By Andy Pasztor and Doug Cameron
Defense and aerospace companies are accelerating plans to
develop new types of missiles and satellites in an effort to
capitalize on President Trump's proposed military branch devoted to
space warfare.
Even before the administration's plans for a "space force" were
announced earlier this month, Pentagon space spending was on the
rise, in part to combat the rising threat to U.S. satellites from
Chinese and Russian technology, which the U.S. military has been
tracking for years.
Space projects could see larger shifts of money as debate over
the president's space-force plan increases public awareness of the
military's drive to speed up deployment of next-generation space
equipment.
The increased budget is attracting the attention not only of big
companies like Boeing Co., Northrop Grumman Corp. and Lockheed
Martin Corp. but also smaller ones like information-technology
specialist Booz Allen Hamilton Holdings Corp. Companies are
prioritizing the development of fast, highly maneuverable missiles;
technology to detect hostile missile launches; small,
more-resilient communications satellites; and processing data from
new sensors.
Getting less attention in the budget is traditional space
hardware, such as bigger satellites that typically have taken
longer to build and deploy.
Existing military space efforts are focused through the Air
Force, which has said it wants to spend around $44 billion on
unclassified space research, development and new equipment over the
next five years -- nearly 20% more than its prior guidance in 2017.
While the projections were made before the president's space-force
plan, much of the money could end up shifted to the new branch if
Congress approves it.
The totals don't include expected funding boosts to classified
projects, outside usual public oversight, which have been among the
fastest-growing slices of the defense budget.
Boeing Chairman Dennis Muilenburg told Wall Street analysts
earlier this year that he was encouraged by the Trump
administration's "sustained funding and support" for military and
civilian space programs. "We do see it as an important business
segment for our future," he said.
Proponents argue the changes to the space budget are essential
to counter evolving Chinese and Russian technology capable of
blinding, jamming or possibly even destroying American surveillance
and communications satellites. U.S. intelligence officials have
publicly criticized Beijing for aggressively pursuing antisatellite
weapons and for setting up military units specifically trained to
attack foreign satellites.
Because of the overseas threat, top candidates for additional
funding include research on swarms of space-based sensors able to
detect hostile missile launches and, ultimately, potential
deployment of advanced orbiting lasers designed to defend a variety
of military spacecraft.
Regardless of the project, proponents predict more focus and
dollars will go to build and test prototypes. They are intended to
demonstrate technical capabilities and flag future production
problems more quickly than the Air Force's traditional,
time-consuming hardware development and acquisition process.
Air Force Gen. John Hyten, head of Strategic Command, which
oversees the nation's nuclear weapons, repeatedly has lamented the
lumbering pace of replacing missile-warning and other types of
satellites. "I don't know how it happened, but somehow this country
lost the ability to go fast," he said last December.
Companies that stand to profit include Lockheed Martin, which
recently snared contracts totaling more than $3.3 billion to
develop new fleets of missile-warning satellites and highly
maneuverable hypersonic missiles, able to reach targets at speeds
faster than five times the speed of sound. Boeing recently bought
Millennium Space Systems, a small-satellite maker that analysts
said will help it downsize from school bus-size satellites.
Senior officials at rocket-motor specialist Aerojet Rocketdyne
Holdings Inc. have said the company stands to benefit from
unprecedented interest in hypersonic vehicles. Industry officials
see Northrop Grumman, with its long and close ties to the
intelligence community, gaining from stepped-up spending on
missile-warning and cutting-edge spy satellites. At the same time,
service providers such as Booz Allen are bound to grow with the
steadily increasing flow of data streaming from space, according to
defense analysts.
Some industry executives are optimistic about the potential of a
new space force to unlock extra resources and savings by
coordinating spending and making more use of cheaper commercial
technology, when appropriate.
"That will only drive more investments in the area," said Bill
Brown, chief executive of Harris Corp., which makes sensors and
communication equipment. "There are tremendous opportunities [for]
growing in the classified" arena.
Lawmakers are unlikely to vote on the president's space-force
plan until next year, and even if it is approved, implementation is
bound to take years. So far neither military nor White House
officials have provided specifics on the plan, and bipartisan
opposition on Capitol Hill appears to be building to the projected
cost and disruption of standing up an entirely new uniformed and
civilian chain of command. The success of any space force would
depend partly on the extent of participation by the intelligence
community.
And even though a space force could lead to more business, some
contractors and military leaders say they are worried the move
threatens to drain dollars already earmarked for space hardware
into staff, support and operational accounts.
No matter the outcome, the Pentagon appears focused on quickly
developing its new space defenses.
"We've told all of our contractors" the military simply won't
support "more exquisite, one-off science [experiments]" that block
rapid deployment, Air Force Secretary Heather Wilson said last
year.
Write to Andy Pasztor at andy.pasztor@wsj.com and Doug Cameron
at doug.cameron@wsj.com
(END) Dow Jones Newswires
August 24, 2018 13:24 ET (17:24 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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