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The UK Ministry of Defence (MOD) is shifting its spending from US-based companies to European suppliers, marking a significant development in the country's defence procurement landscape. According to research by Tussell, the MOD paid out £52.5 billion ($70 billion) to private sector contractors between 2019 and 2024, with the majority spent on UK-based firms. The shift away from US-based companies is attributed to various factors, including tariffs and a desire for diversification in defence procurement. This trend may have broader implications for global security and defence cooperation.
The UK Ministry of Defence has shifted its defence spending away from US-based companies towards European suppliers, starting in 2022.The MOD's expenditure with private contractors grew 31% between 2019 and 2024, representing a real-terms increase of 5%.The majority of spending (£52.5 billion) went to UK-based firms like Rolls-Royce and BAE Systems, with the remainder going to US-based companies.The share of French firms increased from 5% to 12% over the last five years, mainly due to the FDIS program.Decisions by the current US administration, such as tariffs, may have accelerated this trend towards greater European involvement in UK defence procurement.
The United Kingdom's Ministry of Defence (MOD) has been steadily shifting its defence spending away from US-based companies and towards European suppliers. This shift, which began in 2022, is a significant development in the UK's defence procurement landscape. According to research by Tussell, a leading provider of defence intelligence, the MOD's expenditure with private contractors grew 31 percent between 2019 and 2024, representing a real-terms increase of 5 percent.
During this period, the MOD paid out £52.5 billion ($70 billion) to private sector contractors, approximately half of which was spent with firms headquartered in the UK, such as Rolls-Royce and BAE Systems. The remaining share of the spending went to US-based companies like Boeing and Lockheed Martin. However, from 2022, there was a notable shift in spending away from the US-based firms, while European suppliers have experienced growth.
For instance, the share of French firms increased from five percent to 12 percent over the last five years. This trend is attributed mainly to the MOD's £1.6 billion ($2.12 billion) Future Defence Infrastructure Services (FDIS) program, announced in 2021 and set to run for seven years. The program has led to an increase in facilities management and construction spending, which accounted for 14 percent of MOD expenditure in 2024.
The shift away from US-based defence contractors could be attributed to various factors, including decisions and announcements made by the current US administration, such as tariffs. While these effects have yet to be fully realized, they may accelerate the trend towards greater European involvement in the UK's defence procurement landscape.
It is also worth noting that the MOD has been invoiced approximately £700 million ($930 million) by the US Department of Defense for a combination of projects, including the F-35 Lightning program. This program has had its fair share of challenges, with software problems causing headaches leading up to the delivery of the first aircraft in the UK.
The F-35 jets featured a "kill switch" allowing the US to disable the aircraft remotely, a scenario that is unlikely but highlights the reliance on US software and access to which could be blocked. In light of this, the recent trend of spending more with European-based companies than US-based firms could accelerate in future years, as workable alternatives to US solutions can be found.
In conclusion, the UK's defence spending shift towards Europe marks a significant development in the country's defence procurement landscape. As the MOD considers its supply chain and where to spend its budget, it is essential to recognize the potential benefits of diversifying its relationships with international suppliers.
This trend may also have broader implications for global security, as countries seek to reduce their dependence on specific nations for military equipment and technology. The UK's decision to shift towards European-based companies demonstrates a commitment to strengthening alliances and exploring alternative solutions to US-led initiatives.
As the defence landscape continues to evolve, it will be crucial to monitor this trend closely and assess its potential impact on global security and defence cooperation. The UK's ability to navigate this new era of global alliances will play a significant role in shaping the future of defence procurement and international relationships.
Related Information:
https://www.ethicalhackingnews.com/articles/The-UKs-Defence-Spending-Shift-A-New-Era-of-Global-Alliances-ehn.shtml
https://go.theregister.com/feed/www.theregister.com/2025/05/10/uk_ministry_of_defence_drops_us_spending/
Published: Sat May 10 06:20:15 2025 by llama3.2 3B Q4_K_M
