NATO - Industry Forum

NATO - Industry Forum
November 09, 2016

Thank you, Catherine.

Secretary-General Stoltenberg, General Mercier and NATO staff – thank you for organizing this important discussion.

The question before us this afternoon is critical to the future: “How can aerospace and defense companies partner with NATO and with our peers in the industry to help maintain the Alliance’s military advantage?”

We explore this question against the backdrop of well-known and highly complex geopolitical and economic challenges.

We have seen increasingly bold territorial claims from some nations and asymmetric threats that have created political turmoil and far-reaching humanitarian crises.

In addition, because of slow economic growth worldwide, members of the Alliance are also facing significant budgetary pressures.

As we consider these challenges and how to respond, it is valuable to recall how cooperative efforts have helped the Alliance in the past to preserve security from Central Europe to the Atlantic, from the Mediterranean to Afghanistan and beyond.

Simply put, NATO is just as essential as it was 67 years ago when the North Atlantic Treaty was first signed.

The strategic partnerships and deep relationships flowing from more than six decades of cooperation provide a strong foundation for taking on our 21st century challenges together.

This afternoon, I’d like to set the stage for our discussion by briefly highlighting three actions that would help the members of NATO and their industry partners maintain the Alliance’s technological edge.

First, I will talk about the need for consistent and sustained investment to support operational readiness and to promote research and development.

Then, I will discuss the benefits of a collaborative approach and the advantages of interoperable technologies.

And finally, I will close with our shared need to build a pipeline of science, technology, engineering and math talent so that we can continue to encourage innovation.

Our cooperative efforts must begin by properly framing what is the most effective way to respond to emerging threats.

We must recognize and communicate that maintaining a strong defense-industrial base is an investment in maintaining peace – an investment that has the potential to promote broader innovation, economic growth and fruitful diplomatic discussions.

A NATO Alliance that is fully equipped with advanced technology is more flexible and better prepared to confront a wide range of modern threats.

However, to maintain operational readiness and create incentives for industry to pursue research and development, defense spending must be consistent and sustained.

The pledge by NATO members to invest two percent of their GDP on defense within a decade will go a long way toward helping the Alliance and its industry partners engage in the long-term investments and R&D that yield the most promising innovations.

Another area where we can take action that will help us simultaneously meet both geopolitical and budgetary challenges is to expand interoperability.

We must ensure that our nations’ military technologies have the capability to work together.

This increases information sharing and enhances our partnerships.

In an Alliance consisting of 28 independent member countries, this approach can also lead to greater affordability, flexibility and increased long-term effectiveness.

The F-35 Lightning II fighter aircraft is a prime example of an interoperable platform that is providing significant advantages to NATO forces.

In fact, eight of the nine F-35 partner nations are members of NATO.

And the Final Assembly and Check Out facility in Italy is already delivering jets.

The benefits of the F-35 program go beyond the fifth-generation fighter’s performance in the air.

The program has a deep and broad supply chain that draws from and helps support small and medium-sized enterprises across Europe and around the world.

With the innovation and expertise of these small and medium-sized enterprises, the F-35 program strengthens shared defense capabilities, spurs economic growth and creates well-paying jobs.

The result is both technological advantage and more robust national economies.

Another example of the benefits of a cooperative approach to common defense is ballistic missile defense.

In Europe, ballistic missile defense has created opportunities for NATO’s industry partners to work together to develop open architecture systems.

This approach will allow assets from many nations to be integrated into regional defense systems.

One of the best ways to encourage more interoperability and collaboration is to reform NATO’s procurement process.

By putting an emphasis on joint program development within the context of stable investment, industry partners can plan farther in advance, create effective long-term partnerships and help achieve economies of scale.

This could lead to more accelerated timelines and increased affordability as well as enable the Alliance to keep up with evolving threats over the long term.

Technological leadership will be key to shaping the future.

The Alliance’s technological advantages are ultimately derived from its highly skilled workers in the aerospace and defense industry.

However, there is strong evidence from around the world that technology companies are facing a shortage of workers who have the right skills to fill essential jobs.

Which brings me to my third action: we must ensure our education systems are equipping students with the science, technology, engineering and math skills needed to develop solutions for NATO’s most pressing security challenges.

Encouraging students to pursue STEM disciplines will require outreach, engagement and support from government, industry and respected social institutions.

In summary, maintaining NATO’s technological leadership and capabilities will be critical to the future of the Alliance and to human progress.

At Lockheed Martin, we believe that by taking action in these three areas – sustained investment, increased interoperability and long-term talent development – government and industry can help NATO protect our shared vision and values for many years to come.

Thank you.

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