Maybe it was just me, but there seemed to be more handshake deals between companies than airplane buys—military and commercial—at last week’s Farnborough International Airshow. 

As a Farnborough first-timer, I had very few expectations. I guessed there likely wouldn’t be as many aircraft flying because of surging fuel prices and the Iran war. And the NATO Summit already had several major announcements. 

But given the fanfare, should there have been more big buys trumpeted? Or are industry deals—showcasing how willing companies are to collaborate—the new normal?

“There are always partnerships being announced, but I think it was more of a lack of the large order announcements that we typically see that made them more visible,” said Grant Holve, a commercial aerospace analyst for Forecast International, a sibling brand of Defense One that provides market analysis and intelligence. “It was a 50-50 split between commercial and defense this year…usually it’s like 80-20 or 70-30 tilted toward commercial.”

The lack of big purchase announcements coupled with the strong European defense spending backdrop seemed curious to me. But a theme emerged: dual-use commercial aircraft venturing into the defense arena.

“Commercial crossovers into defense aerospace seemed to be an identifiable theme. That was a takeaway I noticed specifically with the ‘contested logistics’ space for air taxi companies,” said Jon Hemler, director of Forecast International’s military aerospace and weapons division. 

Those eVTOL makers definitely made a splash, from Archer Aviation’s snazzy black and gold chalet (and partnership with Anduril) to Sikorsky teaming with Beta Technologies’ MV250 on autonomous cargo aircraft.

“It’s increasingly an area where civil firms can partner with defense companies as an entry point to the market,” Hemler said. 

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A boom for the aerospace supply chain. The more electrified and digitally-infused aircraft get, the more parts they need. That’s good business for distributors like FDH Aero, which team up with multiple suppliers to bulk buy, store and sell parts to customers.  

• “There’s a lot more digital components, connectors, wires than there were two decades ago,” thanks to the electrification of aircraft and increasingly complex digital environments, CEO Ian Walsh told Defense One at the Farnborough airshow. “And because defense and commercial are growing very sharply, there’s a huge pull on the supply chain to keep up with that.”
• That demand can put a lot of strain on suppliers as commercial companies cross over to sell more to militaries.
• “Imagine an [original equipment manufacturer] that’s building helicopters for commercial [customers], and now this military customer wants 250 helicopters…they basically have to double their production, so it’s putting a lot of strain on the supply chain to keep up,” he said. “We are seeing and benefiting from the fact that we’re really good at what we do. We source long-lead time parts. We know our customers’ build rates in production, so we’re really able to plan.”
• Plus, drones need parts too: “If you’d been here a decade ago, if somebody mentioned the word ‘drone’ or ‘unmanned,’ they would look at you kind of funny. And I think every single booth [here] has some connection or product that’s now tied to unmanned drones, eVTOLs. So that’s a whole new frontier.”
• But at the end of the day, while the “brains” of the newer, possibly autonomous, aircraft may differ, “an airframe is an airframe, whether it’s going into space or it’s landing vertically or landing on a runway. They all have connectors, rivets, bolts, connectors, fasteners—a bunch of little components all over it. I mean, there’s just hundreds of thousands of those pieces all over that aircraft.”

Quick turnaround. Last week’s executive order on critical minerals will push defense contractors to get clear visibility into their supply chains by next year—a timeframe that caused much consternation. But could it be the push that prime contractors need? Can the industrial base risk waiting longer?

• “It’s a critical element of sovereignty for us to be able to make sure that we can create deterrence through our industrial base,” said Chris Morton, who leads aerospace and defense business for IFS, which provides AI-fueled enterprise software and asset management for industrial businesses. 
• But “directing prime contractors, essentially, to rationalize their entire supply chain all the way to the bottom…it’s a Herculean undertaking.”
• Morton said that type of visibility isn’t common among prime defense contractors, but getting that insight could lead the industry to uncomfortable, but necessary discoveries. 
• “I think there’s gonna be a whole lot of surprises. In the Army, we used to say that one of the first parts of operational planning is knowing yourself. And this effort is really that first step. We may discover some things that we are not happy about. But it’s a critical part of this effort because how can you know what materials you need to source and components you need to manufacture if you don’t really know what goes into your supply chain? We’ll see how the defense primes respond to this, because this is not an easy undertaking, not one bit.”
• Related reading: In a July 22 report, the Government Accountability Office evaluated ways to reduce imported critical mineral reliance and recommended four policy changes to help that: creating domestic manufacturing capacity; building more infrastructure for battery and semiconductor recycling; making it secure; and investing in research and testing.
• And another thing: The Trump administration plans to ban robots and inverters made in China and certain other nations, to bolster U.S. efforts in the sector.

Making moves + other news

• A revolving door in reverse? The Pentagon wants to bring in more people from the private sector into defense acquisition and procurement roles through a new hiring program. But that could cause “significant conflict of interest” that’s layered with “corruption concerns” and “national security implications,” said Sen. Elizabeth Warren, D-Mass., in a letter to Deputy Defense Secretary Stephen Feinberg, CNBC reported. 
  • Related: Feinberg has been scrutinized for at least appearing to benefit financially from his post alongside other members of the Trump administration. Earlier this week, Sen. Warren sent a separate letter to Feinberg re-upping concerns from April about his financial ties to the firm he co-founded, Cerberus Capital Management, and oversight of the Golden Dome for America project. 

• Defense technology company Tagup wins a Marine Corps contract to help streamline equipment maintenance and repairs for 1st Maintenance Battalion in California. No dollar amount was listed, but Tagup’s Manifest AI platform uses a trove of data to see where all the parts for a given piece of gear come from, anticipate demand in an uncertain environment, and help troops plan for deployments. 
  • “Every maintenance decision requires balancing readiness, cost, and time,” Paul Plemmons, president of Tagup, said in a news release. 
  • “Manifest gives maintainers the decision advantage to weigh those tradeoffs and commit to the course of action that best keeps mission-essential equipment ready and available.”
• Leonardo DRS to buy tech company Raft for $450 million. 
• Leidos wins $717 million Air Force contract for ISR support for Air Combat Command. The contract extends work the company has done since 2019.
• The think tank Center for Strategic and Budgetary Assessments added Phil Davidson and Anita Antenucci as the board chair and vice chair, respectively. 
  • Davidson is the former commander of Indo-Pacific Command and has been on CSBA’s board for four years. 
  • Antenucci has served on the board for nearly eight years and founded the investment banking firm 3Wire Partners.

One more thing: A Seasats drone boat caught footage of a Chinese warship near the Philippines, Reuters reported.

Jennifer Hlad contributed to this report.

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