Hydrix has signed a binding contract with NIOA Group to support the design, development and integration of a telemetry-capable inert proximity fuze and kinetic effector payload package for small uncrewed aerial systems (sUAS), in a move aimed at strengthening Australia’s sovereign manufacturing and counter-drone Defence capability.
According to Hydrix, the initial contract is valued at between $1 million and $1.2 million, with the program scheduled to ramp up in May 2026 ahead of a December demonstration milestone.
Design optimisation work is expected to continue through to the March quarter of 2027.
Hydrix said the engagement combines NIOA’s expertise in munitions design and energetics manufacturing with Hydrix’s capabilities in mission-critical embedded electronics, software engineering and systems integration for counter-drone technologies.
The company said the project supports the development of deployable asymmetric counter-drone capability, an area identified as a priority by the Australian Defence Force under the 2026 National Defence Strategy and the Federal Government’s A$425 billion Integrated Investment Program, which includes up to A$7 billion allocated to counter-drone capability initiatives.
Hydrix said it was selected following a competitive tender process, citing the company’s engineering and systems integration capability in mission-critical Defence applications.
Hydrix chief executive officer Gavin Coote said the agreement expanded the company’s role within Australia’s sovereign Defence technology sector.
“NIOA’s selection of Hydrix further expands our strategic relevance in Australia’s sovereign Defence technologies capability,” Coote said.
“The NIOA project builds on our experience in the design, development and integration of critical sub-systems in counter-UAS applications.”
NIOA Australia-New Zealand chief executive officer Ben James said the partnership would combine the companies’ expertise in electronic fuzing and warhead technologies to support Defence capability development.
“NIOA is delighted to partner with Hydrix to bring our collective experience, capacity and industry knowledge on electronic fuzing and warhead technologies to bear in order to provide the men and women of the ADF with sovereign, battle-ready counter UAS capabilities,” James said.
“The onboarding of Australian SME partners to support development of critical technologies is an important step towards establishment of sovereign capabilities to accelerate our asymmetric deterrence.”
Hydrix director of engineering and product delivery Andrew Beal said the engagement reflected growing demand for advanced engineering expertise in Defence applications.
“This engagement demonstrates that Hydrix’s deep technical engineering expertise is highly relevant to mission critical systems supporting Australia’s sovereign Defence capability,” Beal said.
“We are working with Defence clients to deliver complex electronic and embedded systems that meet the performance, reliability and integration requirements for real-world capability deployment.”
Hydrix said the contract is one of several current projects involving advanced electronic technologies for UAS and counter-UAS systems, reflecting broader growth in the sector.
The company cited market forecasts indicating the global counter-UAS market is expected to grow from about US$6.6 billion in 2025 to US$20.3 billion by 2030.
