Defense Business Brief: Farnborough preview; House passes NDAA; SECDEF Wants CHIPS; and more.
Airport meltdowns, rapidly rising COVID-19 cases, and a scorching heat wave be damned, tens of thousands from across the aerospace and defense industry will be in England next week as the Farnborough Air Show returns for the first time since 2018.
Yes, there have been airshows in Dubai and other parts of the world since the coronavirus canceled Farnborough in 2020 (and the Paris Air Show in 2021), but this is the first show where a large U.S. government delegation is expected.
Farnborough returns as the United States and its allies respond to Russia’s invasion of a European neighbor. Some NATO members are pledging defense spending increases; Finland and Sweden are in the process of joining the alliance. All the while, the U.S. is redoubling efforts to persuade other militaries to give up Soviet and Russian-made weapons in favor of Western arms.
The air show organizers banned Russia from participating at Farnborough this year. Typically, Russian firms showcase commercial airliners at Farnborough, though there are typically models of MiG and Sukhoi jet fighters in the exhibit hall.
While these airshows usually have a heavy commercial aerospace focus, the current security situation in Europe and increasing emphasis by the alliance on China’s military buildup should provide a new flavor to this year’s show.
At the Paris Air Show in 2019, European nations were talking about jointly developing hypersonic weapons and next-generation stealth fighters. Expect to get updates about these efforts.
Of note, the airshow this year comes the week before the large U.S. defense firms report second-quarter earnings. Since companies are in the so-called “quiet period,” major company announcements are not expected.
What else will we be watching? It’s the coming-out party for new Boeing defense CEO Ted Colbert. He comes to Europe at a time when Boeing is struggling to deliver commercial planes, the lifeblood of the company.
We’re likely to hear about ideas companies have for selling to European allies. Also, expecting to hear more about the supply-chain and workforce issues that have bedeviled the industry in recent years.
Back stateside, the House on Thursday approved the NDAA, which adds $37 billion to the Biden administration’s proposal. It’s the second straight year that Congress, which is controlled by Democrats, has recommended increasing Biden's military budget plans.
Lawmakers added $58 billion to the Pentagon’s current budget, according to a new, congressionally mandated Defense Department report. Roll Call first reported the existence of the report, which has been posted unceremoniously on the Pentagon comptroller website.
Defense Secretary Lloyd Austin called on Congress to approve the Bipartisan Innovation Act and fund the Creating Helpful Incentives to Produce Semiconductors part of the legislation, known as the CHIPS act. The measure would incentivize companies to produce much-in-demand semiconductors. Lawmakers could vote specifically on the CHIPS portion of the legislation as soon as Tuesday, Reuters reports.
Meanwhile, the Aerospace Industry Association wants lawmakers to delay implementation of a law that would get rid of tax breaks companies receive for research-and-development work.
The U.S. Air Force and Lockheed Martin said they have successfully completed a test of the Air-Launched Rapid Response Weapon this week. “The AGM-183A weapon system reached hypersonic speeds and primary and secondary objectives were met,” the Air Force said. The missile also flew successfully in May.
And finally, defense startup Anduril announced it would open a $60 million manufacturing and research facility in Atlanta. The company will create 180 jobs over the next three years. “Anduril’s new Atlanta office will be home to Area-I, a Georgia-based manufacturer of advanced unmanned aircraft systems. Anduril acquired Area-I in 2021,” according to an announcement from Georgia Gov. Brian Kemp.
- Lockheed Martin has named retired Marine Corps lieutenant general and former Defense Intelligence Agency director Vince Stewart, to its board of directors.
- Shon Manasco, a former assistant Air Force secretary for manpower and reserve affairs, has joined software firm Palantir as senior counselor. He will focus on air, space, and international government work.
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