Main Image Credit Ammo needed: a British Army Royal Artillery GMLRS firing during exercises. Image: Defence Imagery / OGL v3.0
Increasing the output of the West’s defence industry to address critical shortfalls in munitions will require decades of commitment and a concerted multi-government effort.
The war in Ukraine has triggered alarm bells in the West as ministries of defence (MoD) take worrying looks at their ammunition stockpiles, and compare them with those being spent by Russia and Ukraine. The defence industry itself has made its unease clear. Raytheon signalled in April that it would be unable to manufacture new FIM-92 Stinger missiles until 2023 due to supply chain shortages. The state of the US’s war stocks of this system – which has proven itself to be very valuable in Ukraine – is therefore uncertain. Stinger is not the only system to be raising concerns: the US has also indicated its discomfort at the quantity of missiles and rockets being sent to Ukraine for the HIMARS multiple launch rocket system, as well as FGM-148 Javelin anti-tank missiles, and even 155 mm artillery ammunition. The UK has contributed more than 5,000 of the Saab Next generation Light Anti-tank Weapon (NLAW) to Ukraine, as well as 16,000 rounds of artillery ammunition, likely straining its own stocks and leading Defence Secretary Ben Wallace to observe that there might be challenges in refilling the UK’s NLAW stocks. The UK government has asked BAE Systems to replenish its stocks of artillery ammunition, but these are provided by multiple manufacturers, many of whom are facing similar challenges.
A Small Base
The UK must increase its production and procurement of munitions and complex guided weapons, not only to ensure it can fight a peer war and win, but also to give its deterrence posture credibility. The need is clear and generally understood by serving personnel and policymakers alike. However, the commitment required to achieve this is less well appreciated. Defence manufacturing is similar to boutique fashion: its outputs are specialised and expensive, and one should expect to wait for them. Defence manufacturers are not set up to produce at scale or speed, and even large production lines such as Lockheed Martin’s F-35 factory, which is expected to produce and deliver 169 F-35s in 2022 out of a total of approximately 3,200 aircraft, are small when compared with commercial production. Boeing, for example, produced 31 of its 737 Max airliner per month in 2022, alongside production of many other airframe types.
The small production output limits the ability of defence manufacturers to increase their output in a short space of time because the infrastructure does not exist, and nor do the staff or the materials. In addition, the machine tools used to make complex guided weapons are generally configured for limited series production, as opposed to mass production. Adjusting them to allow for much greater quantities would require different manufacturing processes. So, it does not follow that the existing base could be used to create an immediate increase in productivity.
Some manufacturers of complex munitions are already operating with order backlogs valued in the billions: MBDA's backlog stands at $18.3 billion; Raytheon's defence businesses have a backlog valued at $63 billion, including several missile projects; and Lockheed Martin’s Missiles and Fire Control states it has a backlog of $28.077 billion. It follows that while new orders may be welcome, there may be challenges in pushing them to the front of the queue and gaining quick results. For example, Poland is in the process of negotiating the procurement of 200 additional M142 HIMARS rocket launchers. How will this order impact the wider availability of the munitions fired by both HIMARS and the UK’s GMLRS? Not to mention the six current HIMARS users – including the US Army – and six potential future users, as well as the 15 MLRS/GMLRS users.
The first challenge for the UK in ramping up munitions manufacturing is that most defence manufacturers are starting from a very small production base
To give a recent example, in June 2022 the US Army awarded a Lockheed Martin–Raytheon Javelin Joint Venture company a low-rate initial production contract for a new Lightweight Command Launch Unit (LWCLU) for the Javelin missile. The LWCLU includes the sight and fire control system that enables the Javelin missile to be fired. According to Janes, there were 200 LWCLUs on order in October, with the first deliveries expected in 2025 – three years after the order was placed. At the same time, the company is attempting to ramp up its annual production of Javelin missiles from 2,000 to 4,000. It does not anticipate reaching this figure until 2026, the company told Janes.
More recently, the US Army has taken steps to ramp up its munitions production from 14,000 155 mm shells per month to 20,000 by spring 2023 and 40,000 by 2025. Support for this includes a $600 million industrial investment, procurement contracts with three manufacturers, and expansions of three US Army ammunition plants. The effort will require support from Congress and enduring political consensus, and demonstrates the length of time and investment required to increase munitions production.
This is the first challenge in ramping up munitions manufacturing for the UK: most defence manufacturers are starting from a very small production base. Introducing a meaningful increase will take time, investment and sustained political will.
Feast and Famine
Additionally, there is the challenge of MoD procurement frameworks and attitudes. Understandably, the MoD must demonstrate the value to the taxpayer of its procurements, as well as the technological need for them. In some cases, this drives a ‘feast and famine’ procurement attitude. Large orders will be placed to reduce the cost per system, followed by a long period without orders. This has a significant impact on the manufacturer, which must account for the staff and machine tools required to build those capabilities by either securing export contracts, or diversifying production into other, more certain streams of income. In extreme cases, the demand signal might drop off altogether, leading to a loss of expertise and machinery at the integrator level; and in severe cases the supply chain will also diversify, leading to a loss of components, which in turn creates obsolescence issues in legacy weapons that remain critical.
These are challenges that can be overcome, but again this will require time and definitive commitment; signed contracts for orders are more convincing than letters of intent, for example, as integrators cannot commit to their suppliers without them. However, there is also a need for a prolonged commitment to munitions production, procurement and stockpiling. Stockpiling munitions is expensive and brings additional value risk as unused munitions must be disposed of at cost. In 2008, the UK awarded large contracts to MBDA and NAMMO for the disposal of 27,000 standard MLRS rockets and 22,000 rockets carrying cluster munitions, according to a report published by Jane’s International Defence Review. France faced similar issues, as did many other European countries. This was in part caused by the Ottawa Treaty banning the use of cluster munitions, but the demilitarisation of standard MLRS rockets also demonstrates the financial risk of maintaining large ammunition stockpiles.
Successive governments have allowed the stockpile to dwindle, so it will take multiple successive governments to replenish it
However, if the strategic risk of war with Russia is accepted, an increase in magazine depth is essential in order for the British armed forces to form an effective element of NATO’s deterrence package. It is therefore necessary for policymakers and the MoD alike to understand and make clear the long-term costs and support required for this element of defence procurement.
Supply Chains and Dependencies
The supply chains for complex munitions are diverse and introduce further challenges to ramping up production. The Saab NLAW originally relied on more than 14 different suppliers, for example – all of whom will have been subject to the pressures of infrequent orders for the weapons systems mentioned above. Some components used in missiles and guided munitions are impacted by backlogs in microchip production caused by the Covid-19 pandemic, while at the same time representing a potential vulnerability in the event of a dispute with China. Lead times for some chips are sometimes measured in years, not weeks or months – and that is without a backlog. This is reflected in an April statement from the CEO of MBDA, who expressed concern that, while supplies of raw materials were good, that situation might not last forever. Furthermore, the relatively small production lines also make defence manufacturing an unattractive market for suppliers, who can expect far larger orders from the commercial sector and might reasonably be expected to prioritise accordingly.
It is important to understand that the cause of the UK’s reduced munitions stockpile has been in the making since 1991. Successive governments have allowed the stockpile to dwindle, so it will take multiple successive governments to replenish it. The UK’s defence industry, and by extension Europe’s, requires concerted multi-year commitments to increased munitions production if it is to increase output, as well as an understanding from policymakers that this process will not be quick or easy.
Because of this, policymakers should be aware that shortages in current stocks of complex weapons and munitions may be difficult to overcome in the next 12 months. A more realistic timeframe would be the period of 2025–2026, assuming that political will is maintained throughout that period and a shared understanding of what is required in the production of complex munitions is reached.
The views expressed in this Commentary are the author’s, and do not represent those of RUSI or any other institution.
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