The US Navy will no longer buy a highly prized — but ultimately troubled — drone speedboat manufactured by Aevex Corp.’s BlackSea after already spending more than $130 million on the technology, according to people briefed on the matter.

Additional purchases of the global autonomous reconnaissance crafts, or GARCs, were suspended due to ongoing performance issues related to limitations to the hardware and the emergence of more suitable alternatives, including cheaper one-way attack drones, according to one of the people, who asked not to be identified discussing private matters. The decision came after the Navy program office that works on the platform commissioned an independent assessment, the person said.

The decision, which was made earlier this fall, demonstrates the uneven reality underpinning the Pentagon’s ambitions to advance drone warfare and remodel the future of war around unmanned systems. It’s asking Congress for $54 billion to scale autonomous systems in next year’s fiscal budget. The halt also represents a setback for Aevex, which in September bought GARC manufacturer BlackSea Technologies for as much as $650 million. The firm has said it’s delivered more than 300 of the unmanned surface vessels to the Navy.

Shares of Aevex sank as much as 7.5% on the news in late trading, before settling back near their closing price on Tuesday.

Aevex Maritime Systems, the unit now responsible for the GARCs, continues to respond to the military’s needs, an Aevex spokesperson said. GARC platforms have accumulated more than 25,000 hours of on-water operations, are deployed with multiple fleets and unmanned task forces and continue to execute missions for the US Navy, the spokesperson said.

A spokesperson for the Navy said it has spent $136.8 million to date on 24 prototypes and 301 GARCs but didn’t comment on the decision to cease more purchases or the challenges associated with boat. The Navy has gained practical experience from GARC deployment for training, exercises and operations, the spokesperson said, adding that this knowledge is helping the Navy accelerate robotic and autonomous systems capabilities.

Aevex Maritime Systems is planning to upgrade existing GARC platforms to improve resiliency, one of the people briefed on the matter said. The company, which has described the GARC as “the most proven” small unmanned surface vehicle, is also planning other, larger platforms, the person said.

GARCs are 16-foot (5-meter) boats that can carry explosives and engage in high-speed autonomous maritime combat operations. The Navy has regularly touted them in NATO exercises and in promotional materials. A July video shows an attack by multiple armed GARCs against a decommissioned ship. They were also used during maritime patrols in support of the US military’s major combat operations against Iran earlier this year.

The GARC’s performance in testing over time has been viewed as a failure and the Navy has moved on, said a defense official familiar with the platform who asked not to be identified speaking unofficially on the matter and noted problems with the hardware, software and sensors.

In one previously reported example from a 2025 test session, a GARC switched into autonomous mode and capsized the captain of a towboat that had been pulling it out to sea.

The defense official said the failure doesn’t signal the end of US efforts to foster drone warfare at sea, citing successful autonomous maritime platforms developed by firms such as Saronic Technologies Inc. It also doesn’t mean the end of the Pentagon’s relationship with Aevex, the official said, pointing to the company’s ability to leverage its experience with GARC and add investment capital to support the development of new platforms for the Navy.

BlackSea was among three winners this month of a Navy prize challenge for its demonstrations in finding and destroying mines using autonomous technology, separate from the GARC.

More broadly, defense tech startups are often over-promising and then scrambling to raise capital, secure equipment and hire the workforce necessary to deliver working platforms, the defense official said.

On Tuesday, GARC was still listed as one of the surface warfare programs under the Navy’s new effort on robotic and autonomous systems that was established to speed adoption.

Aevex’s takeover of BlackSea was closed around the same time that the Navy decided to discontinue its investment in purchasing GARCs. The Aevex spokesperson didn’t say whether the company was aware of the Navy’s decision to halt new purchases of GARCs at the time of the acquisition’s completion.

The system has already helped Navy teams command vessels beyond their own sightlines. BlackSea previously said its drone speedboat could be useful for reconnaissance missions, anti-submarine warfare, delivering strikes in surface combat and in mine countermeasures. By 2025, the Baltimore shipyard’s production line was producing a GARC a day. At slow speeds, it can traverse as many as 1,600 nautical miles (3,000 kilometers), according to the manufacturer.

US Central Command, the combatant command known as Centcom responsible for carrying out combat operations against Iran, has also used other drone boats during Operation Epic Fury, including Corsair unmanned maritime platforms from Saronic.

In one case, a boat from Saronic rescued two downed Army helicopter pilots in June. In another, the US in July released footage of uncrewed Saronic drone vessels ramming and exploding into an Iranian pier, describing it as the first time the US forces have used sea drones in combat operations.

“As a ‘battle lab,’ Centcom fields a variety of emerging technologies as we equip warfighters with cutting-edge innovations,” Timothy Hawkins, a spokesperson for the Centcom, told Bloomberg, without directly responding to questions about the GARC. “Sometimes the new tech works and sometimes it doesn’t, but that’s the point. It’s about putting the latest systems in the hands of our troops and rapidly learning through real-world employment.”