Page 45 - Five Forces of Americanisation Richard Hooke 04072025 final post SDR1

The UK Defence Industry in the 21 Century
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The Five Forces of Americanisation

In 2005, UK and US forces were entrenched in the war in Iraq, then in its third year. Supplying our
warfighters was the priority but consolidation still also preoccupied a defence industry that faced a
dramatic reduction of over 30% in post-Cold War defence spending worldwide. UK defence companies
started looking for prospective partners to acquire or merge with, mindful of the UK government’s
edict that its armed forces must be “interoperable” with its US partners. 24 of the world’s 100 largest
companies in 1990 had left the industry by 1998. More than US$55bn worth of mergers in the US
alone reduced the number of industry players there from 40 to just five. The trend seemed
irreversible.
Sustaining one of the world’s most respected defence capabilities appeared to be a major American
imperative. However, the undeniable strength of the UK’s DIB at that time, winning and delivering Al
Yamamah, for example, together with joint US-UK operations in Iraq and a continuing history of UK
technology transfer to America (embodied, at that time, by the Joint Strike Fighter (“JSF”) programme)
offered the UK a rare opportunity to act assertively in forming a more equal alliance with the US. A
realistic partnership that would involve sharing technology and industrial capability as well as the
capabilities of their respective armed forces.
Instead, the UK government, its stance on the defence industry still rooted in the doctrine of
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competition established by the “Levene Reforms” and enmeshed in the adversarial relationships
between customer and supplier this provoked, declared that it would not involve itself in the
“international restructuring” of the nation’s defence industry.
“The DIS (the UK Defence Industrial Strategy) does not seek to set out a preferred route to
international restructuring: that is very much industry’s business”
(Defence Industrial Strategy White Paper, December 2005)
The UK defence industry duly complied, with the result that ownership of much of the UK’s DIB has
now moved overseas, notably to America. In the meantime, defence companies that are still UK-
owned now locate many, if not most, of their operations in the USA, still by far the largest defence
market in the world. The ensuing drain of technology, jobs and shareholder funds offshore, mainly to
the USA, has created a situation where UK industry is considered by its Parliament as “unprepared for
high-intensity, prolonged conflict” and that MoD procurement was “repeatedly wasting taxpayers’
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money” .
“Our Armed Forces will need to be interoperable with US command and control structures, match
the US operational tempo and provide those capabilities that deliver impact when operating
alongside the US.”
(“Delivering Security in a Changing World”: UK Defence White Paper (December 2003)
The fact is that US systems and equipment remain the standard for many European countries and the
physical presence of American companies in Europe – from Spain to Germany and the UK – is a source
of pride to most defence agencies keen to secure best-in-class capabilities. And, since it still spends
more on defence than the rest of the world, the US is entitled to consider its industry as the world
leader. It is clearly sensible then for European contractors to view the US as an attractive market and
its contractors as desirable partners. This is a widely held view, shared by both the UK government
and European industry.
“The security and prosperity of the Euro-Atlantic will remain our core priority, bolstered by a
reinvigoration of our European relationships.”
(Integrated Review Refresh 2023 “Responding to a more contested and volatile world” HM
Government; March, 2023)
Even as Prime Minister Keir Starmer signed military accords with his French and German counterparts
in 2024, all recognised that any consolidating move between European parties will need to address its
likely impact upon US activities, aspirations and support, both bilaterally and within NATO.

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07/07/2025 Richard Hooke 2025