The 2020 global COVID-19 pandemic severely disrupted trade and industry. The United States’ defense industrial base was unable to escape that disruption. Due to their global nature of their supply chains, defense contractors such as Lockheed Martin felt the impact of COVID-19 before many Americans. In early March of 2020, Lockheed Martin was forced to temporarily halt production of F-35 jets in Japan and Italy. Weeks later, President Trump declared a state of emergency and shutdowns began occurring domestically.
Initially, defense contractors responded in the same way as other US industries with furloughs and temporary shutdowns. However, the private nature of US defense manufacturers has allowed them to diversify beyond weapons manufacturing. This diversification meant that many firms were able to pivot and, if not capitalize on the pandemic, at least weather the storm. As just one example, Lockheed Martin began manufacturing personal protective equipment including face shields and medical gowns, as well as began consulting on manufacturing strategies for vaccines.
The pandemic also provided these industries with an opportunity to better prepare for future disruptions. An estimated $10 billion was spent industry wide to “…reconfigure production lines and build infrastructure for remote working,” an investment that is likely to be offset by decreased production costs resulting from the reform. Ultimately, major contractors such as Raytheon, Lockheed Martin, and BAE suffered minor delays in production but felt as though those disruptions were minimal.Between the $4.6 billion provided to the defense industry by the DoD and other federal relief efforts since March of 2020, the defense industry has nearly recovered entirely. The pandemic forced firms industrywide to analyze weaknesses in their global supply chains and production lines. Ultimately, it appears as though the industry’s response to the challenges of COVID-19 has left them better prepared to maintain productivity during future disruptions