With the U.S. defense budget totaling approximately $850 billion, the group aims to capture a larger share of this funding.

Palantir and Anduril, two prominent defense technology companies, are in discussions with major firms like SpaceX and OpenAI to establish a large consortium aimed at securing government contracts.

This consortium seeks to harness the technological prowess of Silicon Valley to bolster U.S. defense capabilities.

Palantir, co-founded by Peter Thiel, has a successful track record of securing government contracts, including a recent $480 million deal with the Pentagon.

The consortium aims to provide the U.S. government with cutting-edge technology and weapons in a more efficient manner.

Palantir's stock has surged by 300% over the past year, reflecting its growing influence in the defense sector and surpassing Lockheed Martin in market capitalization.

Initial partnerships from this consortium are expected to be announced as early as January 2025, with an official announcement planned for January 2024.

Musk and other smaller defense tech firms are pushing for the adoption of cost-effective, AI-driven technologies, criticizing existing programs like the F-35 fighter jet.

The initiative is designed to disrupt the traditional defense contracting landscape, which has been dominated by established players such as Lockheed Martin and Boeing.

Elon Musk, who has been appointed to co-lead the efficiency drive, has raised concerns about Pentagon spending and is advocating for innovative technologies over traditional defense programs.

The push for collaboration between large defense contractors and smaller tech firms aligns with President-elect Donald Trump's government efficiency initiative.

The demand for technology companies in the defense sector has surged due to ongoing international conflicts and rising geopolitical tensions.