Defense & Aerospace Report

On this week’s Defense & Aerospace Report Business Roundtable, sponsored by Bell, Dr. “Rocket” Ron Epstein of Bank of America Securities, Sash Tusa of the independent equity research firm Agency Partners, and Richard Aboulafia of the AeroDynamic advisory consultancy join host Vago Muradian to discuss an up market despite tariff threats and rising inflation that will forestall more interest rate cuts; President Trump and his team sent shock waves across Europe after announcing direct talks with Russia to end the Ukraine war without European or Ukrainian participation, promising to arm Kyiv in exchange for half its rare earth mineral deposits, rejecting AI cooperation with allies, and working to normalize hard-right parties; whether Europe can step up as quickly as needed to both support Ukraine and address its own weapons needs; Trump says he’ll strike a deal with China and Russia to halve US defense spending as Congress works to increase spending by $100 billion or more dollars over the coming years; Defense Secretary Pete Hegseth says he’ll shift 8 percent of Pentagon spending to new priorities as he issued his 2026 budget guidance to the military services with savings to be found in “low impact, wasteful, DEI and climate programs,” anything related to the border is off limits as are nuclear attack submarines, large and small unmanned aircraft including the Collaborative Combat Aircraft, but manned planes like F-35 Lightning II fighters, aircraft carriers and even the Future Long-Range Assault Aircraft could be targeted; US arms exports hit a record high, but as Hegseth pledges to reform the Foreign Military Sales system to foster more deals, some question whether allies who worry that Washington won’t back them might not keep buying; the administration tells US firms they won’t be punished if they bribe foreign officials; and what to expect as Airbus — and other European firms — report earnings next week.

On today’s program, sponsored by HII, Byron Callan of the independent Washington research firm Capital Alpha Partners and Chris Servello, the co-host of our Cavas Ships podcast joins Defense & Aerospace Report Editor Vago Muradian to discuss a week that sent allies and partners scrambling as President Trump moves to end the Ukraine war, rehabilitate Vladimir Putin, support Kyiv only if it hands over right to half its rare earth mineral deposits, and his team encourages hard right parties in Europe; Trump’s suggestion that a deal with Russia and China would allow defense spending to be cut by 50 percent; 25 percent tariffs on aluminum and steel; after a few strong messaging weeks, the administration’s game slips; Defense Secretary Pete Hegseth’s drive to reallocate 8 percent of the Pentagon budget for new priorities contained in his 2026 budget planning guidance to the military services that would protect border, strategic deterrent programs, nuclear submarine and unmanned efforts, but would target the F-35 Lightning II fighter and other manned platforms as well as Army programs to pay for the “Iron Dome” air and missile defense system; Callan’s four scenarios to consider in light of the current chaos; an update on the collision between USS Harry S. Truman and a the merchant bulk carrier Besiktas-M on the entry to the Suez Canal; and a look at the week ahead.

Michael Herson, a lobbyist at American Defense International, joins Jim Townsend, former Pentagon Europe chief, Dov Zakheim, ex-Pentagon comptroller, and Patrick Cronin, Asia-Pacific Security expert. They dive into Trump's proposals to cut Pentagon waste while aiming for a $100 billion defense spending increase. The discussion touches on shifting U.S. military strategies, alliances in a multipolar world, and the impact of geopolitical tensions on global security. Highlights include fears over American credibility and historical parallels in current national security policies.

On today’s Strategy Series program, sponsored by General Atomic Aeronautical Systems, Dr. Richard Andres, a professor at the national defense university and the former adviser to the secretary of the Air Force and commander of US Cyber Command, joins Defense & Aerospace Report Editor Vago Muradian to discuss the report for the Mitchell Institute for Aerospace Studies he cowrote with former Air Force Chief of Staff Gen. Buzz Mosley, USAF Ret., and Mitchell’s Maj. Gen. Larry Stutzriem, USAF Ret.; why jointness has prioritized today’s readiness over strategic planning and the need to return more authority to the military services to accelerate innovation and program execution.

B-21, Sentinel, NGAD The US Air Force is modernizing almost every piece of hardware in its inventory. We get into details with the man who was deep into all those programs, former Air Force acquisition chief Andrew Hunter. Plus airpower headlines. All powered by GE!

Byron Callan, an analyst from Capital Alpha Partners, joins Chris Servello, co-host of Cavas Ships, to dissect defense budgets and industry trends. They delve into the Senate Armed Services Committee's proposed mark and the Trump administration's savvy messaging strategies. The duo explores potential impacts of new steel and aluminum tariffs on defense sectors and scrutinizes defense contractors’ financial health amid rising tensions. Additionally, they preview upcoming defense events, blending politics and military strategy with humor and insight.

On this week’s Defense & Aerospace Report Business Roundtable, sponsored by Bell, Dr. “Rocket” Ron Epstein of Bank of America Securities, Sash Tusa of the independent equity research firm Agency Partners, and Richard Aboulafia of the AeroDynamic advisory consultancy join host Vago Muradian to discuss Wall Street’s down week as investors worried about tariffs and inflation; Babcock, Bombardier, HII, Kongsberg, Palantir, Saab and Transdigm either report or prereport earnings; Boeing increased delivery of 737 Max series jetliners to 40 a month from 35 a month last year as Airbus delayed proposal on hydrogen powered aircraft; under pressure from investors Honeywell will break up into three parts as did GE, but investors punished the conglomerate’s stock; Triumph Group will be acquired by Warburg Pincus and Berkshire Partners in a $3 billion deal; commercial passenger and cargo traffic are both up 10 and 11 percent respectively year over year; the US Marine Corps issued its long-range aviation plan that includes increasing orders of carrier-capable C-model F-35 Lighting II stealth fighters.

On this week’s Defense & Aerospace Report Washington Roundtable, Dr. Patrick Cronin of the Hudson Institute think tank, Michael Herson of American Defense International, former Pentagon Europe chief Jim Townsend now with the Center for a New American Security, former Pentagon comptroller Dr. Dov Zakheim of the Center for Strategic and International Studies, and Cavas Ships co-host Chris Servello join Defense & Aerospace Report Editor Vago Muradian to discuss the latest on appropriations, appropriations, reconciliation and debt ceiling discussions on Capitol Hill as the prospect of a year-long continuing resolution and a government shutdown loom; the Senate moves to clear more of President Trump’s nominees including Tulsi Gabbard as director of national intelligence and Robert F. Kennedy Jr. as secretary of Health and Human Services; Elon Musk and his small team move at lightning speed to siphon unprecedented amounts of personal and financial data from agencies under the guise of improving government efficiency and move to gut the US Agency for International Development, offer retirement packages across government including to the CIA’s entire staff and fire some 40 percent of FBI agents; the implications of USAID’s demise as China, Russia and autocrats rejoice; whether distracted intelligence, law enforcement, allies or senior leaders will result in a future terror attack at home or incident abroad; analysis of Trump’s statement that the United States will take over Gaza and relocate more than 2 million Palestinians to Egypt and Jordan and redevelop it; and what to expect at the upcoming Munich Security Conference as America’s closest allies increasingly question their relationship with Washington.

Air Force Global Strike Commander General Thomas Bussiere brings us up to date on B-21, Sentinel, and maintaining deterrence in an increasingly multipolar world. Plus airpower headlines. All powered by GE!

Dr. Jim Lewis, the director of the Strategic Technologies Program at the Center for Strategic and International Studies, and Mark Montgomery, a retired US Navy rear admiral who is the senior director of the Center on Cyber and Technology Innovation at the Foundation for Defense of Democracies and Cyber Solarium 2.0 executive director, joins Defense & Aerospace Report Editor Vago Muradian to discuss the implications of the R1 Model by Chinese AI firm DeepSeek that sparked a market sell off on Wall Street; what makes it different from other AI models; how China used talent, technology and savvy thinking to compensate for technology restriction imposed on Beijing by Washington and its allies; why Chinese technology or military developments continue to surprise Western experts and what it says about US overconfidence; how better to control the flow of technology to China and whether there are lessons in the Cold War mechanisms like the Wassenaar Arrangement; whether President Trump’s $500 billion “Stargate” public private AI partnership is the right approach to better compete against China and advance American capabilities; the impact of Elon Musk’s drive to reorganize the US government at home and whether Trump’s muscular international rhetoric; and how the “grand bargain” Trump seeks with China could include handing Taiwan to Beijing.