January 29, 2023

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U.S. arms companies have had the greatest success in the conflict in Ukraine

U.S. arms companies have had the greatest success in the conflict in Ukraine

While US arms manufacturers have not received direct benefits from the thousands of missiles, drones and other weapons shipped to Ukraine, they are preparing to make large profits in the long run by supplying weapons to countries that want to strengthen their defenses against Russia.

Filling stocks to revive the industry

Like other Western nations, the United States used its reserves to supply Ukraine with shoulder-to-shoulder Stinger and Javelin missiles. The price of these weapons was recently paid to Lockheed Martin and Radeon Technologies.

But after a portion is allocated to Kiev, the shortfall in US military stock must be filled.

A ministry spokesman said in mid-March that the US Department of Defense (Pentagon) had approved a $ 3.5 billion spending bill for this purpose, according to Agence France-Presse. Production of the latter “Stinger” anti-aircraft missile was suspended until the Pentagon demanded $ 340 million in new modules last summer.

“We are looking at deficiencies in US reserves and options to fill any gaps in our partners ‘and partners’ deficits,” the spokesman said.

He added, “It will take time to upgrade the industrial base, for key suppliers and subsidiaries – to be able to restart production.”

Billions in profits

Defense experts told AFP that the companies’ profits from these missiles, which are known to be easy to use, would not be large.

“If 1,000 stingers and 1,000 darts were shipped each month to Eastern Europe for use next year, this would be unthinkable at current speeds, equivalent to $ 1-2 billion in revenue for program makers,” said Colin Scrola. Sira, an investment research firm.

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But that figure is very small compared to “Radeon” and “Lockheed Martin” revenues announced last year, at $ 64 billion and $ 67 billion, respectively.

When the chief executives of some arms manufacturers released their quarterly results at the end of last January, they pointed out that the world situation was in their favor.

Raytheon CEO Greg Hayes says high tensions in Asia, the Middle East and Eastern Europe could lead to increased sales internationally, but not directly; Conversely, then 2022 and beyond.