Barq Group and US-based Elroy Air have signed an initial agreement to form a joint venture that will invest $200m in a new manufacturing facility in Abu Dhabi to produce the Chaparral autonomous cargo aircraft.

The partnership combines Barq Group, a leading provider of smart mobility and logistics solutions across the MENA region, and Elroy Air, a pioneer in autonomous aerial systems for middle-mile logistics.

Avitrader reports that the proposed facility will manufacture the Chaparral, a hybrid-electric vertical take-off and landing uncrewed aircraft system designed specifically for cargo operations.

Subject to regulatory approvals, the venture will supply Chaparral systems to commercial and humanitarian customers across the Middle East and North Africa.

The venture will also provide aftermarket support, including maintenance, repair, and overhaul services, creating a fully integrated regional capability. Local manufacturing is expected to reduce lead times, improve scalability, and strengthen supply chain reliability amid the growing demand for autonomous logistics solutions in the region.

The Chaparral can carry a 300 lb payload over 300 miles, and its hybrid-electric powertrain allows long-range missions without dependence on charging infrastructure, making it ideal for remote environments. The aircraft completed the world’s first flight of a turbogenerator hybrid-electric aircraft in November 2023.

Ahmed AlMazrui, Chief Executive Officer of Barq Group, described the agreement as “a strategic commitment to Abu Dhabi’s role in shaping the future of mobility. The investment goes beyond manufacturing, supporting the creation of a self-sustaining aerospace ecosystem in the UAE and aligning with the national ‘Make it in the Emirates’ initiative.”

The project also supports Abu Dhabi’s Smart and Autonomous Vehicle Industry cluster and is expected to generate high-value aerospace jobs, develop a regional supply chain, and deliver long-term economic benefits to the UAE.