Executives and department officials stated that the Pentagon is intensifying efforts to sever US defense companies' ties with the global supply chain from China, which according to the Defense Department is using artificial intelligence to develop the technique through which it analyzes whether aircraft equipment, electronics, and raw materials used by US military contractors originate in China and other potential opponents. 

Pentagon-backed defense contractors, supported by lawmakers as well, state that they are diminishing their use of microelectronics and metals from China since the US new facilities are developing to process rare-earth minerals, most widely sourced from China.

According to the Stockholm International Peace Research Institute, China’s defense budget rose to 72% between 2012 and 2021, leading the Pentagon to identify China’s fast-expanding military as its main threat and the driving force for the Pentagon’s own expenses. 

The US is witnessing a loss in its technological advantage of satellites and missiles, pushing a budget increase on high-end weaponry systems, such as long-range missiles and nuclear submarines, and defense companies in the US are anticipating an even further increase in military spending due to the excessive weapon shipments from Western countries to the war in Ukraine - the US ranks among the top suppliers. 

Pentagon leaders disclosed that with sanctions impeding the delivery of supplies, depending on China for circuit boards or Russia for titanium would be of no use, which comes after the Defense Department stopped accepting F-35 combat jets manufactured by Lockheed Martin Corp. due to the information received that magnets sourced from Honeywell International Inc. with metal alloys produced in China are assembled in them. 

In response, Honeywell reiterated its commitment to supplying high-quality products, as Lockheed Martin emphasized that production is maintained at its plant located in Fort Worth, Texas, while the Pentagon expects a waiver to be issued allowing F-35 deliveries to resume.

Just on September 8, after Lockheed Martin discovered that a metal component used in the F-35 jet's engine is manufactured in China, it temporarily suspended the delivery of the jets to military branches and international buyers, according to the company. 

The Pentagon’s acquisition chief, Bill LaPlante, said at a media conference on September 9 that an ongoing investigation is intended to demonstrate that Chinese alloys don't contribute negatively to the security or flight effectivity of the F-35 but that this exposed persistent vulnerabilities in the defense supply chain. He further added, “Any company that says they know their supply chain is like a company that says it hasn’t been hacked." LaPlante also showcased the new “supply-chain illumination,” which employs artificial intelligence and various tools to track raw material sources in real time.

Statements by Air Force and Army acquisition officials claim that in recent months, attempts to diminish the use of Chinese material did not impede the course of any programs. However, during former US President Donald Trump's presidential term, worries over what they claimed are flaws in Chinese electronics and raw materials were heightened as studies conducted by the Pentagon exhibited increased dependence on foreign suppliers. In a survey by consultant Govini, a unit of Poplicus Inc, a shock was revealed as the number of Chinese companies in the Pentagon’s supplier base shot up more than five times to 655 between just 2012 and 2019. 

According to Pentagon officials, China accounts for 80% of rare-earth elements (sometimes referred to as technology minerals) to the US, whose purpose is used in magnets for weapons-guidance systems, as well as electric-vehicle batteries. 

China invested massively in mining, computer chips, and refining rare earth material over the past decades, driving it to dominate the global supply chain, but the Covid-19 pandemic highlighted the fragility of supply chains even for high-end weapons. 

In an attempt to revive domestic production, two contracts to Lynas Rare Earths Ltd. have been awarded for the initiation of a US refinery with materials imported from Australia, such as rare-earth minerals but with the potential to source domestic supplies, since competing with China forced two US rare-earth mines, in Texas and California, to shut down in the past decade. Amanda Lacaze, chief executive of the Australian company, confirmed that the refinery is bound to open by 2025 in Texas. 

The plan to elevate domestic manufacturing has been advocated by defense contractors and lobbyists, but some have concerns regarding the cost of compliance and the length it could take for the effort to have an effect. The next defense authorization act holds a potential bill to prohibit the usage of any Chinese rare-earth minerals after 2027. The pursuit for printed circuit boards, alongside increased government funding for domestic plants and tracing systems that would guarantee the security of semiconductors, is also in the works for the same timeframe.