Pandemic Revealed Supply Chain Vulnerability, Pentagon Official Says
(Source: US Department of Defense; issued July 08, 2020)
One of the biggest lessons learned during the COVID-19 pandemic is that the supply chain is vulnerable to offshore suppliers, particularly adversaries such as China, a senior Pentagon official said.

Ellen M. Lord, undersecretary of defense for acquisition and sustainment, spoke on defense spending and capabilities after COVID-19 at the Brookings Institution's European Union Defense Washington Forum today, participating in the discussion via video.

The United States and its allies and partners now have a better understanding of the fragility of the supply chain, Lord said. Critical military systems depend on rare-earth mineral processing and microelectronics made in China or fabricated and packaged there.

In addition to the problems uncovered in the manufacturing of military components, adversarial capital is coming in that involves intellectual property theft, as well as merger and acquisition activity that involves takeovers of critical companies in the U.S. and its allied and partner nations, she said.

"We need to make sure we re-shore as much as possible," she said — bringing as much of the defense industrial base back to U.S. shores as is feasible while still relying on allies and partners for their contributions. Canadian, Mexican and European partners produce military hardware for the United States, she noted.

When the Defense Department goes out for bids for a system, the DOD officials like to have as many competitive bids as possible — both to bring down cost and to have more options, Lord said. If just two companies are bidding, she said, she'd prefer that one is domestic.

One of the most important aspects of the U.S. industrial base and the trans-Atlantic industrial base in Europe is frequent and transparent communications, Lord said. She noted that she's in constant communication with her European counterparts to bounce ideas off of them on reform and modernization, as well as issues of interoperability and countering malign Chinese influence.

"When we go to war, we go together," Lord said. "We need to be interoperable. Unless we're working on these systems together, we will not be interoperable."

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