Sales of weapons and military services by the world’s biggest arms companies have continued to rise during the downturn and now exceed US$400 billion, a leading independent research body has reported.
Although the increase has slowed to 1 percent year-on-year in 2010, the rise in sales has been 60 percent in real terms since 2002, figures released by the Stockholm International Peace Research Institute showed.
The total sales, including military services, of the top 100 arms companies, reached US$411.1 billion in 2010, the institute said.
However, its report did not include Chinese arms supplies worldwide and has only limited data on Russian arms manufacturers, who are vying with US firms in Latin America and other arms markets.
The global arms industry is also increasingly concentrated, through mergers and acquisitions, and the top 10 arms producing companies now account for 56 percent of sales — US$230 billion — institute said. Significantly, the entry point for inclusion in the top 100 companies rose from US$280 million worth of sales in 2002 to US$640 million in 2010.
“The data for 2010 demonstrates, once again, the major players’ ability to continue selling arms and military services despite the financial crises currently affecting other industries, said Susan Jackson, the institute’s arms industry expert.
The report highlighted Oshkosh, a US company, which recorded an 87 percent sales increase after winning the contract for the US mine-resistant ambush-protected all-terrain vehicle. Sales by Vertolety Rossii, a Russian helicopter-maker, rose more than 135 percent following sales to the Russian military, Afghanistan, Azerbaijan and Iraq.
US-based Lockheed Martin heads the institute’s list of the top 100 arms and military service companies, with US$35.7 billion worth of arms sales in 2010, followed by Britain’s BAE Systems (US$32.8 billion), and US firms Boeing (US$31.3 billion) and Northrop Grumman (US$28.5 billion).
Though the figures show arms sales have been thriving, the next few years do not look so profitable for weapons makers, at least those who depend on the US and European markets. The withdrawal from Iraq and Afghanistan after 2014 could lead to fewer orders.
BAE, Europe’s biggest arms company and Britain’s largest manufacturing employer, warned last month of “little sales growth” this year with US and UK military spending cutbacks leading to a 14 percent fall in revenues last year.
The company reported a fall in sales to £19.2 billion (US$30.5 billion), as a result of lower demand for US army vehicles and a £500 million reduction in turnover from the UK Ministry of Defence.
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