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NEWS > BUSINESS > ECONOMIC DOWNTURN FORCES WEAPONS MANUFACTURERS TO PRODUCE LESS EFFECTIVE BULLETS

ECONOMIC DOWNTURN FORCES WEAPONS MANUFACTURERS TO PRODUCE LESS EFFECTIVE BULLETS

November 9 2008

Washington, D.C.  – With the continuing economic slide throughout the United States, one industry seen as largely invulnerable to the distress has begun feeling the pinch. Reports from inside weapons manufacturers Boeing and Lockheed Martin have hinted that they, along with other US weapons developers, have been forced to use lower grade materials in order to meet ever decreasing profit margins.

The bulk of the changes have come in munitions such as missiles, grenades, and bullets. The manufacturing processes for vehicles and other hardware has so far been left unchanged.

“Most military bullets use a copper jacket, but the rising costs have forced most companies to go with aluminum and usually at a lighter density,” said an insider who preferred to remain anonymous. “From what I understand they don’t provide any more risk to the user, but they are also less effective against targets, so it will take a few more shots to take someone down.”

Using lower grade materials not only reduces costs, but also increases the demand for bullets which is expected to add significantly to the bottom line for the manufacturers who have not been able to secure the types of government bail outs that other industries have enjoyed. The industry is also concerned about plans by President-Elect Barack Obama to withdraw troops from Iraq.

“Obama plans to reduce the overall number of field combatants, while adding troops into Afghanistan. The hard truth is there is a whole lot less fighting going on there and that is going to cause a major dent in production,” continued the insider. “Soldiers need people to kill people and if they pull out of Iraq there’s going to be a whole lot fewer of them. The cold hard reality is a lot of people in America are going to be out of work if we pull out of Iraq, and of course stocks will drop.”

Both Boeing and Lockheed Martin are also reportedly looking into new conflicts, whether American or not but are being hampered by laws which restrict sales of weapons to foreign governments and militant organizations.

“Burma is out, Congo is a PR nightmare, and countries like India and Pakistan have these burgeoning weapons industries of their own. The only thing they can hope for is a flare-up in between Israel and Palestine,” continued the insider. “There has never been an economic driver for this industry like the Middle East. Everyone is hoping and praying that something pops up there otherwise the industry is going to be in tough. These people have mouths to feed.”

The prospects of a continuing war or another conflict entirely coming along to buoy the weapons industry does not seem likely. With the calmer tone of the incoming President and the scaling down of threats from countries like North Korea and Iran the world is becoming a much calmer place.

“It’s going to be a tough row for many in the industry but there will be an upturn eventually, there always is,” said Scrape TV business analyst Ken Green. “Armed conflict has always been a viable industry from the earliest days of stone weapons. It’s unlikely that the depressed state will stay for long. We may just have to think outside the box for future conflicts. Fighting for oil or battling communism is the old guard of conflict and it’s time for some fresh thinking. We also need to be looking outside the traditional theatres. For future growth and to continue the type of boon that the industry has had over the last eight years they are going to need to get creative.”

Some areas suggested for growth include sub-Saharan Africa and South America, bith of which have a large underground arms dealing economy.

“Both of those areas have remained largely unexplored by foreign powers in recent years,” continued Green. “And both have significant populations which make an ideal environment for sustained armed conflict, which will lead to increased revenue. They'll have to deal with the independents, but of course they make bullets so that shouldn't be too difficult.”

William Ashford, Business Correspondent

NEWS > BUSINESS > ECONOMIC DOWNTURN FORCES WEAPONS MANUFACTURERS TO PRODUCE LESS EFFECTIVE BULLETS

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