With strong allied military support for Ukraine in its war against Russia, one of most debated issues on both sides of the Atlantic is whether there is enough defense industrial capacity between North America and Europe to meet the current and future defense capability needs of NATO and its member states.
Put simply, this is the wrong way to view the situation. Prioritization, not capacity, is the real issue facing allies as they continue to supply Ukraine but also work to ensure NATO members have enough defense items for future needs. This is a real opportunity for both the United States and its NATO allies to build lasting transatlantic industrial resilience for the future.
This week, NATO armament directors will meet to tackle these exact issues. Leading the charge will be Bill LaPlante, the U.S. undersecretary of defense for acquisition and sustainment. The agenda will focus on what allies need to give Ukraine to continue to defend itself and what types of weapons and technology allies need for their own militaries. Ensuring that Ukraine as well as all NATO members have the equipment and material they need is at the heart of self defense as well as NATO’s Article V collective defense commitment.
Defense industrial base capacity is an issue that is not going to go away. While COVID-19, inflation and Russia’s invasion have exacerbated industrial base issues, the reality is that supply chain and production challenges have existed for at least a decade because of government acquisition policies, including programming and budgeting programs with limited ability to extend or expand production; unnecessary congressional budgeting practices like sequestration; parliamentary resistance to investing in needed capabilities, as seen in Europe over the past two decades; and highly bureaucratic defense export policies on both sides of the Atlantic.
This week’s sessions are a critical opportunity for the allied governments and industry to begin the necessary policy, regulatory and mental adjustments needed to prioritize defense production where it matters most. Three topics are key for these upcoming NATO sessions.
First is to recognize that capacity exists across the transatlantic space, but that some of the items currently needed for the Ukraine fight struggle with obsolescence issues. Javelins and Stingers, for example, are no longer produced in significant quantities for U.S. or allied forces and surging production lines is difficult.
At the recent Defense News conference, LaPlante said DoD needs to invest in the supply chain to meet today’s needs and to ensure resiliency for future demands. Critical here is not just more investment dollars but also predictability, stability and durability of demand. DoD’s recent signaling that it is open to multiyear procurement of munitions will be extremely helpful in that regard.
Second, the Ukraine war has demonstrated the U.S. must modify its foreign military sales processes to produce and export at speed. The biggest complaints industry and allies make about the FMS system is that it is slow, opaque and unpredictable. This must change.
As we have seen since the outbreak of the war against Ukraine, U.S. and allied governments can move at the “speed of need” to provide material and weapons. However, as noted by numerous DoD officials, the answer has been to throw more people at the problems and work longer hours; no systemic fixes have been undertaken for future needs. Senior leaders need to pursue flexibility within existing laws — and a willingness to use this flexibility — to meet future demand.
Third, industrial resilience is built before a crisis. Developing a “build allied” approach — co-production, licensed manufacturing, and other flexibility options — will increase resiliency and benefit both sides of the Atlantic in terms of increased jobs, industrial output, trade, and interoperability. It will also allow for more hot production lines in times of crisis.
By prioritizing actions such as these, U.S. and allied leaders will get the industrial base capacity needed to ensure weapon availability for fights today and tomorrow. While the specific requirements of future conflicts are unknown, now is the time to build in resilience to existing and future defense programs and for the State and Defense departments to figure out how to make FMS transactions move faster to trusted allies. It is critical to our collective future.
Daniel Fata is a nonresident senior adviser at the Center for Strategic and International Studies. He previously served as the U.S. deputy assistant secretary of defense for Europe and NATO policy during President George W. Bush’s administration. Jerry McGinn is executive director of the Center for Government Contracting at George Mason University’s School of Business. He is a former senior acquisition official for the U.S. Defense Department.
