It’s hardly surprising that armaments manufacturers, long ostracized in public opinion, are now doing particularly well. In view of the war in Ukraine and the efforts of the NATO countries to equip Ukraine with modern weapons. In view of politicians like Olaf Scholz, who are proclaiming a “turn of the tide” and professing that they want to give the military much more importance again in the future.
However, the figures that the Stockholm-based peace institute Sipri has now presented relate to 2021, so the changes resulting from the war in Ukraine are not included. The 100 largest defense companies in the world sold weapons and military services worth almost 600 billion US dollars last year, which is the equivalent of a little more than 560 billion euros.
This is the seventh year in a row that sales from military businesses have grown. The plus for 2021 is 1.9 percent. It could have been even higher, says Sipri researcher Lucie Béraud-Sudreau, if the aftermath of the Corona crisis had not existed: interruptions in the global supply chains of the arms industry, delays in shipping and Bottlenecks in essential materials. According to the Sipri experts, some armaments companies such as Airbus and the US company General Dynamics also lacked workers.
The database with which the institute documents the development of the international armaments business has existed for more than 30 years. Initially, only the corporations in the western world were recorded, since 2002 also the armaments industry in Russia, since 2015 those in China. The data includes sales of heavy weapons and military services to domestic and foreign military customers. In relation to Germany, for example, both the procurement of the Bundeswehr from local armaments companies and armaments exports abroad are recorded.
US corporations account for 50 percent of global arms sales
US arms companies have by far the largest global market share. 40 companies from the United States can be found in the Sipri list, together they generated almost 300 billion US dollars in 2021, about half of global sales in the arms business. The largest defense company in the world is Lockheed Martin with a turnover of more than 60 billion US dollars.
company from China account for the second largest share of the global armaments business with 18 percent. The eight Chinese armaments companies represented in the Sipri ranking are estimated to have earned almost 110 billion US dollars last year. That is 6.3 percent more than in 2020. According to the experts in Stockholm, China is modernizing its military equipment and trying to become self-sufficient in the manufacture of large weapons.
The six military companies featured on the ranking list Russia achieved sales of almost 18 billion US dollars in 2021. According to the peace researchers, Russia is currently having problems with production due to war-related sanctions by the USA and the EU.
the 27 European companies in the list of the 100 largest defense companies sold weapons and other products worth just over $120 billion.
The four German companies Rheinmetall, Thyssenkrupp, Hensoldt and Diehl sold weapons and armaments worth 9.3 billion US dollars, i.e. around 8.9 billion euros, last year, which is an increase of 5.6 percent compared to the previous year. According to Sipri, the largest German arms manufacturer remains Rheinmetall with a turnover of 4.5 billion US dollars. The sales of German companies make up 1.6 percent of the arms and armaments sold worldwide.
How the war is affecting Ukraine
Even if there is only preliminary data and a rough estimate so far, the information provided by the Sipri experts for 2022 shows two opposing developments. On the one hand, the sales of European armaments companies in particular are likely to increase as a result of the Russian war of aggression.
On the other hand, the supply chain problems are likely to continue. Russia is a “major supplier of raw materials for weapons production,” as the Sipri experts write. These include aluminium, copper, steel and titanium. So the lack of raw materials could hamper the efforts of European armies to modernize their arsenal and build up new stockpiles of ammunition after some of the material is sent to Ukraine. “If supply chain disruptions continue, it could take several years for some of the largest arms producers to meet the new demand created by the Ukraine war,” says Sipri researcher Diego Lopes da Silva.