Free trade has resulted in a global economy that has grown by leaps and bounds over the last few decades. As a result, many countries have seen certain industries grow – and certain industries move to other countries that can produce those products at a lower cost. While this has been great for consumers – who see lower prices – it is concerning for critical areas like defense. This graphic highlights some of the key concerns. The security of the supply chain for key components is a particular concern. Here are just a couple of recent articles on supply chain concerns:

Pentagon Investing in Microelectronics Technology

Some key quotes from this article: “The Pentagon is not only looking for high performance chips but trusted ones that have been manufactured in the United States.” - Richard W. Linderman, deputy director for research and engineering in the office of the assistant secretary of defense. The issue “is of great concern to DoD because every weapon system we have has microelectronics.” - Mary Miller, who is performing the duties of the assistant secretary of defense for research and engineering.

The US is running out of bombs — and it may soon struggle to make more

One particularly troubling quote from this article is: “Some suppliers have dropped out entirely, leaving no option for replacing vital materials. Other key suppliers are foreign-owned, with no indigenous capability to produce vital parts and materials ― setting up the risk that a conflict with China could rely on Chinese-made parts.”

Defense and delusion: America‘s military, industry are falling behind

Again, a troubling quote: “Today, instead of a robust bench of large and mid-sized companies and their myriad small-business suppliers competing and producing new capabilities at the speed of information-age innovation, our defense industry has shrunk to a few standout corporations. This has obscured fragile supply chains that are hampered by a risk-averse government acquisition system that takes 10 years to field a replacement handgun for the services.”

Defense Manufacturing

For the United States Department of Defense, the Manufacturing and Industrial Base Policy (MIBP) office supports the Under Secretary of Defense for Acquisition and Sustainment by providing detailed analyses and in-depth understanding of the increasingly global, commercial, and financially complex industrial supply chain essential to our national defense. This organization has several assessments of the US defense industrial base. One of their latest documents is the Fiscal Year 2017 Annual Industrial Capabilities Report to Congress.

Another key organization following this is the US Government Accountability Office (GAO).  This just released, 50-page report highlights many of the risks in the US Defense industrial supply base.

Lastly, one more group trying to address this issue is the National Defense Industrial Association (NDIA). Mercury Systems is a member of this group. NDIA has a working group focused on the Industrial Base and is working on many of the issues in this area.

In the defense electronics market where most component manufacturing has moved overseas – and not to NATO or allied countries – the concern is even greater. Many of our key Radar, EW, C2, ISR and communications technologies depend on advanced electronics, and many of these systems depend on a global supply chain where trust is not assured.

Mercury takes this very seriously. Over the past 5 years, we have invested hundreds of millions of dollars in manufacturing infrastructure that is located in the United States just to deal with assured and trusted supply of critical electronic supplies. We work very hard to answer the question asked by US Army Chief of Staff, General Mark Milley:

“How do we put technology into the hands of our soldiers (and by extension our airmen, sailors, Marines, Coast Guard and first responders) faster?”

We recently published a Whitepaper on this topic. This paper, Next Generation Integrated Defense Electronics Manufacturing - Deploying innovation at the speed of technology, highlights not only how Mercury manufactures electronics with trust and assurance, but also pulls the latest commercial advances from Intel, NVIDIA and others into our designs.