Can Aurora Labs Overcome Certification Hurdles to Scale Defence Propulsion Manufacturing?
Aurora Labs has advanced its micro gas turbine propulsion program with critical durability testing, a new Defence contract phase, and a strategic $5.5 million capital raise to scale manufacturing and commercialisation.
- Durability testing commenced for AU4 micro turbine engines
- Phase 2 contract awarded by Australian Defence Force worth $450,000
- Pilot batch of 25 engines launched to validate designs and support sales
- Secured $544,333 Defence Industry Development Grant for CNC equipment
- Announced $5.5 million share placement to accelerate commercialisation
Propulsion Development Hits Key Milestones
Aurora Labs Ltd has entered a pivotal stage in its micro gas turbine (MGT) propulsion program, transitioning from development to pre-production. The company has begun rigorous durability testing on its AU4 engines, a crucial step toward military certification. This testing aims to validate thermal management and fuel efficiency under demanding conditions typical of unmanned aerial vehicles (UAVs) and loitering munitions, providing Defence customers with confidence in the engines’ operational reliability.
Alongside this, Aurora achieved a significant design milestone under its Australian Defence Force (ADF) contract, advancing to Phase 2 with a $450,000 award. This phase focuses on refining the novel propulsion system’s design following successful initial bench testing, moving closer to a fully sovereign, 3D-printed propulsion solution tailored for Defence applications.
Manufacturing and Quality Certification Progress
To support its propulsion assembly and scale production, Aurora is upgrading its Canning Vale facilities, including installing new CNC equipment funded by a $544,333 Defence Industry Development Grant. These investments align with the company’s preparation for AS9100D aerospace certification, a rigorous quality standard essential for Defence and aerospace supply chains. Achieving this certification will enable Aurora to supply directly into tier-one Defence contracts and global export markets, enhancing its credibility and operational readiness.
The company has also launched a pilot production batch of 25 micro turbine engines to validate designs, support ongoing durability testing, and seed early sales opportunities. This step marks a transition from prototype to production-grade manufacturing, supported by enhanced quality control and traceability processes.
Strategic Partnerships and Market Engagement
Aurora strengthened its market position by signing a joint integration and distribution agreement with Sovereign Propulsion Systems, aiming to fast-track the integration of its engines into advanced drone platforms. This collaboration not only expands commercialisation pathways but also reinforces Aurora’s role in the sovereign Defence supply chain, particularly within AUKUS markets.
The company showcased its propulsion systems at the Defence and Security Equipment International (DSEI) 2025 event in London, gaining exposure to global Defence primes and UAV integrators. This international presence is expected to catalyse new sales discussions and partnerships, underpinning Aurora’s growth strategy in the Defence sector.
Financial Position and Capital Raise
Financially, Aurora ended the quarter with $447,000 in cash after receiving a $924,000 R&D tax refund and repaying $500,000 in loans. The company maintained disciplined cash management while investing in critical production capabilities. Post-quarter, Aurora announced a $5.5 million share placement at a 26.8% discount to the last closing price, attracting strong institutional and strategic support, including from Sovereign Propulsion Systems.
Proceeds from the placement will accelerate the commercialisation of Aurora’s defence propulsion programs, expand manufacturing capacity, and support working capital needs. This capital injection is a significant step in transitioning from advanced additive manufacturing to full-scale propulsion system manufacturing.
Looking Ahead
In the coming months, Aurora plans to commence AU4 engine durability testing, continue engineering development for the novel engine project’s Phase 2, and undergo its first AS9100D external audit. The company will also finalize CNC equipment installation and operator training, while maintaining active engagement with Defence customers and partners at upcoming events such as the IndoPac Defence Conference.
Bottom Line?
Aurora Labs is poised to transform its propulsion technology from prototype to production, but upcoming certification and shareholder approvals will be critical to sustaining momentum.
Questions in the middle?
- Will Aurora’s AU4 engine durability tests meet the stringent MIL-STD certification requirements?
- How will the collaboration with Sovereign Propulsion Systems impact Aurora’s market penetration and export opportunities?
- What are the risks and timelines associated with achieving AS9100D certification and scaling manufacturing?