Lockheed lauds U.S. arms sales push, sees foreign sales rising


Top U.S. weapons maker Lockheed Martin Corp welcomed a push by U.S. President Donald Trump to speed up approvals of arms sales, saying it would reassure allies who had been frustrated by bureaucratic delays in the past.

The Trump administration last week rolled out an overhaul of U.S. arms export policy aimed at expanding sales to allies, saying it would bolster the American defense industry and create jobs at home.

Rick Edwards, executive vice president of Lockheed Martin International, told Reuters the initiative should help speed up progress on foreign weapons sales that have already helped fuel his company’s growth in recent years.
“It will reassure some of our allies that we’re going to move the process faster,” he said in an interview on the eve of the ILA Berlin Air Show. “They get frustrated with how long it takes to get through all the wickets.”

Foreign sales accounted for about 30 percent of Lockheed’s revenues in 2017 and should expand further in coming years, Edwards said, although he declined to name a specific target.

Lockheed on Tuesday reported better-than-expected quarterly profit and raised its full-year forecast, helped in part by sales of its stealthy F-35 combat jets.

Edwards said that he would not be surprised if U.S. allies in the Gulf began requesting information about the F-35 during the Trump presidency, although future sales would depend on political decisions in that region and the United States.
“These countries are very strong allies, and they’re buying a lot of American equipment, so the logical next step is that they’ll pursue the rest of American capabilities,” he said.

At the same time, he said, Saudi Arabia and its Gulf neighbors were working to beef up their air and missile defense capabilities and meet other military needs, which would probably take precedence before they moved ahead on any F-35 purchases.

A planned sale of Lockheed’s Terminal High Altitude Area Defense (THAAD) missile defense system is currently in the contract review process in Saudi Arabia, he said.

Lockheed is working closely with Saudi Arabian Military Industries, or SAMI, to work out details on local jobs and local sovereignty, and is likely to wind up with hundreds of Lockheed employees in the kingdom, Edwards said.

Saudi Arabia has announced “ambitious” plans to increase the percentage of local work done on weapons contracts to around 50 percent from 2 to 3 percent currently by 2030, he said.

Lockheed is also “bullish” on sales in Europe, where it already has 3,500 employees and eight offices, Edwards added.

The company is focused heavily on several German competitions, including a multi-billion-euro heavy-lift helicopter competition in which its CH-53K King Stallion will square off against Boeing’s twin-rotor CH-47 Chinook. The CH-53K will make its international debut at the air show this week.

Edwards said he was confident that the company’s joint venture with European missile maker MBDA would be able to make a deal with Germany for a missile defense system after years of negotiations. “I don’t see any showstoppers and the messaging from our customers has been great,” he said.

Lockheed is also hoping to score Germany as a new buyer for its F-35 stealth combat jets. The U.S. government on Tuesday provided data to the German defense ministry on the F-35 and the F-15E and F/A-18E/F fighter jets built by Boeing Co.