WASHINGTON—In the aftermath of a deadly rampage that stretched from coast to coast, authorities reported Tuesday that more than 330 million Americans had been found dead following yet another mass shooting. “The perpetrator was a lone gunman who slayed victims in more than 30,000 cities, towns, and villages across the…
My research in this area suggests that, however this war eventually ends, the repercussions for the global defense industry, and for the countries whose companies dominate this sector, will be enormous. Here are four takeaways.
The situation has become so dire that there are reports that commanders are trying to preserve equipment by forbidding troops from using them to evacuate wounded soldiers or to support units that have advanced too far.
Russia’s offensive weapons have also proved disappointing. Its missile failure rate – the share that either failed to launch, malfunctioned mid-flight or missed their target – may be as high as 50% to 60% due to design flaws and outdated or inferior equipment.
These problems, along with the Russian military’s slow progress achieving any of President Vladimir Putin’s stated objectives, have raised serious doubts among the country’s traditional customers for weapons exports. Russia sells almost 90% of its weapons to just 10 countries, including India, Egypt and China.
What’s more, Russia’s ability to replace these equipment losses has been hampered by economic sanctions, which bars key foreign components like circuit boards. And Russia will almost certainly need to replace its own military hardware before it exports anything abroad.
That means that even countries that want to keep buying Russian tanks and fighter jets will have to wait in line or turn elsewhere to fulfill their defense needs.
2. Russia’s loss is China’s gain
The country that will likely see the greatest gains from Russia’s displacement as a major arms supplier is China.
At the moment, only three of the world’s 40 biggest arms importers – Pakistan, Bangladesh and Myanmar – buy a majority of their weapons from China. That could change if China takes advantage of Russian weakness to position itself as a reliable national security, economic and political partner – a core feature of its Belt and Road Initiative.
China is not capable of supplanting U.S. and European weapons, which are considered “top shelf” because of their high quality and price. But China may well fill the market niche that Russian arms makers dominated, thereby increasing Beijing’s role as a major weapons exporter – and gaining the political and economic benefits that accompany that.
The massive amounts of weapons being transferred from the U.S. to Ukraine will keep American arms makers busy for some time to come. For example, the U.S. has transferred about one-third of its stock of Javelin anti-tank missiles to Ukraine, and it will take three to four years for the Raytheon-Lockheed Martin joint venture to replace them. The US$40 billion aid package recently signed by President Joe Biden includes $8.7 billion to replenish U.S. weapons stocks.
The companies’ soaring stock prices are a sign investors believe profitable days are ahead. Lockheed Martin’s stock price is up over 12% since the invasion began – with most of the gains occurring in its immediate aftermath. Northrop Grumman has jumped 20%. At the same time, the broader stock market as measured by the S&P 500 has slumped about 4%.
4. More countries will become arms makers
The flipside to this is that some countries that relied on others for their defense needs may seek to become more self-sufficient.
India, which relied on Russia for almost half of its weapons imports in recent years, is realizing that Russia will need most or all of its production capacity to replace tanks, missiles, aircraft and other weapons used or lost in Ukraine, with less leftover for export.
That means India will need to either source spare parts for vehicles and weapons from other former Russia arms customers such as Bulgaria, Georgia and Poland, or build up its own defense industry. In April, India announced it would ramp up production of helicopters, tank engines, missiles and early airborne warning systems to offset any potential reduction in Russian exports.
Brazil, Turkey and other emerging market countries have also been developing their own defense industries over the past two decades to reduce their reliance on arms imports. The Ukraine war will accelerate this process.
Putin likely didn’t expect to shake up the global arms market with his effort to annex Ukraine – or cause the decline of his country’s weapons sector. But that’s just one more way his war is causing a geopolitical earthquake.
Terrence Guay received research funding from the US Army War College, most recently in 2017.
As hacker groups working continue to hammer a former Windows zero-day that makes it unusually easy to execute malicious code on target computers, Microsoft is keeping a low profile, refusing even to say if it has plans to patch.
Late last week, security firm Proofpoint said that hackers with ties to known nation-state groups were exploiting the remote code execution vulnerability, dubbed Follina. Proofpoint said the attacks were delivered in malicious spam messages sent to fewer than 10 Proofpoint customers in European and local US governments.
Microsoft products are a “target-rich opportunity”
In an email on Monday, the security company added further color, writing:
CNN's new boss Chris Licht says that beginning today, CNN has added a "Breaking News” guideline to its stylebook, to address overuse of the breaking news banner across its network and cable news writ-large.
Why it matters: Licht and Warner Bros. Discovery CEO David Zaslav have made it a priority to dial back on partisan programming at CNN in favor of traditional journalism.
“We are truth-tellers, focused on informing, not alarming our viewers,” he said in the note obtained by Axios.
"You’ve already seen far less of the 'Breaking News' banner across our programming."
Details: Licht said he agrees with complaints from "people both inside and outside the organization" that the network overuses the "Breaking News" banner.
"It has become such a fixture on every channel and network that its impact has become lost on the audience."
To address the issue, CNN bureau chief Sam Feist has led a team in building out "Breaking News" guidelines for CNN's stylebook, per the note.
"It certainly will need tweaks, so we are open to feedback, but this is a great starting point to try to make “Breaking News” mean something BIG is happening," Licht wrote.
The big picture: Zaslav and mentor and investor John Malone have been public about their push to bring CNN back towards hard news coverage, and away from progressive commentary.
Noting that the network is focused on "informing" and the truth, he said, "The tenor of our voice holistically has to reflect that."
"[W]e must be vital, relevant, and respected – and how we show up for our audiences, in every story, in every part of the country, and around the world, matters."