The US defense industry will still enjoy “large and fairly stable markets” domestically even with projected flat or declining defense budgets in coming years, said Frank Kendall, the Pentagon’s deputy acquisition executive. “It should be clear that while we anticipate significant change from the environment of the last decade or so, the sky will not fall on our defense industry,” stated Kendall Tuesday in testimony before the Senate Armed Services Committee’s emerging threats panel. He added, “We do not foresee a precipitous decline, like the one that the department and industry experienced at the end of the Cold War” since “we are not seeing a fundamental change in the national security situation.” Kendall said the Defense Department still expects that “market forces [will] be the primary mechanism by which industry responds” to coming changes. DOD will only intervene “in rare exceptions” when it deems it necessary to protect critical capabilities or ensure competition, he said. Per President Obama’s directive, the Pentagon is launching a comprehensive review to identify additional efficiencies and areas of potential cuts over the next 12 years. Kendall said the industrial base will be a factor in that review.
The Air Force overall reduced its size by 120 aircraft in fiscal year 2021, but kept about the same number of fighter, bomber and attack aircraft, according to data supplied by the service. The F-35 fleet saw the biggest increase while the B-1B bomber fleet saw the largest decline.