“We don’t go to war without China.” -Greg Hayes, CEO of Raytheon. China has been slowly and quietly pulling back the supply of essential parts for the US military, while billions of dollars in US material is being consumed very quickly in Eastern Europe and the Middle East.[6]
“It will take a decade to be capable of replacing some of these critical components internally.“
The significant role China plays in the supply chain for the U.S. military-industrial complex, in addition to antibiotics and pharmaceuticals, and rare earth metal based components for computers and electronics, is shocking when one knows the details.
Hayes emphasized with many core goods and components used by the U.S. military manufactured in China, a sudden decoupling would be impossible.[1][2][4]
The U.S. has been attempting to de-risk its reliance on China by diversifying its supply sources, but a complete decoupling is not feasible in this decade, due to the scale and integration of Chinese manufacturing in global supply chains[2][4].
The long-term strategy of China to manufacture specifically selected products, at prices that are irresistible to US procurement officials in the government and private sector, and the pressure from boards and shareholders to do just that, is a fascinating study. The frog will eventually boil, if that’s the plan.
The Endgame under consideration and development by China, Russia, Iran, and North Korea (and as they say in pro sports, “and other players to be named later“) of outsourcing strategically essential US matériel manufacturing — will also be “riveting” to watch.
Sources
[1] Greg Hayes, chief executive of Raytheon, said the company … – Reddit https://lnkd.in/e_UgVPQ3
[2] Raytheon CEO: It’s important to understand that we have … – YouTube https://lnkd.in/eT2G_hnW
[3] The Military Industrial Complex Is More Powerful Than Ever https://lnkd.in/ezzdVJFS
[4] ‘We can de-risk but not decouple’ from China, says Raytheon chief https://lnkd.in/eu4s7HEv
[5] Raytheon CEO: It’s important to understand that we have to … – CNBC https://lnkd.in/eA8NhtMN
[6] Brigadier General Rob Spalding, US Air Force (ret)
https://lnkd.in/eXN6ZMeU
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