US companies help global arms industry see first sales uptick since 2010, says new report

  • Global arms sales last year totaled $374.8 billion and posted the first increase since 2010, boosted in part by Lockheed Martin and its F-35 fighter.
  • Growth in weapons sales helped the U.S. increase its overall share of the arms market to nearly 58 percent last year.
  • It said South Korea is becoming a bigger player in arms production and sales as it also looks to increase its own security due to threats.

Lockheed Martin Corp.'s F-35 jet in Fort Worth, Texas.
Mike Fuentes | Bloomberg | Getty Images
Lockheed Martin Corp.'s F-35 jet in Fort Worth, Texas.

Global arms sales last year totaled $374.8 billion and posted the first increase since 2010, lifted in part by increased sales of the F-35 stealth fighter by Lockheed Martin, according to statistics released Monday by a research organization in Sweden.

The Stockholm International Peace Research Institute (SIPRI) said arms sales by Lockheed — the world's top arms producer — rose by 10.7 percent in 2016 to $40.83 billion, which it said helped the U.S. increase its overall share of the arms market to nearly 58 percent.

"With the acquisition of helicopter producer Sikorsky in late 2015 and higher delivery volumes of the F-35 combat aircraft, Lockheed Martin reported significant growth in its arms sales in 2016," said Aude Fleurant, director of SIPRI's arms and military expenditure program.

The second-largest corporate arms producer last year was U.S. aerospace and defense giant Boeing followed by Raytheon, known for making the Patriot air defense system.

Overall, the report also said last year's sales from the top-100 corporate global arms sellers was up 1.9 percent from 2015 levels, reaching $374.8 billion. It said last year marked the first year of growth in the global arms sales after five years of consecutive declines.

According to SIPRI, the combined sales of the Western European arms producers was up just 0.2 percent to $91.6 billion, although it said there were decreases in sales among top companies in France and Italy. British and German companies, however, posted increases, and the largest revenue generator in the region was U.K.'s BAE Systems.

"The UK's decision to withdraw from the European Union did not seem to have an impact on the arms sales of British companies," the report said. The researcher pointed out that BAE's sales were up about 2 percent last year and that the U.K.-based company ranked number 4 on its top-100 list of global arms producers.

Elsewhere, the combined arms sales of 10 Russian companies making the top-100 list was $26.6 billion last year, up nearly 4 percent from 2015 and just over 7 percent of the list's overall total. Russia has been getting more aggressive in the past few years selling arms to countries that are historically large buyers of U.S. weapon systems, such as Turkey and Saudi Arabia.

Chinese companies also are more active in defense sales abroad, including advanced military drones.The report from SIPRI excludes China company figures, though, because it said there a "lack of data on which to make a reasonable estimate on arms sales for most companies."

Meantime, the report also said South Korea is becoming a bigger player among so-called "emerging producers" as it also looks to increase its own security due to threats from North Korea's nuclear and ballistic missiles programs. South Korea's corporate arms sales last year reached $8.4 billion, up nearly 21 percent from 2015 levels.

"Continuing and rising threat perceptions drive South Korea's acquisitions of military equipment, and it is increasingly turning to its own arms industry to supply its demand for weapons," said Siemon Wezeman, a senior reseacher at SIPRI. "At the same time, South Korea is aiming to realize its goal of becoming a major arms exporter."