Role of Military Exports in Maintaining the Defense Industrial Base

摘要

As the DoD reduces spending for military equipment and services, companies in theU.S. defense industrial base may attempt to replace a portion of lost domestic revenues with military export sales. This report examines the potential size of the export market for military exports and discusses whether that market is large enough to replace a substantial portion of the business base lost due to declining U.S. defense spending. Currently the U.S. exports $18 billion of military items annually; about 75 percent comes from new production and 25 percent comes from inventory. If U.S. manufacturers hope to replace all business lost due to defense budget declines in order to maintain 1991 levels of defense business, they cannot merely maintain current export levels but must increase exports substantially each year for the next several years. The authors argue that increasing military exports substantially is unlikely for a number of reasons and conclude that, at best, military exports will be sustained at current levels.... Foreign military sales, FMS, Military exports, Defense industrial base, Downsizing.