Home / News / World /  Pentagon refocuses spending on weapons to deter China

WASHINGTON—The Pentagon unveiled plans on Monday to boost spending on munitions to deter China and backfill supplies sent to Ukraine, though contractors are still struggling to hire staff to match extra demand.

The fiscal 2024 budget request includes a 12% rise to $30.6 billion in planned spending on missiles and rockets and the factories to build them in an effort to catch up on years of deferred purchases.

The Pentagon wants to mitigate the shortages exposed by the conflict in Ukraine, which risks diluting its concurrent effort to deter China. The bump in planned spending on munitions focuses on higher-end missiles—including hypersonic weapons and defenses against them—aimed at countering Beijing’s military buildup. The Pentagon says China remains its “pacing threat."

Contractors have already pledged to double the manufacture of Javelin antitank missiles and Himars rockets and launchers being used in Ukraine, but labor and parts shortages have pushed out achieving those levels to 2026, even with additional spending.

“We are buying to the limits of the industrial base even as we are expanding those limits," Deputy Secretary of Defense Kathleen Hicks said at a media briefing on Monday.

To encourage high production in the U.S. and abroad, the Pentagon is counting on additional spending and bulk-buying of weapons with multiyear deals of the sort usually reserved for ships and aircraft. Analysts expect significant barriers to Congress agreeing on the Pentagon spending given broader disagreement over the federal budget deficit.

The Pentagon budget request for $842 billion is a 3.2% increase on what Congress enacted last year, below the top end of analysts’ expectations. Growth slows from the fiscal 2023 request, and with inflation running around 5% the proposal represents a cut in real terms. Additionally, the administration requested $7 billion for further military support for Ukraine and $23.6 billion for the Energy Department as part of the modernization of sea, land and air-based nuclear weapons.

Aid to Ukraine will come in the form of supplemental requests to Congress for additional funds to provide weapons directly and replenish U.S. and allies’ stocks, said Mike McCord, the Pentagon’s chief financial officer.

The forward guidance for the government’s fiscal year 2025 and beyond calls for a further flattening of budget growth, drawing attention to the choices the Pentagon and Congress face in the coming years. These include retiring older planes and ships to make way for modern platforms such as uncrewed aircraft and space assets aimed at countering the rapid expansion of capabilities by potential adversaries such as China.

Shares in defense companies have weakened this year on concerns about a flat longer-term Pentagon budget. Lockheed Martin Corp., the world’s biggest weapons maker by sales, expects revenue to shrink this year before resuming growth.

Contractors look at the Defense Department’s procurement budget, which the latest Pentagon request boosts to a record $170 billion, with another $145 billion earmarked for research and development.

A large part of this focuses on the refresh of the U.S. nuclear deterrent, which includes B-21 bombers, the new Columbia-class ballistic missile submarines and the Sentinel ground-launched missiles that will replace the aging Minuteman fleet.

Write to Doug Cameron at Doug.Cameron@wsj.com

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