Home / News / Defense Contractors Making Shift to Services

Defense Contractors Making Shift to Services

Photo: DoD/Ken Hammond
Photo: DoD/Ken Hammond

Many defense contractors are no longer solely focused on large industrial manufacturing, such as building planes or tanks.

Much like the rest of the U.S. economy, they are adjusting to the service sector, offering top-notch expertise in fields such as security and intelligence.

Fearing a “realignment” of Defense Department spending, Washington-area defense contractors have also embarked on a bevy of mergers and acquisitions in those specialty fields, The Washington Post reports.

The big buys, such as BAE Systems’ recent purchase of L-1 Identity Solutions Intelligence Services, reflects the broader shift by defense contractors toward services.

BAE, like many others, “is in transition from being a metal bender to a services provider,” Loren Thompson, a defense industry consultant with the Lexington Institute, told the The Post.

The M&A moves are seen across the spectrum of both large and small companies, and will likely continue — at least until next year’s defense budget is released.

Then, these companies will see where they stand.

Check Also

Merit Systems Protection Board Seeks Increase From President’s Budget Request

The Merit Systems Protection Board filed a bypass request with Congress seeking $46.8M in funds for 2020, reflecting a $4.6M increase from the president’s proposed budget. MSPB said in its congressional budget justification the president’s budget request of $42.3M represents a 10 percent cut to the board’s current funding level and would result in a workforce reduction if enacted.

Leave a Reply

Your email address will not be published. Required fields are marked *