BYD in Formula 1? Defence and drone ambitions at Daimler Truck, Mercedes, and HPQ Silicon

HPQ Silicon is increasingly becoming a drone play

HPQ Silicon is increasingly becoming a drone play. The Canadian technology company announced that its French subsidiary Novacium will present a newly developed Integrated Drone Propulsion System (IDPS) at the Eurosatory 2026 defence and security trade show. Together with partners LN Innov' and Groupe Zekat, a propulsion solution developed entirely in Europe is being created that combines battery technology, electric motors, and intelligent control electronics into a single system. This is an important step for HPQ, as Novacium is showcasing its silicon-enhanced lithium-ion batteries, which enable higher energy densities while remaining compatible with existing production processes. According to HPQ, the latest battery generation achieved energy values of over 7,000 mAh, making it one of the highest results reported to date. In tests, the HPQ product outperformed conventional drone batteries with a performance increase of 23% to 36%.

Novacium's new project is of strategic importance. In light of geopolitical tensions and the growing importance of technological sovereignty, numerous countries and companies are seeking European alternatives to international supply chains. The new drone propulsion system was developed and manufactured entirely in France. As a result, it addresses key requirements of modern drone operators: high performance, security of supply, and independence from foreign suppliers. The presentation at Eurosatory offers Novacium and HPQ the opportunity to engage directly with potential customers from the defence, security, and industrial sectors and to advance the commercialization of the technology.

For HPQ, this opens up an additional growth path alongside its existing activities in battery materials and hydrogen technologies. On the stock market, the company is still valued at a modest CAD 75.5 million.

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Is BYD Spreading Itself Too Thin?

While the Chinese electric vehicle manufacturer is in the midst of a price war in its home market, it is pursuing several ambitious projects abroad. While sales in Europe are still lagging behind its own targets, the plant in Turkey is sparking debate. Although the planned factory is considered a key component of the European growth strategy, its construction is taking place in a challenging environment. Challenges related to permits, supply chains, and ramping up new production capacity are typical risks associated with such large-scale projects.

The company recently garnered additional attention due to speculation about a possible involvement in Formula 1. There has been no official confirmation so far, yet such rumours continue to be discussed. An entry into the premier class of motorsports could further boost global brand awareness and demonstrate technological expertise. At the same time, such a project would tie up significant financial and human resources. Critics therefore question whether a potential foray into Formula 1 currently aligns with the strategic priorities of a company that is simultaneously seeking to establish itself in numerous international markets.

Added to this is the planned development of its own fast-charging network in Europe. With a high-performance charging infrastructure, BYD could enhance the appeal of its vehicles and reduce its dependence on third-party providers. However, expanding a Europe-wide network is complex and would likely cost billions.

In any case, BYD shares are not benefiting from these plans. So far this year, it has lost 7.4% of its value. Over the past 52 weeks, the decline has even exceeded 20%.

Daimler Truck and Mercedes Want a Piece of the Defence Pie

While HPQ is emerging as a new drone play, Daimler Truck could become a notable defence play. The company announced yesterday that it intends to significantly expand its defence business and, to that end, consolidate its global activities under the new umbrella brand "Daimler Truck Defence." The company plans to gradually expand its product range—which has so far focused primarily on Mercedes-Benz trucks—to include additional vehicle portfolios and brands within the group. To support this growth, development, production, sales, and service capacities are to be expanded in the coming years. Investments in the mid-to-high three-digit million-euro range are planned for this purpose.

The commercial vehicle manufacturer views the defence segment as an important strategic growth area and aims to achieve revenue of EUR 1 billion in this sector by 2028. The expansion is also expected to positively impact employment, particularly at the Wörth am Rhein site. In addition, Daimler Truck is focusing on international partnerships, leveraging its global production and service networks, and expanding its portfolio of military logistics and mobility solutions for armed forces worldwide.

In line with this, the Mercedes-Benz Group is also advancing its activities in the security and defence sector. At the ILA 2026 air show, Mercedes-Benz signed a memorandum of understanding with the Munich-based technology company TYTAN Technologies. The aim of the collaboration is the development and potential industrial-scale deployment of mobile security and defence solutions that link vehicle platforms to drone, sensor, and mission systems. At the show, the partners presented an initial prototype of a vehicle-based network system.

The partnership demonstrates that Mercedes-Benz now views the defence business as a strategic growth area. Board member Michael Schiebe emphasized that Mercedes-Benz contributes robust base vehicles, while TYTAN possesses expertise in drones, sensors, and defence systems against unmanned aerial vehicles. Together, they aim to develop innovative solutions for protection and security tasks. Against the backdrop of Daimler Truck's announced billion-euro push into the defence segment, the partnership underscores that the entire group is increasingly focusing on the growing demand for military mobility and modern defence technologies.

The latest news confirms that HPQ is increasingly becoming a drone play. The stock should also benefit from this soon. BYD has been under pressure for some time. Although the company has grown into the world's largest electric vehicle manufacturer, this has not translated into meaningful gains for shareholders for quite some time. The expansion of Daimler Truck and Mercedes is likely the right move, but especially for Mercedes, this is unlikely to have any impact on the company's performance for quite some time.