Poor return on investment
The 2004 US Defence Budget: Approaching half a trillion dollars
The past four years have been a boom time for defense contractors. Companies that produce bullets and repair equipment enjoyed an increase in revenue because of the wars in Iraq and Afghanistan. At the same time, the Pentagon continued to spend billions of dollars developing large weapons. The Pentagon's procurement and research and development budgets, where major weapon systems get most of their funding, increased to $148 billion in fiscal 2005 from $103 billion in 2001, according to the fiscal 2006 budget proposal.
Revenue at Armor Holdings Inc., which puts armor on military vehicles, has increased from $197 million in 2001 to $979 million in 2004. Lockheed's revenue jumped from $23 billion in 2001 to $35 billion last year and is expected to reach $37 billion this year.Some defense contractors have prepared for a slowdown in Pentagon spending for some time by diversifying into nontraditional services like information technology. Lockheed, for example, has expressed interest in buying the government business of Computer Sciences Corp., which would extend its lead in the federal information technology market.
"The expectation was that the budget would level out,"
For more on government information technolgy markets see ' Golden Shield '
The past four years have been a boom time for defense contractors. Companies that produce bullets and repair equipment enjoyed an increase in revenue because of the wars in Iraq and Afghanistan. At the same time, the Pentagon continued to spend billions of dollars developing large weapons. The Pentagon's procurement and research and development budgets, where major weapon systems get most of their funding, increased to $148 billion in fiscal 2005 from $103 billion in 2001, according to the fiscal 2006 budget proposal.
Revenue at Armor Holdings Inc., which puts armor on military vehicles, has increased from $197 million in 2001 to $979 million in 2004. Lockheed's revenue jumped from $23 billion in 2001 to $35 billion last year and is expected to reach $37 billion this year.Some defense contractors have prepared for a slowdown in Pentagon spending for some time by diversifying into nontraditional services like information technology. Lockheed, for example, has expressed interest in buying the government business of Computer Sciences Corp., which would extend its lead in the federal information technology market.
"The expectation was that the budget would level out,"
For more on government information technolgy markets see ' Golden Shield '
posted by professor rat at 12:24 PM
<< Home