US and EU war industry, record orders for 730 billion: The global arms race | Milena Gabanelli

US and EU war industry, record orders for 730 billion: The global arms race | Milena Gabanelli
US and EU war industry, record orders for 730 billion: The global arms race | Milena Gabanelli

During a press conference in November, Pentagon acquisition chief Bill LaPlante holding one hand higher than the other he said: “The global demand for weapons is here, the supply is here.” According to analysts, the West hasn’t had such major military supply obligations since the Korean War. Ten of the world’s largest defense companies currently have order books worth over $730 billion, up approximately 57% compared to the end of 2017, the year in which demand began to grow. Despite this, weapons production cannot keep up with demand. Which is why the West, in particular the European countries that have to renew their war park, by sending weapons to Kiev they risk exposing themselves militarily.

American manufacturers

The latest study of Stockholm International Peace Research Institute (Sipri), shows how the invasion of Ukraine dramatically boosted the purchase of new weapons in Europe (and the amount of weapons imported by European countries has doubled from 2022 compared to the previous five years). US manufacturers are the main beneficiaries with a increase in overall exports by 17 percent. However, manufacturers, both US and European, say the demand is higher than the production capacity. Increasingly high-tech weapons and increasingly expensive assembly lines have slowed down production. Furthermore, Western companies are private and have contracts to respect: if they have to deliver a supply to the Mexican army or Jordan they cannot divert it to Kiev. Let’s take, for example, Lockheed Martin and Rtx – among the major US arms manufacturers, including the Javelins, the Himars and the Patriots, fundamental in the conflict in Ukraine. Both company spokesmen said it would take four years to double production of the Javelin and Stinger surface-to-air missiles – double the expected time. There General Dynamics is accelerating the production of artillery shells to get through from the current 20 thousand per month to 100 thousand. The company’s chief financial officer, Jason Aiken, said during the October 25 earnings call that “the situation in Gaza will only serve to increase upward pressure on this demand».

European factories

“It’s not a joke, we’re in the shit,” he said in an interview with Politico former Belgian deputy defense chief Marc Thys. In his opinion it will take years before Europe is able to produce the weapons and ammunition needed both to help Ukraine and to supply its own armies. Although European companies (including the Italian Leonardo) have seen increase revenues by 10.4% since the start of the war, much of the production capacity, after the fall of the wall, was eroded by the decline in defense budgets and gradual deindustrialization. According to Nicholas Drummond, a defense consultant, German companies could produce up to 400 tanks per year at the height of the Cold War, now capacity has been reduced to 50. And then the use of increasingly sophisticated technologies requires longer production times and costs rise.

Arms race

The CEO of Swedish Saab, Michael Johansson, said that “they are working hard to increase production.” In fact, Saab has expanded not only in Swedenbut also in India and he’s aiming on the USA. There Norwegian Kongsberg is building a second naval attack missile factory, with plans for four production lines. In Francethe Minister of the Armed Forces Sébastien Lecornuduring a visit to the branch French Nexter by Knds, announced that production of Caesar artillery systems, which Paris supplied to Ukraine, increased from two to six per month, with delivery times halved to 15 months. And that France was able to triple ammunition deliveries to Ukraine bringing them to 3,000 bullets per month in January 2024. Instead the Mbda doubled production of Mistral air defense missiles to 40 per month. There German Rheinmetall is booming: in October, it signed a contract with the German army for the supply of more than 150 thousand additional artillery shells, all destined for Ukraine; to increase ammunition production he acquired the company Spanish Expal Systems and made new investments in Hungary. New investments also in Poland for the repair and maintenance of Leopard tanks. The joint venture with the Ukrainian state defense industry for the maintenance and repair of armored vehicles and, in parallel, for the production of the most modern tanks through the transfer of German technologies is very recent. Instead, agreements are being finalized to make Kiev independent in the production of munitions and the development of air defense. But all this, he told lawmakers in Oslo the Norwegian ammunition manufacturer Nammodoes not yet put Europe in a position to help Ukraine defend itself without affecting your safety.

Russia and China: state factories

There is no shortage of supplies in Moscow: production chains were redesigned to evade sanctions. And the complicity of some Western manufacturers in the export of technology is not even ruled out. Factories producing ammunition, vehicles and equipment (all state-owned) they are active 24 hours a dayoften on mandatory 12-hour shifts with double overtime. Putin announced 520 thousand new jobs in the military-industrial complex, which now employs about 3.5 million Russians, or 2.5% of the population. The machinists and welders, according to an investigation by the Moscow Times, now they earn more than many executives and lawyers. Richard Connolly, an expert on the Russian economy and military at the Royal United Services Institute think tank in London, called it a «Kalashnikov economy».

Also In China, large arms manufacturing companies are state-owned, and as in Russia they do what the government asks. China’s giant manufacturing sector has a huge domestic supply chain and numerous graduates trained for the industry. Annual spending on military equipment rose from $26.2 billion in 2010 to $63.5 billion in 2017.. More recent data does not exist, but the four Chinese companies in Sipri’s Top 25 ranking have generated $56.7 billion in arms sales in 2019a figure that placed China in second place behind the United States in that yearclassification global manufacturers. Pulling the strings: the numbers of Western war productions are mostly public, while those supplied by Russia and China have very little that can be verified. The certain fact is that both countries have become the second and third suppliers of African countries respectively. The essence is that we are returning to the law of the strongest. Dante would say: «For me one goes into eternal pain, for me one goes among the lost people…».

 
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