Pentagon's Global View

U.S. Increasingly Looks Abroad For Competitive Defense Contracts

Washington Post 03/08/05
author: Renae Merle
Copyright 2005, The Washington Post Co. All Rights Reserved

The Pentagon is increasingly shopping overseas for its weapons, ending a long made-in-America tradition that assured U.S. defense contractors of nearly exclusive sales to their best customer.

The Navy's recent selection of a British-Italian design for the president's next helicopter demonstrated the breadth of the move toward foreign suppliers. The U.S. incumbent, Sikorsky Aircraft Corp., surprisingly lost to an international team led by Lockheed Martin Corp. In another blow to Buy America advocates, the Army will base the design of its newest spy planes on Brazilian-made Embraer jets instead of Georgia-built Gulfstream aircraft.

Yesterday's announcement that BAE Systems PLC of Britain will acquire Arlington-based United Defense Industries Inc. further emphasizes the interplay between foreign and American defense companies.

The new openness raises the prospect that the Air Force will seriously entertain a European bid to replace its refueling tanker planes after a Boeing Co. deal collapsed last year in an ethics scandal at the company. Sikorsky will face two foreign rivals -- the British-Italian company AgustaWestland Inc. and Eurocopter, the world's biggest helicopter maker -- in a $10 billion Air Force competition to build search-and-rescue choppers. Also on the horizon is an Army decision on whether to replace the M16 rifle, designed by Connecticut-based Colt Defense LLC, with a German-designed gun.

"I have often said that we in the United States have never had a global monopoly on good ideas or on innovation," said Suzanne D. Patrick, the deputy undersecretary of defense for industrial policy.

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Some in Congress worry that relying too much on foreign military suppliers would hurt domestic industries and raise national security concerns. They contend that foreign governments could choose to slow or stop production of U.S.-bound products when the Pentagon needs them most.

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Instead, the Pentagon may be more willing to buy cheaper, established technology from overseas, the analysts said.

While critics are concerned that the trend could reduce the already shrinking aerospace workforce, the Pentagon argues that foreign competitors are creating jobs.