US President Donald Trump has publicly called for raising the 2027 US defense budget to US$1.5 trillion, a sharp increase of more than 50% from the current US$901 billion. In a social media post, Trump highlighted that this funding increase is necessary to build a "Dream Military" in "these very troubled and dangerous times."
On social media, Trump further stressed that this massive military spending could be easily funded through tariff revenues, and criticized major defense contractors such as Raytheon, Lockheed Martin, and Northrop Grumman for prioritizing shareholder dividends and stock buybacks over prompt delivery of weapons systems and investing in production.
Trump singled out Raytheon as the slowest to respond and expand capacity, and threatened to cut its government contracts unless it halts stock repurchases and increases factory equipment investment. According to Military Times, Raytheon's portfolio includes Tomahawk cruise missiles, Javelin anti-tank missiles, and Stinger air-defense missiles, and it owns Pratt & Whitney, the engine maker for the F-35 fighter. Trump also demanded that Raytheon limit its salary for top executives to US$5 million, to curb excessive compensation and prioritize capacity building.
Data from the Bipartisan Policy Center shows that the US government collected US$288.5 billion in tariffs and other consumption taxes in 2024, up from US$98.3 billion in 2023. The increase in import tax revenue exceeded expectations, but is still not enough to cover Trump's promises of taxpayer dividends, debt repayment, and increased military spending.
Analysts see Trump's remarks as an effort to cement US military dominance, while pressuring the defense industry to boost supply chain efficiency.
Lockheed Martin ramps up Patriot missile production amid surging demand
Even as Trump called on US military contractors to expand capacity, Lockheed Martin has announced an agreement with the Department of Defense to significantly increase annual production of the PAC-3 Missile Segment Enhancement (MSE) variant of the Patriot air-defense missile system. Over the next seven years, output will rise from about 600 missiles per year to approximately 2,000.
Lockheed Martin said this capacity boost will make use of new molds, expanded testing facilities, and a vast network of over 13,000 suppliers. The company expects these measures to strengthen and expand production across its supply chain to meet growing market demand for air-defense missile systems.
According to Defence Blog, the PAC-3 MSE interceptor is one of the most advanced air defense systems currently deployed by the US and its allies, which have seen increasing pressure on their air defense inventories due to ongoing conflicts and efforts to expand missile defense coverage.
Furthermore, the US has in recent years transferred Patriot systems and PAC-3 MSE missiles to its allies, further driving Lockheed Martin's need to ramp up production to replenish stocks and fulfill new orders worldwide.
Article edited by Jerry Chen
