The steady hum of a propeller breaks the silence of the hot Mojave Desert as a General Atomics Aeronautical Systems Predator B unmanned air vehicle (UAV) accelerates and climbs into the air.

Followed by a chase aircraft, the UAV turns north and the silence returns, only to be broken again moments later as another Predator B lands.

Privately-owned General Atomics tells Flightglobal the bustling activity at its test and training facility near Palmdale, California, reflects financial health and continued demand for Reaper.

But conscious of the US Air Force’s plan to stop buying the aircraft after fiscal year 2019, General Atomics is not betting its future on the US military.

The company is investing internal funds on products it hopes will compensate for waning sales, including Predator derivatives aimed at foreign military sales (FMS).

It also hopes to win a contract to build the US Navy’s unmanned carrier-launched airborne surveillance and strike (UCLASS) system, and has ideas about designing a new, larger UAV.

From his office at the company’s headquarters near San Diego, David Alexander, senior vice president of engineering and aircraft systems, tells Flightglobal that foreign sales are key to continued success.

“As long as we go forward with these plans, and backfill [US military orders] with the FMS market, then I think we are solid. I think the future is bright,” he says.

But a changing US military strategy and budget cuts are forcing the company’s hand.

“The problem is that the mission is changing,” says Larry Dickerson, senior defense analyst at Forecast International Dickerson.

USAF officials say that in future years the service will focus more on conventional warfare and less on the counter-insurgency missions in which medium-altitude long-endurance (MALE) UAVs such as Reaper excel.

“We are seeing some near-term pressure on [General Atomics’] programmes,” says Phil Finnegan, director, corporate analysis at the Teal Group consultancy. “This is a time of transition. It promises to be challenging.”

The USAF plans to buy 12 Reapers and the US Army plans to buy 19 MQ-1C Gray Eagles, a derivative of the earlier MQ-1 Predator, in fiscal year 2015, according to the military’s recently-released budget proposal.

But under the plan, army purchases will end in fiscal year 2016 and USAF orders will range between 11 to 22 Reapers annually before ending after 2019.

Though the budget requires Congressional approval, Dickerson says lawmakers may be wary to spend more money on UAVs such as the Reaper, especially considering the escalating cost of the Lockheed Martin F-35 programme.

“So far, it's not clear unmanned vehicles can fight with the big boys for money,” he says.

The pullback comes as the military’s strategy evolves.

In late March, USAF chief of staff Gen Mark Welsh told attendees at a conference in Washington, DC, that the service will increasingly focus on large conflicts against technologically-advanced adversaries.

“Super powers… have air forces to fight a full-spectrum, high-end fight,” he said. “We are optimising to be able to do that.”

As part of its cost-cutting, US Defense Secretary Chuck Hagel said in March the USAF will reduce its goal of 65 continuous Predator and Reaper orbits to 55, and transition to an all-Reaper fleet.

He added that the USAF’s armed UAVs are effective against insurgents and terrorists, but “cannot operate in the face of enemy aircraft and modern air defences”.

Still, Alexander insists UAVs such as the Reaper can play a crucial role in future battles in contested airspace.

He says the aircraft can perform persistent intelligence, surveillance and reconnaissance (ISR) as part of an integrated air mission, allowing the USAF to reserve more expensive assets like Lockheed Martin F-22s and F-35s for deep strikes and air-to-air combat.

“There are phases of a campaign where this airplane is perfect, you just have to put the right pods underneath the wings for electronic warfare and self protection,” Alexander says. “We are… pushing the idea and I think it is catching on.”

Reapers, including weapons systems, will cost roughly $20 million each in fiscal year 2015, while F-35s will cost nearly $150 million, according to USAF budget documents.

“Airplanes that cost way too much money – you don’t want to use them as much,” he says. “There is something to be said for affordable quantities.”

Alexander’s office bears witness to the evolution of General Atomics and its products.

On one table sits new landing gear components for an improved version of the Reaper, while the twisted, jagged shell of a Hellfire missile, fired from a Predator during early missile tests, rests on the window sill.

The aircraft’s roots stretch back to 1994, when Naval Air Systems Command awarded General Atomics a contract to build the Predator.

Though Predators flew combat missions during the Balkan campaign in the 1990s and later in Afghanistan, the military fully realised their value following the 2003 invasion of Iraq, says Dickerson.

Unable to commit hundreds of thousands of troops to secure sprawling cities like Baghdad, the US military turned to UAVs such as the Predator, which could loiter overhead for hours, tracking insurgents’ movements, he says.

With a 55ft (17m) wingspan and a Rotax engine, Predators have a 1,157kg (2,550lb) gross take-off weight and can carry 204kg internally and 136kg externally, according to General Atomics.

They are controlled using C-band radio communications within roughly 150 miles and by Ku-band satellite links at greater distances, and can fly for 40h at altitudes of up to 25,000ft and speeds up to 120kt (222km/h).

Predators perform their ISR mission using electro-optical and infrared (EO/IR) sensors, a signals intelligence (SIGINT) system and General Atomics’ Lynx multimode radar with synthetic aperture radar (SAR). The aircraft can also be fitted to carry two Hellfire missiles.

Predator orders hovered between 15 and 30 aircraft a year during the early part of the 2000s, and in fiscal year 2007 the USAF began buying the larger, more capable MQ-9 Reaper, according to budget documents.

With a Honeywell TPE331-10 turboprop and a 20m wingspan, Reapers can reach 50,000ft and fly for 27h at up to 240kt, says General Atomics.

Payloads typically include four Hellfires on the wings and two bombs internally, the company adds.

Around 2006, the army began buying Gray Eagles, which are powered by a diesel-burning Thielert engine and carry EO/IR sensors and up to four Hellfires.

Additional US buyers have included NASA and US Customs and Border Protection. Alexander says the US Marines are also considering an order.

In addition, General Atomics has sold aircraft to NATO partners the United Kingdom, Italy and France.

The Netherlands also has plans to acquire Reapers.

“Those are breakthroughs because in the past, those countries relied on Israeli technology,” says Finnegan.

In February 2013, General Atomics also signed a $197 million deal to sell Predator XPs the United Arab Emirates, the first non-NATO country to receive a version of the aircraft.

Predator XPs do not carry weapons and have modifications that allow them to qualify under the Missile Technology Control Regime’s less restrictive category II export requirements.

Sales hit a high point around fiscal year 2011, when the US military bought 87 Reapers and Gray Eagles, according to budget documents.

The following fiscal year, US spending on the Reaper and Gray Eagle, including research and development, reached about $2.1 billion.

Alexander says Reaper and Gray Eagle sales account for roughly 80% of the company’s business.

“General Atomics was in the right place at the right time with the right system,” says Dickerson. “The war was the thing that really made them into a multibillion [dollar] company.”

“They were in a position that was really envied by a lot of air and space companies,” adds Finnegan.

But with US military sales waning, General Atomics is now following a strategy Alexander says has worked before: investing private money into promising new products.

That strategy may not seem novel, but Alexander says private ownership allows the company to invest “huge” amounts of money into internal research and development (IRAD) projects without deference to board members or stockholders.

“Without [private investment], I just think we would be riding the wave of some opportunity, like the war on terror, and not be able to come out on the other side,” he says.

Towards that end, General Atomics is developing a longer-endurance "Block 5" version of the Predator B.

The first phase of the project includes adding fuel pods onto Predator B’s hardpoints.

Then, the company will move that fuel into a new wing with a 24m span, says Alexander.

The company is also giving Predator B new landing gear, improved security with a secure digital data link and power generation of 45kVA, he adds.

With the changes, the aircraft will have a higher gross take-off weight and an endurance of 42h, says Alexander.

“This is becoming quite the pick-up truck of the future for carrying payloads at a very affordable price,” he says.

General Atomics is also developing its Block 50 ground control station.

A major upgrade, the system provides more secure connectivity and has six high-definition touchscreens that wrap around the operator and provide synthetic video of the aircraft’s surroundings, says General Atomics.

The project received a major boost in recent weeks when the USAF announced it had granted General Atomics a $141 million contract for the Block 50 system.

But General Atomics says its future lies largely overseas.

The company has embarked on a major effort to make the Block 5 version of Predator B compliant with a NATO standardisation agreement (STANAG) for UAVs, says Alexander.

The project includes changes to software and upgrades designed to make Predator B more attractive to NATO countries.

General Atomics says the aircraft will have improved fatigue and damage tolerance and be certificated to operate in more adverse weather such as icing conditions, as well as being able to survive bird and lightning strikes.

“If we can provide all that in a [certificated] package, [NATO customers will] be buying them left and right. That’s the plan,” Alexander says.

He adds that the company also hopes to sell Predators to Latin America countries and other nations in the Middle East.

Finnegan says the strategy makes sense.

His company estimates that 828 MALE UAVs will be built between 2013 and 2022, representing roughly one-third of worldwide military UAV sales.

“It’s a very desirable area to be in,” he says.

But foreign sales are not assured, Finnegan adds, noting that General Atomics competes with Israel Aerospace Industries, maker of the Heron and Heron TP, and Elbit Systems, which makes the Hermes 900 UAV.

General Atomics says overseas sales are just part of its strategy.

Technicians were recently working on the landing gear of a Predator C “Avenger” inside a hanger at the company’s desert test site.

The sleek aircraft, powered by a Pratt & Whitney PW545B turbofan, can reach altitudes of 50,000ft, fly for 18h and reach maximum airspeed of 400kt.

Avengers have a gross take-off weight of 8,255kg and payload capacity of 2,948kg, including 1,588kg internally, the company says.

Its payload can include Hellfire missiles, joint direct attack munitions, Lynx multimode radar, signals intelligence and EO/IR, says General Atomics.

Alexander notes that the company is also making upgrades that will bring Avenger’s gross take-off weight to 8,618kg and its endurance to 20h.

General Atomics has built four Avengers, and production continues at the rate of one aircraft every nine months.

“They are going places,” Alexander says, adding that the buyer is classified.

In addition to Avenger, General Atomics is developing a derivative of that aircraft for the US Navy’s UCLASS programme, which calls for a stealthy UAV that can operate from navy ships.

On 17 April the service announced that it had released a draft request for proposal (RFP) for the programme to four bidders: General Atomics, Boeing, Lockheed Martin and Northrop Grumman.

The RFP is not publicly available, but first flight is scheduled for the third quarter of fiscal year 2018.

In its recent budget proposal, the US Navy outlined a plan to spend $2.67 billion on the project until fiscal year 2019.

“The Navy doesn’t do anything small. This is a big, big programme,” Alexander says. “If we win, that will [define] what we are doing for the future.”

If General Atomics does not win, the company may turn its attention to another, new UAV, he says.

That aircraft has yet to be fully defined, but Alexander says it is likely to be larger than its predecessors.

”Every model we have come out with has weighed more than the last one. They keep getting bigger,” he says.