“His opponents’ victory could become a defeat for Ukraine”. How the defence tech market is reacting to Mykhailo Fedorov’s resignation

The conflict between Commander-in-Chief of the Armed Forces of Ukraine Oleksandr Syrskyi and Minister of Defence Mykhailo Fedorov has become public. As a result, Fedorov will not be part of the new government being formed following the resignation of Yuliia Svyrydenko’s Cabinet.

Fedorov’s dismissal triggered protests in various Ukrainian cities on 16 July. On that day, he also held a press conference at which he spoke about the achievements of his six months in office and outlined the essence of the conflict with Syrskyi.

Defender Media attended Fedorov’s press conference and also asked representatives of the Ukrainian defence tech sector to assess the minister’s resignation, its impact on the market and the course of the war.

Reason for dismissal – conflict with Syrskyi

On 16 July, the composition of Ukraine’s Cabinet of Ministers changed. Instead of Yuliia Svyrydenko’s government, which the Verkhovna Rada dismissed on 14 July, parliament today voted for a new Prime Minister, Serhii Koretskyi, and the candidates he proposed.

At the same time, the biggest surprise, which ultimately led to protests, was the absence of Mykhailo Fedorov from the list of candidates. Ihor Klymenko, the Minister of Internal Affairs, was reportedly set to head the Ministry of Defence instead. Volodymyr Zelensky confirmed that Klymenko was a candidate, but did not submit him for parliament’s consideration.

In the end, following Fedorov’s dismissal, Yevhen Khmara was appointed acting minister. He previously headed the SSU’s Special Operations Centre A and served as acting head of the Security Service. Zelensky stated that he would later propose to MPs that Khmara be appointed defence minister in full.

Volodymyr Zelensky stated that the reason for Fedorov’s dismissal was the lack of effective communication between the ministry and the army’s leadership, Ukrinform reports. According to the president, the parties failed to find common ground and did not speak to each other without Zelensky present.

During the press conference, Fedorov stated that the General Staff had blocked the ministry’s initiatives and that Oleksandr Syrskyi had not been willing to talk. For example, the Ministry of Defence had been unable to change its organisational structure because the General Staff had allegedly not approved the change.

One of the contentious issues is corruption in procurement. According to Fedorov, the Ministry of Defence launched a new data-driven procurement system. At the same time, there were people at the ministry who had been placed there by certain market players. The ministry proposed buying from the top 10 companies popular among the military. As a result, the new procedures “broke the business strategies of some companies”.

Resist.UA founder Roman Sulzhyk says that a significant share of Ukraine’s defence procurement is still conducted “the old way” – through opaque practices that have developed over decades. At the same time, a parallel procurement track based on transparent procedures and objective data has emerged.

According to Sulzhyk, Fedorov sought to push this second approach as far as possible, bringing him into conflict with representatives of the old system. “At the moment, it looks like his opponents have won. But their tactical victory could become Ukraine’s strategic defeat,” the investor warns.

According to Fedorov, Syrskyi was one of those who saved Ukraine in 2022. But the war is changing and requires new approaches, which the commander-in-chief was blocking.

On his Telegram channel, Syrskyi thanked Fedorov for his work as defence minister. He also added: “I am proud that, thanks to the Kyiv defensive operation in 2022, we managed to defend our capital. And now this city can host briefings, shape visions and make decisions.”

Now, according to Syrskyi, the focus needs to be on the war and on an effective strategy that is currently delivering concrete results.

Zelensky stated that Fedorov will remain part of his team following his dismissal. According to the former minister, the president offered him the position of advisor, but Fedorov is not inspired by that prospect. At the same time, he does not see himself as defence minister if Syrskyi remains commander-in-chief.

What do manufacturers think about the defence minister’s dismissal

Fedorov’s dismissal and his absence from the new government ultimately led to rallies in several cities. COO of Kara Dag Technologies Andrew Poberezhniuk believes the public reaction is understandable: “Many people associate the recent successes of Ukrainian defence tech, the scaling-up of drone production and the digitalisation of processes precisely with Fedorov’s team. So the question arises: why change something that is working?”

“A minister needs to work for at least one budget year to show results. Only then can their work be assessed objectively,” comments a representative of a Ukrainian defence tech company who wished to remain anonymous. Many UGV manufacturers also consider replacing Fedorov now to be one of the biggest mistakes, says CEO of Tencore Maksym Vasylchenko.

According to him, the replacement would be understandable if there were no results. But there are results, and the industry sees them. He names speed as this minister’s advantage – work on set goals often began right after a handshake.

Summarising the results of his work, Fedorov highlighted the disconnection of Starlink for Russians, the launch of the “Logistics Lockdown”, the introduction of 70% prepayment for procurement, the increase in the interception rate of drones from 83% to 91%, and of cruise missiles from 47% to 87%, among other achievements.

At the same time, Zelensky believes the minister failed on the Territorial Recruitment Centre reform, MP Yaroslav Zhelezniak wrote. Contract reform and new payments for the Armed Forces of Ukraine were also criticised by some service members.

A top manager at one defence company says he would not share the general sentiment about Fedorov’s supposed super-efficiency. As an example, he cites the statement about a radical overhaul of the procurement system. He says the procurement carried out by the DPA does not differ in any way from the procedures used last year. At the same time, he adds that there is an impression of a young, well-intentioned team, and that Ukraine needs innovation in the war.

Poberezhniuk of Kara Dag finally adds that the state system should be stronger than individuals. In his view, the best proof that the change of minister was the right one will be whether the pace of the industry’s development is maintained or accelerated.

How Fedorov’s dismissal will affect the defence tech market

According to a top manager at a major manufacturer, any change of minister harms all defence tech companies. Founder of Unwave Yurii Shelmuk says that in such a case, the ministry’s work will grind to a halt: “Any new team needs to form its own team again, analyse and initiate processes.”

The approvals and criticality confirmations initiated by the Ministry of Defence and due by September, current projects on mid-strikes and “short-range” air defence, and the controlled export process will all remain in question. “One action, and immediately a large list of unknowns, while we have to plan production. A lack of understanding is the worst thing for the industry,” says Shelmuk.

CEO of the Ukrainian Council of Defence Industry Ihor Fedirko adds that the new minister will almost certainly start replacing deputies and department heads, and revisiting decisions that have already been made. This, in turn, represents a colossal amount of work that will take time.

At the same time, a representative of another major manufacturer explains that he sees no near-term risks – the DPA and the military are working, and the main processes are moving forward. He does not believe that all technological progress will stop without Fedorov.

But the dismissal will have a negative psychological effect on the market and the army, as such treatment of a progressive and prominent manager demotivates many. CEO of Motor-G Oleksii Grebin believes that under Fedorov, the ministry gained a vision and a mission, on which key indicators and goals were built. According to him, without these rules and the visionary who promotes them, the system will not survive for long and will revert to its previous settings.

An anonymous manufacturer also notes that the country is losing valuable personnel, such as Pavlo Yelizarov, Serhii Beskrestnov and Serhii Sternenko. The latter two were advisors to Fedorov and have already announced that they are leaving these positions.

Pavlo Yelizarov is the founder of the Lasar’s Group special unmanned aerial systems unit, which is regarded as one of the most effective in the Defence Forces. In early 2026, he was appointed Deputy Commander of the Air Force responsible for the development of “short-range” air defence. Following Fedorov’s dismissal, Yelizarov filed a resignation report. He named Fedorov’s dismissal as the reason.

Defender Media will continue to monitor developments.