US defense industry could struggle to sell to new German government: Analysts
Though he has still to formally take up office, Freidrich Merz, the CDU’s choice for chancellor, has proposed securing “independence” from the US, criticised “America first” doctrine and said he is prepared for the “worst case scenario” implying a future where the US would no longer be considered a trusted ally.
Soldiers participate in Saber Junction in Hohenfels, Germany, Sept. 13, 2024. The exercise is designed to assess readiness to execute unified land operations in a joint, combined environment (US Army)
BELFAST — Germany’s conservative CDU/CSU-led government in waiting, and Europe’s urgent plan to rebuild its military capabilities through self-reliance, puts US industry and future orders from Berlin on shaky ground long term, a trio of analysts tell Breaking Defense.
Notably, those concerns include whether Germany will stay the course on an $8.8 billion order for Lockheed Martin F-35A fifth generation fighter jets.
Though he has still to formally take up office, Friedrich Merz, the CDU’s choice for chancellor, has proposed securing “independence” from the US, criticized President Donald Trump’s “America first” doctrine and said he is prepared for the “worst case scenario,” implying a future where the US would no longer be considered a trusted ally. Additionally, he has publicly called for Ukraine to be part of peace negotiations with Russia, pushing back on the White House decision to exclude Kyiv and European nations from proceedings.
On Sunday, Merz told German television, “After Donald Trump’s remarks last week, it is clear that the Americans, at any case the Americans in this administration, do not care much about the fate of Europe,” adding, “This is really five minutes to midnight for Europe.”
The US has since opposed a UN resolution condemning Russia’s invasion of Ukraine and sided with Moscow a second time by drafting another resolution, passed by members, which called for an immediate end to the conflict but without any criticism of Russia.
Merz on the other hand has kickstarted German armed forces modernization plans by opening up discussions with the Social Democrats around a €200 billion emergency defense fund, Bloomberg reported on Monday.
Amid such moves, posturing and strategic thinking rests the F-35 order, comprising 35 aircraft, and a collection of other highly lucrative US contracts, including Boeing P-8A Poseidon Maritime Patrol Aircraft (MPA), CH-47F Chinook heavy-lift helicopters and RTX Patriot air defense systems.
Assessing the level of cancellation risk tied to the four major orders, JJ Gertler, a senior analyst at the Teal Group, told Breaking Defense, “The most significant existing contract in which there may be buyer’s remorse and an attempt to go a different direction is the German commitment to F-35.”
He put the stealth jet at the top of the list as it demands “an ongoing relationship with the United States, because of their presumed access to all of the data going to and from the airplane,” and added “it is not a one-time purchase decision like some of these other systems, and the US’ reliability as a partner has to be considered more seriously.”
Similarly, Richard Aboulafia, managing director at AeroDynamic Advisory, a consultancy firm, said that “the most survivable US export programs are the ones that need the least care and feeding from the US, and can be sustained with in-country resources. The F-35 is incredibly dependent on a constant stream of upgrades and parts.”
Offering an opposing view, Jim Townsend, adjunct senior fellow in the transatlantic security program at the Center for a New American Security thinktank, said that the F-35 order is “safe,” largely because Germany has “no other option” but to acquire the aircraft to replace retiring Panavia Tornados.
