While many sectors, such as the automotive and tourism industries, are still feeling the effects of the Coronavirus epidemic, others seem to be completely overwhelming this global crisis.

This is the case with the global armaments giants.

The turnover of the hundred largest groups in the defense sector thus reached a new high in 2020 of 531 billion dollars (470 billion euros), of which more than half by American companies, according to a report by Stockholm International Peace Research Institute (Sipri) released Monday.

This represents a 1.3% increase over one year in their sales of arms and military services while at the same time the world economy has fallen by more than 3%, points out the Swedish-based research organization. whose work is the benchmark in this area.

The turnover of the hundred largest armaments groups has been rising steadily since 2015, with a total increase of 17%, according to Sipri.

French exception with a decrease of 7.7%

Growth was weaker in 2020, however, than in 2019, when the top 100 saw sales jump 6.7%.

With the exception of Russian companies (-6.5% of sales) and French (-7.7%), the other main nations saw their large companies grow last year.

Five American giants once again monopolize the top of the world ranking: Lockheed-Martin (F-35 combat aircraft, missiles, etc.) consolidated its first place with arms sales of $ 58.2 billion, ahead of Raytheon Technologies again number two after a major merger, then Boeing, Northrop Grumman and General Dynamics.

The British BAE Systems is the first European (6th) with Airbus (11th).

The Chinese Norinco (7th) Avic (8th) and CETC (9th) and the American L3Harris (10th) complete the top 10.

Disrupted supply chains

According to the institute, the good resistance of large companies to the difficult economic situation in 2020 is explained in particular by the budget support policies taken in the face of the pandemic and the effects of lockdowns. The sector "has been largely protected by the continued demand from governments for military equipment", underlines Sipri. The armaments market, characterized by orders spread over several years, is also less sensitive to economic fluctuations.

But the defense industry has not been totally immune to Covid, especially on the industrial side.

"In many cases, measures taken to curb the virus have disrupted supply chains and delayed deliveries," Sipri notes.

The report thus cites the case of Thales, the leading French company - excluding Airbus - in the ranking (14th), which attributed to confinement the 6% drop in its 2020 turnover. Logistics supply problems having multiplied in 2021, "it is possible that these difficulties are reflected in their sales" this year, as Lockheed Martin provides for example, underlines Lucie Béraud-Sudreau, responsible for monitoring military spending at Sipri.

China, a new major producer

Behind the 41 US companies in the Top 100 and their share of 54%, 26 European companies captured 21% of total sales.

China (13% of the total, with five companies) and Russia (5%, nine companies) follow.

When counting the European countries separately, China is the second country and the United Kingdom third (seven companies, 7.1%), ahead of Russia (nine companies, 5%) and France (six companies, 4.7% ).

"China's progress as a major arms producer has been driven by its desire to become more self-dependent in its production and because of ambitious modernization programs" of its armies, underlines Sipri.

About fifteen other countries are home to companies appearing in the world's Top 100: Japan (5), Germany and South Korea (4), Israel and India (3), Italy (2) as well as Canada, Singapore, Turkey, Sweden, Poland, Spain, Ukraine and the United Arab Emirates (1).

Many groups also having civilian activities, such as Boeing or Airbus, only their military sales are recorded by Sipri.

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  • epidemic

  • Covid 19

  • Coronavirus

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  • Army

  • Armament

  • Weapons

  • Economy

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