GM, Lockheed Martin to collaborate on weapons production
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General Motors and Lockheed Martin plan to work together to strengthen U.S. manufacturing and boost America's readiness for war.
Why it matters: The collaboration, at the urging of the Trump Administration, is portrayed as an effort to protect national security by strengthening the U.S. industrial base across the defense sector.
Driving the news: The two companies revealed their collaboration Tuesday at the Reindustrialize Summit in Detroit.
- Early conversations are focused on how Lockheed can leverage GM's expertise in high-rate manufacturing, digital engineering and supply chain management, Frank St. John, Lockheed's chief operating officer, told reporters at a briefing.
- Specific projects for collaboration will be identified in a few weeks, he said.
"There are a lot of similarities in the supply chain once you get down to the component level," St. John said, citing electronics components, critical materials and metals as examples, adding that workforce training is another opportunity.
- "Our focus is practical and disciplined," Bruce Brown, vice president of strategy for GM Defense, told reporters.
- "We want to identify areas where our combined strengths can help strengthen supply chains, improve manufacturing readiness and expand production capacity in ways that serve the United States and its allies well."
The big picture: Lockheed weaponry is sought globally. The Trump administration has inked several deals with the defense contractor — the largest in the world by revenue — to greatly boost production of missile defenses, like PAC-3 Missile Segment Enhancement and Terminal High Altitude Area Defense.
- To meet the Pentagon's demand to "triple or quadruple" weapons production within three to four years, Lockheed is investing $9 billion across 20 facilities.
- The deal with GM builds on these efforts so it can go even faster, St. John said.
Between the lines: Both companies acknowledged the urgency coming from the Pentagon.
- "The time is now," St. John said. "We've basically got a window here where we're going to be able to reshape what the manufacturing process looks like, not only to ramp but then also to maintain and have a resilient production capacity through the early half of the 2030s."
Zoom out: GM has a long history as a military contractor, but re-instituted its Defense subsidiary in 2017, and now sees it a growth business compared to the automotive industry, where global growth has stalled.
- GM currently produces the popular Infantry Squad Vehicle (ISV), a lightweight, diesel-powered truck for moving soldiers across rugged terrain.
- After an initial order of about 1,200 vehicles, the U.S. Army now plans to buy more than 10,000 ISVs.
- GM also makes armored SUVs including the presidential limousine known as "The Beast."
- Its electric vehicle battery technology, meanwhile, is used to support military command posts and field hospitals and will even propel lunar vehicles on the moon.
What to watch: GM's strategy is to expand its portfolio of ISV and armored vehicles, while seeking new contracts with the U.S. and allied nations.
Go deeper: Automakers, suppliers seek growth in AI data centers, defense
