Booming demand for weapon systems in Europe: U.S. weapon manufacturers

The surge in demand for U.S. weapon systems is despite EU-US trade tensions. The demand rides on the back of geo-political moves made by Russia and Iran.

With growing security concerns coming from Russia and Iran, U.S. weapon manufacturers see a rise in demand for weapons, including missiles and fighter jets from Europe.

The U.S. government had sent a group of high-ranking officials including Commerce Secretary Wilbur Ross to the Paris Airshow where nearly four hundred U.S. companies showcased their equipment.

Top weapons manufacturers, such as Lockheed Martin, Boeing and other see an acceleration in demand for U.S. weapons in Europe despite trade escalations between Europe and the United States.

“Two Paris air shows ago, there weren’t a lot of orders,” said Rick Edwards, who heads Lockheed’s international division. “Now … our fastest growth market for Lockheed Martin in the world is Europe.”

Ever since Russia annexed Crimea in 2014, many European nations have increased their military spending and have bolstered their missile defenses, and even upgraded or replaced their ageing fighter jets.

In 2014, NATO members agreed to increase their defense spending to 2% of their gross domestic product.

According to Eric Fanning, the CEO of the Aerospace Industries Association, the NATO pledge and European concerns about Russia were fueling demand.

“I do think it reflects the increasing provocations of Russia,” said Fanning.

Another growing concern is Iran’s missile development program. Tehran’s latest move to shoot down a U.S. drone last week only fuels this demand.

“Iran is our best business development partner. Every time they do something like this, it heightens awareness of the threat,” said a senior defence industry executive on the condition of anonymity.

Lockheed’s F-35 stealth fighter, which has been selected by Belgium, is poised to win orders from Poland; Bulgaria, Romania and Slovakia are also working to replace Soviet-era equipment.

According to top executives from weapon manufacturers, they don’t see any impact from the ongoing trade disputes between the United States and the EU.

According to U.S. Army Lieutenant General Charles Hooper, director of the Pentagon’s Defense Security Cooperation Agency (DSCA), Europe accounted for nearly a quarter of the $55.7 billion in foreign arms sales the DSCA handled in 2017-2018.

The Trump administration is making concerted efforts to speed arms sales approvals and boost weapon sales to help U.S. allies.

“Europe is really big for us now, and that’s a big change in just the last few years and even the last 18 months,” he said.

In addition to wooing new customers, Raytheon is upgrading existing anti-missile systems, such as Patriot, for customers like Germany, which is likely to finalize a contract worth potentially hundreds of millions of dollars in the coming months.

According to Thomas Breckenridge, head of international sales for Boeing’s strike, surveillance and mobility programs, Germany, Switzerland and Finland could place contracts for Boeing’s F/A-18 Super Hornet fighter.

“There’s a huge appetite in Europe for defense as a whole,” said Breckenridge.

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