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Contents

SIPRI Yearbook 2010

SIPRI Yearbook 2010

6. Arms production

Chapter:
6. Arms production
Source:
SIPRI Yearbook 2010
Author(s):
Susan T. Jackson

Susan T. Jackson

I. Introduction

In 2008 the world’s 100 largest arms-producing companies—the SIPRI Top 100—maintained the upward trend in their arms sales, which reached $385 billion.1 While companies headquartered in the United States again dominated the Top 100, for the first time a non-US headquartered company registered the highest level of arms sales—BAE Systems of the United Kingdom.2 The conflicts in Afghanistan and Iraq continued to heavily influence sales of military equipment such as armoured vehicles, unmanned aerial vehicles (UAVs) and helicopters in 2008. At the same time, sales registered by military services companies continued to grow, as did the arms sales of Russian companies to both domestic and foreign customers.

Following peak levels earlier in the decade, the number of large transnational mergers and acquisitions fell again in 2009. There was, however, more consolidation in the Israeli, Russian and US industries as well as a continued pattern of arms-producing companies diversifying into the security industry. Even though more than a year has passed since the onset of the global financial crisis and economic recession, many arms-producing companies continued to increase arms sales in 2009.

Section II of this chapter presents and analyses the main trends in the SIPRI Top 100 arms-producing companies for 2008. Section III covers major merger and acquisition activity amongarms-producing companies in 2009. Drawing on a sample of company financial reports from 2009 and government strategies, section IV discusses the impact of the financial crisis and the ensuing economic downturn on the arms industry. Section V concludes the chapter. Appendix 6A lists the SIPRI Top 100 arms-producing companies in 2008, and appendix 6B lists the major acquisitions within Organization for Economic Co-operation and Development (OECD) arms industries in 2009.

Table 6.1. Trends in arms sales of companies in the SIPRI Top 100 arms producing companies, 2002–2008

2002

2003

2004

2005

2006

2007

2008

2002–2008

Arms sales at current prices and exchange rates

Total ($ b.)

195

235

274

289

312

346

385

Change (%)

20

17

5

8

11

11

97

Arms sales at constant (2008) prices and exchange rates

Total ($ b.)

263

295

324

331

346

362

385

Change (%)

12

10

2

5

5

6

46

Note: The figures in this table refer to the companies in the SIPRI Top 100 in each year, which means that they refer to a different set of companies each year, as ranked from a consistent set of data. E.g. the figures shown above for 2007 differ from those in table 6.2.

Source: Appendix 6A; and the SIPRI Arms Industry Database.

Notes:

(1) The delay in publication of the accounts of many of the companies discussed here means that 2008 is the most recent year for which arms sales figures are available. Discussion of merger and acquisition activity in this chapter refers to developments during 2009.

(2) The internationalization of the arms-producing industry means that companies based in one country often belong to a company or group with headquarters in another country. In this chapter, a country designation refers to the location of a company’s headquarters.

Citation (MLA):
Jackson, Susan T.. "6. Arms production." SIPRI Yearbook. SIPRI. Oxford: Oxford University Press. 2016. Web. 24 Feb. 2017. <http://www.sipriyearbook.org/view/9780199581122/sipri-9780199581122-chapter-7.xml>.
Citation (APA):
Jackson, S. (2016). 6. Arms production. In SIPRI, SIPRI Yearbook 2010: Armaments, Disarmament and International Security. Oxford: Oxford University Press. Retrieved 24 Feb. 2017, from http://www.sipriyearbook.org/view/9780199581122/sipri-9780199581122-chapter-7.xml
Citation (Chicago):
Jackson, Susan T.. "6. Arms production." In SIPRI Yearbook 2010: Armaments, Disarmament and International Security, SIPRI. (Oxford: Oxford University Press, 2016). Retrieved 24 Feb. 2017, from http://www.sipriyearbook.org/view/9780199581122/sipri-9780199581122-chapter-7.xml