By Mike Stone
WASHINGTON, June 24 (Reuters) - U.S. President Donald Trump is set to meet munitions makers at the White House on Wednesday as his administration pushes to expand weapons production after military operations in Iran and other conflicts drew down U.S. stockpiles.
The United States has supplied large quantities of weapons to allies while also using munitions in its own military operations, raising concerns about inventories of key air-defense and precision-guided weapons and increasing
pressure on contractors to boost output.
The meeting would mark the second White House gathering with chief executives of major defense firms focused on ramping up weapons production. A March meeting included the CEOs and other officials from BAE Systems, Lockheed Martin, Northrop Grumman, RTX Corp, Boeing, Honeywell Aerospace and L3Harris Technologies, along with Defense Secretary Pete Hegseth.
The meeting comes as Pentagon negotiators press contractors to move much faster, with tentative production agreements struck earlier this year at the center of those efforts.
The agreements include a deal with Lockheed Martin to triple production of Patriot interceptors and quadruple output of THAAD interceptors, which are used to shoot down ballistic missiles. Separate multiyear deals with RTX aim to boost production of Tomahawk cruise missiles and AMRAAM air-to-air missiles. The deals, announced as "framework agreements," have yet to be converted into contracts.
Five defense industry executives, speaking on condition of anonymity, welcomed the agreements, but said Congress must first appropriate funding before companies can invest more heavily in components and production capacity. Investing before receiving government payments under the agreements would weigh on free cash flow and could hurt second-half earnings, they said.
The administration has steadily increased pressure on defense contractors to prioritize production over shareholder payouts. Trump signed an executive order in January to identify contractors deemed to be underperforming on government contracts while continuing to distribute profits to shareholders.
GM Defense, the automaker's defense business unit, and Lockheed have said the U.S. Department of Defense helped facilitate a partnership between the two companies because of growing demand for additional production capacity.
The Senate Armed Services Committee this month approved its version of the National Defense Authorization Act, backing total defense spending of $1.15 trillion and providing multi-year procurement authority for several types of munitions and weapons. The bill is not expected to become law until autumn, although separate appropriations or supplemental funding could come sooner.
Demand for air defense systems has surged among the United States and its allies amid heightened geopolitical tensions and the conflict in Iran.
(Reporting by Mike Stone in Washington; Editing by Sanjeev Miglani)
