Ex-GM exec leading EV battery startup’s pivot to defense industry

An Arizona-based battery startup led by a former General Motors executive is pivoting from making products for all-electric vehicles to ones for the aerospace and defense industries amid the war in Iran and growing demand for U.S. drones by the Trump administration.

Sion Power expects to commercialize high-energy lithium-metal battery cells for drones and other defense-related products later this year after focusing on the development of all-electric vehicles for much of the past decade, according to CEO Pamela Fletcher.

“We’re targeting to commercialize this technology,” Fletcher told CNBC exclusively. “We had hoped, and thought, that would be in automotive, and I think that possibility still exists, but the faster path, and frankly, a big need, is out there is in this defense space.”

The decision is a unique example of how companies that bet on the unrealized adoption of all-electric vehicles are pivoting to different segments. Other companies have moved to the stationary storage and aerospace sectors to utilize unused battery production capacity for EVs.

It also comes as automakers in the U.S. have significantly pulled back from pure EVs and taken billions of dollars in write-downs following slower-than-expected adoption of the vehicles and changes by the Trump administration to incentives that supported them.

Sion Power’s planned “Licerion HE” lithium-metal battery cells will support both primary (single-discharge) and secondary (rechargeable) battery applications, according to the company.

The battery cells are designed for next-generation drones, autonomous systems and other mission-critical platforms that require maximum energy in the smallest, lightest possible footprint, according to Fletcher.

“Lithium-metal technology, which is what we developed, has high gravimetric energy, which means it’s a lot of energy in a lightweight pack,” said Fletcher, who began leading the company in 2024. “It works really well for things that fly.”

Fletcher said Sion Power’s lithium-metal cells are engineered to deliver energy densities exceeding 500 watt-hour per kilogram, compared with approximately 300–350 Wh/kg for today’s most advanced lithium-ion technology.

Such batteries can power drones or missiles as well as their on-board systems such as cameras, sensors and processors for combat, surveillance and other needs.  

Sion Power has a 110,000-square-foot facility in Tucson, Arizona, with pilot manufacturing capabilities. Fletcher said it’s currently producing Licerion HE cells for defense applications and converting its production cell line from automotive battery cells to defense products, which are smaller in size.

The company will continue to develop cells for other segments, such as EVs, but its main focus and growth right now is defense, which the company had been working on prior to focusing on EVs, Fletcher said.

Fletcher, a former EV and growth business executive who left GM in 2022, said the opportunity in defense is comparable to the ongoing surge in demand for energy storage from data centers across the U.S.

The privately held company does not plan to be a direct supplier to the U.S. government, but it hopes to sell its products to other certified contractors, Fletcher said. The move comes as the Trump administration’s Department of Defense is exploring increasing production of U.S.-sourced Low‑Cost Uncrewed Combat Aerial System, or LUCAS, drones.

Such drones have been an integral part in the war between Russia and Ukraine as well as the war in Iran.

“It’s evolved quite rapidly in the last three or four years, and now, even with the Iran war, things are changing even further,” Sion Power Chief Commercial Officer Mitch Hourtienne told CNBC. “There’s a lot of emerging applications coming out of, unfortunately, the Ukraine war, now the Iran war.”

Several companies other than Sion Power, such as Quantumscape, have spent years researching and developing lithium-metal batteries for vehicles, but so far there hasn’t been mass commercialization for using that technology in the automotive sector.

Lithium-metal battery cells function similarly to currently used lithium-ion cells, but have greater energy density, potentially at a lower cost. But they can be more volatile and are viewed as farther out than emerging solid-state batteries for cars, according to experts.

Sam Abuelsamid, vice president of market research at communications and consulting firm Telemetry, said lithium-metal cells could be used for different industries and use cases.

“It’s better for energy density. It also should reduce cost,” said Abuelsamid, an engineer and battery expert. “There’s no reason why they wouldn’t be just as effective in smaller objects, especially something that flies, like a drone.”

The biggest difference between defense and automotive is shelf life versus cycle life. Auto batteries typically requires hundreds of charge life cycles, whereas defense uses only require one to 20 cycles and can demand three to eight years of shelf life. 

Sion Power has raised more than $200 million for development of lithium-metal cells. Investors have included South Korean battery manufacturer LG Energy Solution, former Google CEO Eric Schmidt’s family office, Hillspire, and unnamed global automakers, according to the company.

The company, established in 1989 as a spin-off from Brookhaven National Laboratory, plans to seek further capital as its products are expected to launch and ramp-up during the second half of 2026 and into 2027.