-designed drones have already proven effective against Iranian-made Shahed kamikaze drones and are significantly cheaper than foreign equivalents — costing less than one-tenth as much.

The Octopus system is expected to be deployed along NATO borders to deter Russian aerial intrusions. There are also plans to use the drones in missile defense operations protecting military infrastructure and strategic facilities in the UK. 

Earlier in September, Ukrainian drone manufacturer Ukrspecsystems revealed an approximately $250 million investment to build a new production facility in Mildenhall, UK. 

Ukrainian President Volodymyr Zelenskyy rejected claims that Ukraine has used US long-range missiles to hit deep within the Russian territory. The statement came after a Wall Street Journal report alleged that the US lifted restrictions on Ukraine’s use of certain Western weapons for strikes on Russia.

Ukrainian President denies using US weapons for strikes inside Russia

Speaking from the sidelines of the EU leaders’ summit in Brussels on 23 October, Zelenskyy said Ukraine has never launched American long-range weapons at targets deep inside Russia. During a briefing in Brussels, he responded to a journalist’s question about the WSJ article that claimed the US administration had removed limits on using Western missiles against Russia, citing an attack on Russia’s Bryansk Oblast.

“I don’t know who wrote what,” Zelenskyy said. “We never used American weapons for long-range strikes on very important targets in Russia. That’s important.”

He clarified that Ukraine did use various long-range systems, but only in areas of active combat or against Russian forces preparing to launch operations.

Now, President Zelenskyy also stressed that equating attacks on occupied Ukrainian territory with strikes on Russia was incorrect.

“Crimea and the East are Ukraine, and we cannot talk about using any weapon, not even domestically produced ones, against Crimea as if it were Russian territory,” he said. “No, it’s temporarily occupied territory.”

Ukraine turns to its own long-range weapons

Zelenskyy said Ukraine now uses domestically produced long-range systems. These include capabilities ranging from 150 kilometers to 3,000 kilometers. According to him, the key challenge is not technology, but scaling up production.

“The issue is how to get additional funding to mass-produce the long-range capabilities we have,” he explained.

He also referenced Russia’s frozen assets, stating that it was important for Ukraine to access some of those funds to support its weapons manufacturing, as well as European and other allied defense industries.

Ukraine does not need Western help to capitulate, Finnish Foreign Minister Elina Valtonen said on 20 October during her arrival at the EU foreign ministers' meeting in Luxembourg, RFE/RL reports. She added that Ukraine has every capability to continue defending itself against Russian aggression and needs Western assistance only to strengthen that defense.

Finland: Ukraine doesn’t need Western help to surrender

Valtonen was asked about the risks linked to shifting moods of US President Donald Trump, which could indicate reduced support for Ukraine. She said the best response to this would be to strengthen Ukraine. Her comments came in light of reports that Trump allegedly asked Ukrainian President Volodymyr Zelenskyy to give up Donetsk oblast to Russia, including its Ukraine-controlled part, in exchange for freezing the conflict. Trump has denied making such a demand.

“The work is at a stage where everyone wants peace, and it’s clear that President Trump wants it especially strongly, because he promised it to his voters,” Valtonen said. “At the same time, it’s clear that Ukraine doesn’t need help from the West for any capitulation. On the contrary, Ukraine has all the means to continue its own strong defense, and of course, it needs our help for that.”

Valtonen emphasized that Ukraine has the means to defend itself and should be supported in doing so.

Kyiv’s growing defense industry benefits all of Europe, Finland says

Valtonen said Ukraine has shown its capacity not only for defensive struggle but also for broader transformation.

“Ukraine, in particular, has already demonstrated its capabilities. Not only does this lead to a strong defensive struggle, but, first and foremost, the country has in a few years become one of the most competitive defense sectors — one from which we all benefit,” she said.

She also stressed the need to continue the EU’s existing strategy "to strengthen sanctions against Russia’s military machine and help Ukraine not only in its own defensive struggle but also in protecting its civilian infrastructure,” Valtonen added.

Putin shouldn't be "a welcome guest" in the EU, Finnish FM says

Asked about a possible summit between Trump and Russian President Vladimir Putin in the EU, Valtonen said that the location and format of the meeting remain unclear. However, she added:

“It is obvious that a war criminal like Putin should not be a welcome guest at a dinner in the EU.”

On the same day, Bulgaria's Foreign Minister Georg Georgiev said his country may provide Putin an air corridor to Hungary, if he heads there for a meeting with Trump.