{"id":57597,"date":"2020-03-20T12:00:41","date_gmt":"2020-03-20T12:00:41","guid":{"rendered":"https:\/\/one.sightlinemg.com\/defensenews\/uncategorized\/2020\/03\/20\/how-coronavirus-could-impact-the-defense-supply-chain\/"},"modified":"2026-08-08T00:19:18","modified_gmt":"2026-08-08T00:19:18","slug":"how-coronavirus-could-impact-the-defense-supply-chain","status":"publish","type":"post","link":"https:\/\/one.sightlinemg.com\/defensenews\/industry\/2020\/03\/20\/how-coronavirus-could-impact-the-defense-supply-chain\/","title":{"rendered":"How coronavirus could impact the defense supply chain"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">WASHINGTON \u2014 As the American defense industry tries to <a href=\"https:\/\/www.defensenews.com\/coronavirus\/2020\/03\/18\/we-asked-defense-companies-how-theyre-impacted-by-the-coronavirus-heres-what-they-said\/\" target=_blank>assess the way forward<\/a> under the new coronavirus pandemic, it should keep a close eye on the lower tiers of its supply chain, analysts warn.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">There are two key factors when considering supply chain logistics: production and delivery. On the production side, hurdles include the potential for workers to have to halt production work due to the spread of the virus \u2014 something that has happened, albeit temporarily, at F-35 production spots in <a href=\"https:\/\/www.defensenews.com\/air\/2020\/03\/04\/coronavirus-fears-cause-halt-at-japan-italy-f-35-facilities\/\" target=_blank>Italy and Japan<\/a> \u2014 as well as economic impacts.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><a href=\"https:\/\/www.defensenews.com\/coronavirus\/\"><b>Click here for complete coverage of the COVID-19 outbreak.<\/b><\/a><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Paul Scharre, director of the Technology and National Security Program at the Center for a New American Security, said that trying to predict the supply chain\u2019s future is like looking into a crystal ball that is zooming by your face at 100 mph.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cFor companies that are predominantly defense companies, government money is likely to keep coming,\u201d he said. \u201cThe real source of disruption is if there are statewide mandated shutdowns saying: \u2018Don\u2019t go to work.\u2019 \u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Small businesses may feel the economic pain the most, and that could spell trouble down the road. A 2018 Pentagon report on the defense-industrial base warned of \u201cdomestic extinction\u201d among the sole suppliers for critical industrial parts \u2014 shops that could fold under rough economic conditions as the world is seeing now.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For instance, there are only four American suppliers with the capability to manufacture large, complex, single-pour aluminum and magnesium sand castings needed to support American air power. Those suppliers \u201cface perpetual financial risk and experience bankruptcy threats and mergers mirroring the cyclicality of DoD [Department of Defense] acquisition,\u201d the report said.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">And there is only one qualified source for the upper, intermediate and sump housing for an unnamed heavy-lift platform used by the Marines (potentially the CH-53 King Stallion) that around 2017 went through bankruptcy proceedings. \u201cWithout a qualified source for these castings, the program will face delays, impeding the U.S. ability to field heavy lift support to Marine Corps expeditionary forces,\u201d the report said.<\/p>\n\n\n\t<aside class=\"smg-interstitial-link wp-block-smg-interstitial-link\">\n\t\t<a href=\"https:\/\/one.sightlinemg.com\/defensenews\/pentagon\/2018\/10\/04\/white-house-warns-of-domestic-extinction-of-suppliers-in-industrial-base-report-and-dod-is-ready-to-help-with-cash\/\" class=\"smg-interstitial-link__inner\">\n\t\t\t\t\t\t\t<div class=\"smg-interstitial-link__media\">\n\t\t\t\t\t<img loading=\"lazy\" decoding=\"async\" width=\"300\" height=\"200\" src=\"https:\/\/one.sightlinemg.com\/wp-content\/uploads\/2026\/08\/4419918.jpg.jpg?w=300\" class=\"smg-interstitial-link__image wp-post-image\" alt=\"\" \/>\t\t\t\t<\/div>\n\t\t\t\t\t\t<div class=\"smg-interstitial-link__content\">\n\t\t\t\t<span class=\"smg-interstitial-link__kicker\">Related<\/span>\n\t\t\t\t<h3 class=\"smg-interstitial-link__title\">White House warns of \u2018domestic extinction\u2019 of suppliers in industrial base report &#8211; and DoD is ready to help with cash<\/h3>\n\t\t\t\t\t\t\t\t\t<p class=\"smg-interstitial-link__excerpt\">The Trump administration&#039;s long-awaited defense industrial base report is finally out.<\/p>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/a>\n\t<\/aside>\n\t\n\n\n<p class=\"wp-block-paragraph\">Warned Martijn Rasser, a senior fellow at the Center for a New American Security: \u201cFor small business, a shutdown would be extremely difficult to get through because even with bailouts and economic stimulus, once those businesses close up, its really hard to get those started again.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cIf an airline goes out of business, the planes don\u2019t disappear \u2014 you can start over. If it\u2019s a highly specialized manufacturing company, those employees are going to disperse and try to find other work. So I think that\u2019s something to be very cognizant of because of all the consolidation in the defense industry,\u201d he added. \u201cIf they have to curtail operations for an extended period of time, it\u2019s extremely difficult to get it going again.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Transportation of goods is another potential issue to watch, particularly as the commercial aviation industry is shutting down huge chunks of its operations.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Noted Todd Harrison of the Center for Strategic and International Studies: \u201cWhat if parts of our transportation sector shut down so parts can\u2019t ship, or they\u2019re late shipping?\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">That may already be happening, with cargo carriers reporting increased demand for shipping goods globally. A Thursday report on industry trade publication <a href=\"https:\/\/aircargoworld.com\/allposts\/forwarders-pursue-multimodal-options-amid-overwhelming-air-demand\/\" target=\"_blank\">Air Cargo World<\/a> warned that the \u201cair cargo industry is seeing daily slashes to airfreight capacity and massive jumps in rates due to the extensive number of passenger flights cancelled globally as part of the effort to mitigate the spread of COVID-19. As a result, space on most trade lanes is tight and some even have backlogs.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Travel restrictions between countries could complicate issues, given the increasing global nature of the supply chain on programs such as the F-35 fighter jet.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">A delay of parts getting from a tier 4 to tier 3 supplier could turn into a delay from a tier 3 to tier 2 supplier, and in turn could lead to a delay in delivery of a defense article to the Pentagon. Still, the delays don\u2019t currently look likely to be too serious in context, said Byron Callan of Capital Alpha Partners.<\/p>\n\n\n\t<aside class=\"smg-interstitial-link wp-block-smg-interstitial-link\">\n\t\t<a href=\"https:\/\/one.sightlinemg.com\/defensenews\/coronavirus\/2020\/03\/16\/with-coronavirus-on-the-loose-us-shipyards-make-adjustments-but-keep-building\/\" class=\"smg-interstitial-link__inner\">\n\t\t\t\t\t\t\t<div class=\"smg-interstitial-link__media\">\n\t\t\t\t\t<img loading=\"lazy\" decoding=\"async\" width=\"300\" height=\"200\" src=\"https:\/\/one.sightlinemg.com\/wp-content\/uploads\/2026\/08\/Kennedy.jpg.jpg?w=300\" class=\"smg-interstitial-link__image wp-post-image\" alt=\"\" \/>\t\t\t\t<\/div>\n\t\t\t\t\t\t<div class=\"smg-interstitial-link__content\">\n\t\t\t\t<span class=\"smg-interstitial-link__kicker\">Related<\/span>\n\t\t\t\t<h3 class=\"smg-interstitial-link__title\">With coronavirus on the loose, US shipyards make adjustments but keep building<\/h3>\n\t\t\t\t\t\t\t\t\t<p class=\"smg-interstitial-link__excerpt\">As the new coronavirus rocks the country, the shipbuilding industry is keeping the wrenches turning.<\/p>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/a>\n\t<\/aside>\n\t\n\n\n<p class=\"wp-block-paragraph\">\u201cYou might see those delivery delays crop up this April, May, June, July. That\u2019s conceivable,\u201d Callan said. \u201cBut I think we\u2019re talking about slight changes, nothing in the order of magnitude you\u2019re seeing in airlines and then by virtue in commercial aerospace.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Other factors can also lead to potential delays of selling weapons abroad. On Thursday, the <a href=\"https:\/\/www.pmddtc.state.gov\/ddtc_public?id=ddtc_public_portal_news_and_events&#038;cat=Report\" target=_blank>U.S. State Department warned<\/a> that as a result of staff teleworking for the foreseeable future, the Directorate of Defense Trade Controls may be slow in responding to industry\u2019s needs regarding the International Traffic in Arms Regulations.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cIndustry is advised of the likelihood of longer than normal processing times due to a reduction in the availability of staff in multiple organizations to review applications,\u201d State said in a news release.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Long term, the virus may also result in a change in how America defines national security supply chains.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Rasser predicts that the coronavirus outbreak will result in a \u201ccomplete rethink of what supply chains are completely vital to U.S. security.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Until now, there was not much thought given to the supply chain security of pharmaceutical or medical equipment, where China is a major producer of the equipment needed, Rasser said. Coming out of this pandemic, \u201ca first step once we get through this crisis is a whole-of-government effort, together with private industry, to really dive deep into our current supply chains and then determine which ones we should consider critical for U.S. national security overall.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Added Scharre: \u201cTwo months ago, if there had been a bill in Congress saying we need to ensure U.S. hospitals are buying American-made masks, I would have said that was silly. This has hugely expanded the scope of things we now think of as critical to the health and safety of the nation.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><i>Joe Gould in Washington contributed to this report.<\/i><\/p>\n","protected":false},"excerpt":{"rendered":"<p>There are two key factors to watch as the coronavirus pandemic spreads.<\/p>\n","protected":false},"author":7,"featured_media":32103,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_yoast_wpseo_meta-robots-noindex":"","_yoast_wpseo_meta-robots-nofollow":"","_yoast_wpseo_canonical":"","_acf":"","_yoast_wpseo_primary_category":12,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","_smg_distribution_targets":[]},"categories":[9,160,12,36,19],"tags":[],"coauthors":[3378],"class_list":["post-57597","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-coronavirus","category-daily-news-roundup","category-industry","category-newsletters","category-pentagon"],"acf":{"subheadline":"","legacy_arc_id":"S3DKTKLG5NGLXOGNS7CYPFMCMY","arc_canonical_url":"\/industry\/2020\/03\/20\/how-coronavirus-could-impact-the-defense-supply-chain\/","remove_feature_photo":false,"is_sponsored":false,"subtype":"","redirect_url":"","disable_inline_ads":false,"native_logo_pretext":"Presented 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