US military buildup near Venezuela boosts weapons firms: Report
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The US' naval buildup near Venezuela is benefiting weapons contractors like Lockheed Martin and RTX.
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The sun rises seen from onboard the USS Underwood in international waters near Panama on October 11, 2012. (AP)
As concerns grow that US strikes on so-called "narco-terrorists" in the Caribbean may escalate into full-scale war with Venezuela, the unprecedented scale of military buildup in the region continues unabated, with weapons manufacturers poised to benefit.
A report by Responsible Statescraft stated that among the naval assets deployed are several guided-missile destroyers equipped with the Aegis combat system, including the USS Gravely, USS Jason Dunham, and USS Stockdale, alongside the cruiser USS Gettysburg and the littoral combat ship USS Wichita. The nuclear-powered USS Newport News, capable of launching Tomahawk missiles, is also present in the area.
The recent arrival of the Gerald R. Ford carrier strike group, the US Navy’s most advanced, adds over 4,000 personnel to the theater. The carrier is escorted by the USS Bainbridge, USS Mahan, and USS Winston Churchill, joining an estimated 10,000 troops already in the region.
Washington is also reportedly scouting additional sites for military asset placement and expanding infrastructure at its former naval base in Puerto Rico, fueling speculation that the campaign may evolve into a longer-term operation.
How do weapon manufacturers benefit?
Advanced weapons systems drive costs and corporate profits
Many of the systems currently deployed carry high procurement and sustainment costs. The Arleigh Burke-class destroyers are valued at roughly $2.5 billion each. The AC-130J Ghostrider gunship costs $165 million per unit, while the P-8 Poseidon aircraft is priced around $83 million, and the LCAC hovercraft costs about $90 million.
Though most procurement contracts for these systems have already been awarded, according to Responsible Statescraft, defense contractors benefit heavily from sustainment services, which can make up as much as 70% of a weapon system’s lifetime cost.
One such example is General Atomics, which secured a $14.1 billion contract in mid-September to support the MQ-9 Reaper drone system. These remotely piloted aircraft have been actively deployed in the Caribbean since early September, conducting reconnaissance and strike operations against alleged targets in the Caribbean.
Lockheed Martin, RTX lead arms supply in the Caribbean
The so-called "Big Five" US defense contractors, including Lockheed Martin, Boeing, and RTX (formerly Raytheon), are expected to be among the largest beneficiaries of the operation. According to security policy expert Stephen Semler, these firms already secure roughly a third of all military weapons contracts and are well-positioned to profit further.
Lockheed Martin is particularly prominent in the ongoing buildup; it produces the Aegis combat systems onboard many of the warships and is the prime contractor for both the F-35 fighter jet and the AC-130J Ghostrider.
In summer, it received a $3.1 billion contract to support the Aegis system and recently announced a $50 million investment in Saildrone, which has been deploying unmanned surface vehicles in the Caribbean since February, according to the report.
Tomahawk missile demand and lobbying surge amid tensions
Several of the vessels deployed, including Arleigh Burke-class destroyers and the USS Newport News, are capable of launching Tomahawk missiles. Combined, these ships are estimated to carry at least 185 Tomahawks. At $1.3 million per unit, replenishment could yield significant revenue for RTX, the missile’s manufacturer.
The report stated that the Navy has already approved the purchase of 837 Maritime Strike Tomahawks, equipped with enhanced sensing and processing capabilities, as part of a broader ramp-up. "Beyond the immediate beneficiaries, the entire arms industry is set to profit from the buildup and prospect of war," Semler noted, adding, "Lobbying efforts will be built around the prospect of war with Venezuela, having the combined effect of driving up the Pentagon budget, thereby rewarding all military contractors."
Capitalizing on crisis
Many systems currently in use, such as the MQ-9 Reaper drones, AC-130J Ghostriders, Tomahawk-capable vessels, and emerging unmanned surface vehicles, reflect both a high-tech strategy and deep contractor integration. The expansion of military infrastructure in Puerto Rico, combined with the scouting of additional deployment sites, points to the potential for a protracted military operation.
Defense contractors have long capitalized on crises to secure large contracts and lobby for increases to Pentagon budgets, often citing geopolitical instability as justification.
What's happening?
US-Venezuela tensions in the Caribbean have escalated sharply as the United States increases its military presence in the region, prompting Caracas to prepare multiple defense scenarios and accuse Washington of hostile intent.
Venezuelan Defense Minister Vladimir Padrino López has stated that the influx of US destroyers, surveillance aircraft, and special forces in the Caribbean signals a broader strategy of coercion and territorial pressure, not just anti-narcotics operations as the US claims.
Venezuela views these maneuvers as killings and blockades without legal justification, while pointing out that international concern is rising over what is described as excessive and illegal use of force. This view is echoed by President Nicolás Maduro, who argues that US actions in the Caribbean are part of an ongoing campaign to effect regime change in Venezuela and seize the country’s vast oil reserves, warning that the military buildup poses a risk not only to Venezuela but to the entire Caribbean and Latin American region.​
