U.S. House Passes FY19 Defense Authorization Bill

by Shaun McDougall, Military Markets AnalystForecast International.

E-8C JSTARS Radar aircraft

The House Armed Services Committee wants the Air Force to restart the E-8C JSTARS Recapitalization program.
Source: U.S. Air Force

The U.S. House of Representatives recently passed its version of the FY19 defense authorization bill by a vote of 351-66.  The bill supports a Pentagon base budget of $639.1 billion, which complies with the two-year budget deal agreed upon earlier this year that amended national security spending caps in FY18 and FY19.  This base spending includes $617.1 billion for the Pentagon, $21.8 billion for nuclear programs in the Department of Energy, and $214 million for other defense-related activities.  The bill recommends $69 billion for Overseas Contingency Operations (OCO), matching the request, for a total of $708.1 billion in discretionary defense spending in FY19.  Continue reading

Recapping Global Defense Spending for 2017, Eyeing Future Growth

by FI’s International Military Markets Group.

The first annual Global Defense Snapshot by Forecast International’s International Military Market (IMM) group indicates continued growth in the worldwide market following relatively flat investment over the course of the 2015-2016 periods. An increasingly multi-polar global security environment buffeted by healthy economies and ongoing military modernization cycles contributed to a 3.3 percent year-on-year rise in consolidated worldwide defense spending for 2017. Continue reading

U.S. Approves Canadian Super Hornet Deal that May Never Happen

by Shaun McDougall, Military Markets AnalystForecast International.

A U.S. F-18 Refuels from a KC-10 Tanker
Source: U.S. Air Force

The U.S. State Department has approved the sale of 18 F/A-18E/F Super Hornets and associated equipment to Canada as part of a potential deal worth $5.23 billion, according to a September 12 announcement from the U.S. Defense Security Cooperation Agency (DSCA).  The announcement outlines the potential sale of 10 F/A-18Es, eight F/A-18Fs, eight F414-GE-400 engine spares, APG-79 radars, 100 AIM-9X-2 Sidewinder Block II missiles, 30 AIM-9X-2 Sidewinder Block II Captive Air Training Missiles, and eight AIM-9X-2 Sidewinder Block II Special Air Training Missiles, as well as additional avionics and electronics.  Continue reading

Boeing on a Roll; Both Civil and Military Markets Remain Strong

by Edward Nebinger, Forecast International.

Boeing’s KC-46 Pegasus tanker program will be a key revenue driver for the firm. Image: Boeing

Recent reports of significant layoffs by Boeing have proven to be of little concern to Wall Street investors, who shrugged those actions off as an efficiency move. Not only that, Boeing stock rose dramatically to a new high last week, and during a two-day period jumped 28 points, sending the Dow Jones Average to a new all-time high. Continue reading

Top Contractors Hold Their Positions as Defense Spending Begins to Rise

by Richard Pettibone, Aerospace & Defense Companies Analyst, Forecast International.

F-35A Weapons Carriage (Lockheed Martin Photo by Matt Short)

As defense markets continue to adapt to dynamic economic and political forces, the major players continue to hold their entrenched positions.

Regional turmoil in parts of the Middle East, Europe and Asia continue to drive the need for more spending. Further, international sales for many firms are set to expand, driven by fear over the Islamic State (also known as ISIS), a more bellicose Russia, and regional pressures from China and North Korea. Continue reading

Rockwell Expands and Diversifies with B/E Aerospace Buy

by Richard Pettibone, Aerospace & Defense Companies Analyst, Forecast International.

An employee from Rockwell Collins’ new Interior Systems business building airline cabin seats at its Winston-Salem, North Carolina-based facility. Source: Rockwell Collins

With commercial aviation production continuing apace, Rockwell Collins decided it wanted a bigger slice of the pie and expanded its operations with the $8.3 billion purchase of cabin interiors specialist B/E Aerospace.   As a result, Rockwell is now an $8 billion company, employing some 30,000 people and commanding a diverse content base on a variety of commercial and business aircraft.        Continue reading

Acquisition Programs Dominate Pentagon’s FY17 Spending Increase

 by Shaun McDougall, Military Markets AnalystForecast International.

The defense bill added a dozen Super Hornets for the U.S. Navy.
Source: U.S. Navy

The Pentagon’s FY17 budget was signed into law on May 5, more than halfway through the fiscal year.  The legislation couldn’t come soon enough, as the military has been operating under a series of three continuing resolutions that funded the department at FY16 levels.  CRs bring with them a host of difficulties, including restrictions on launching new programs, and leave many existing programs overfunded or unfunded.  The Pentagon has become quite adept at navigating CRs, which have sadly become the norm in Washington.  However, this year’s scenario was particularly troubling, as CRs in recent years haven’t lasted more than a few months. Continue reading

Mattis Budget Guidance Spans Multiple Budget Cycles, Calls for FY17 Growth

 by Shaun McDougall, Military Markets AnalystForecast International.

The Pentagon. Source: Department of Defense

U.S. Defense Secretary Jim Mattis released a memo on January 31 providing initial guidance for strengthening the armed forces through an FY17 budget amendment, the FY18 budget request, and the FY19-FY23 Future Years Defense Program.  The memo is a direct response to a memorandum on rebuilding the U.S. armed forces, released by the president on January 27.  Mattis outlines a three-phase approach: improve warfighter readiness; achieve program balance by addressing pressing shortfalls; and build a larger, more capable, and more lethal joint force.  Those objectives are centered around the completion of the FY17 budget process, and the release of the next two budget requests.

Continue reading

The Effect of 2016’s Presidential Election on Worldwide Aerospace and Defense Markets Part 1/2

By Matthew Beres, Forecast International.

election-2016

Welcome to the Forecast Roundtable Podcast. Forecast Roundtable brings together expert analysts, industry professionals, and government officials to discuss the latest issues in the aerospace and defense markets. Produced at the Forecast International headquarters, Forecast Roundtable offers unique and in depth insight and discussion on any range of topics from geopolitics to aerospace and defense markets. Topic suggestions are welcome. Continue reading

Top 200 U.S. Government Contractors FY2015

by Richard Pettibone, Aerospace & Defense Companies Analyst, Forecast International.

US Flag

The following is a list of the Top 200 U.S. Government Contractors in fiscal year 2015 ranked by the total amount of contract funds awarded. In FY2015, the U.S. Government awarded a total of $439.0 billion in contracts down 1.5 percent from $445.8 billion in FY2014. Of the $439 billion in total contract funds, $273.7 billion, almost 62 percent, were awarded by the Department of Defense (DoD).

Source: USASpending.gov

Continue reading