Weekly News Update: Dec 1, 2023
25 Nov - 1 Dec 2023
Good morning,
December has arrived with a roar.
As slow as Thanksgiving made last week’s news, this week has been packed.
We’ve lost two icons: controversial Former Secretary of State Henry Kissinger and investor, businessman, and philanthropist Charlie Munger. I suspect one will be mourned more than the other, although both have left indelible marks on our country.
After a week-long cease fire and hostage exchanges with Hamas, Israel has relaunched its offensive in Gaza. Iran and Iranian-backed groups throughout the Middle East continue provocations towards the United States and allies, threatening escalation, apparently oblivious to the acronym FAFO and what it means. Undoubtedly, U.S. Army General Erik Kurilla and the service members of U.S. Central Command standby to show them.
The Russo-Ukrainian War shows no real signs of slowing down, even as winter sets in. Ukraine looks to shore up support from partners in the West, and demonstrated its ability to reach deep into Russia’s interior, destroying a freight train in Siberia that reportedly carried military supplies. For its part, Russia appears to be flailing with the Deputy Foreign Minister challenging the United States to a new ‘arms race.’
The DefenseTech sector remains hot with Ursa Major, Second Front Systems, and ZeroAvia all announcing significant fundraises this week.
Let’s dive in to these and other issues surrounding aerospace and defense technology. I strongly suggest reading this one in your browser as it’s a long one.
Weekly News Round Up
Military
U.S. Defense modernization and innovation
Defense Innovation Unit to host Replicator technology summit (C4)
Air Force increasingly reliant on synthetic training, as adversaries advance (BD)
The Army seeks to glean lessons about high- and low-tech fighting from Ukraine, Israel (BD)
Army acquisition chief: as industry innovation races ahead, service struggles with resources, training (BD)
Army releases first doctrinal publication focused on information (DS)
Marine Corps looks at ocean glider for rapid resupply to fight China (MCT)
Navy explores non-kinetic effects for victory in new cyber strategy (DO)
Europe, Russia, the Arctic, NATO, and the war in Ukraine
Russian Deputy Foreign Minister challenges U.S. to another arms race (Pol)
Russian army corps commander dies after stepping on landmine, that other Russian’s may have laid (NYP)
Intercepted calls show increasing number of Russian soldiers want out of war (AP)
Ukrainian agents destroy a military supply train in Russia’s far east (BBG)
NATO chief urges allies to ‘stay the course’ in supporting Ukraine (AlJ)
Reagan National Defense Survey finds much higher support for Ukraine than other polls, at 59% (DN)
Ukraine’s spy chief’s wife poisoned with heavy metals (AP)
Concerns grow over E.U.’s ability to delivery a million rounds, promised to Ukraine (WSJ)
Latvian Foreign Minister Karins makes bid to replace Stoltenberg at NATO (AP)
China, Korea, and Asia
Congressional China commission calls for stronger tech export controls (RC)
U.S. Air Force Osprey crashes off southern Japan, at least 1 dead (MT)
China coast guard warns off Japanese ships in disputed waters (RT)
China calls U.S. a ‘security risk creator’ as ship sales near Paracel Islands (S&S)
Myanmar military loses ground after two weeks of fighting militias (AP)
Middle East and Africa
After week-long truce, Israel resumes its offensive in Gaza (AP)
U.S. Congress moves to permanently freeze $6B in Iranian funds (TH)
U.S. Navy seizes attackers who held Israel-linked tanker (AP)
U.S.S. Carney shoots down drone launched from Yemen (NT)
Iranian drone takes ‘unsafe action’ near U.S. aircraft carrier (NT)
U.S. Air Force begins delivering humanitarian aid to Gaza (MT)
French warship docks in Egypt, could treat Gaza children (RT)
U.S. Senate considers conditions on Israeli aid (DN)
Chart: U.S. deliveries of weapons to Israel since 1950 (Ax)
Justifying Section 702 spy tools, officials point to success in disrupting Iran weapons programs (Pol)
Iranian-backed group promises to expand conflict if if U.S. airstrikes continue (MT)
Iran-backed militant groups from Hamas to Hezbollah now prefer fast-growing crypto network Tron over Bitcoin (RT)
U.S. Defense Industry News
White House circulates map showing states that benefit from Ukraine aid (Pol)
Congress accelerates fight against defense contractors’ ‘price gouging’ (RC)
DIU solicits new round of proposals for space network project (SN)
Anduril reveals an anti-air loitering munition with return-to-base capabilities (C4)
Air Force awards Boeing $2.3B contract for 15 more KC-46s (DN)
Canada to buy Boeing-made P-8A Poseidon's in $5.9B dial (DN)
Defense Information Systems Agency adds AT&T, Honeywell, Iridium, and Lynk Global to Proliferated LEO Satellite Services Contract worth up to $900M (SN)
Arctic chill freezes Canada’s $3.2B plan to buy Reaper drones from General Atomics (C4)
General Dynamics: AI can shore up federal cybersecurity overrun by data (C4)
Kratos wins 8-year extension worth $579M to maintain military comms satellite ground stations (SN)
Leidos to develop new Marine Corps air defense radars for $32 million (TDP)
Lockheed, Northrop win small contracts from the Army to advance spying and jamming payloads for drones (C4)
Lockheed’s precision strike missile aces Army test, eyes 250-mile range (RCD)
Millennium Space to build a missile-sensor layer in MEO (SN)
Oshkosh wins $342M Army contract to produce equipment trailers (WAGB)
Pentagon expects to award sole-source contracts to Pratt & Whitney for upgraded F-35 engines (DN)
Qarbon Aerospace wins $3.7M from Industrial Base Analysis and Sustainment Program to design and manufacture thermoplastic composite structures (DOD)
DARPA gives RTX $15M to add diamonds to radars (C4)
Air Force Security Forces train on Skydio X2D drone, want to see it in Replicator Initiative (ASF)
South Star wins $3.2M for coated, spheronized, purified graphite (DOD)
Foreign Defense Industry News
Belgium to join Europe’s FCAS next-gen fighter program in June 2025 (BD)
Software snags delay German Puma fighting vehicle upgrades (DN)
Germany to supply Ukraine with IRIS-T missiles in $1.4B package (C4)
Germany, Israel finalize Arrow 3 air defense deal, aim for delivery in late 2025 (BD)
Iran finalizes deal to buy Russian Su-35 fighter jets, Mi-28 attack helicopters (RT)
Netherlands wants to join EU’s Joint Armaments Program (C4)
Romania plans to spend $2B on short-range air defense (DN)
Saudi Arabia Military Industries partners with Brazil’s Embraer on defense cooperation, C-390 (BD)
Spain signs $500M+ deal for SIRTAP drones from Airbus (BD)
Space
Despite congressional and industry opposition, the White House wants more regulation on space activities such as on-orbit refueling, in-space transport (BD)
Space Force to start production on new missile warning satellites for medium-earth orbit (ASF)
North Korea pledges more spy satellite launches (AP)
South Korea claims North had Russian help to get spy satellite in space (C4)
Space Development Agency demonstrates Link 16 satellite connectivity (C4)
NASA warns against space tech budget cuts (SN)
House Science Committee advances commercial space bill (SN)
Ireland hopes to launch its first satellite into space, tonight (RTE)
Space Force postpones launch of secretive X-37B space plane until Dec 10 (Sp)
Nuclear Power & Weapons
Congress is stripping important nuclear legislation from the NDAA (AxP)
Japanese inaugurate world’s largest experimental nuclear fusion reactor (Ph)
‘Gay furry hackers’ breach U.S. nuclear research facility, demand Idaho National Lab invest in creating real-life ‘catgirls’ (NR)
U.N. atomic chief backs nuclear power at COP28 (AP)
IAEA announces a dozen countries to be equipped with nuclear power (RT)
AI, Energy, Robotics, and other Tech
DARPA eyes establishing next-generation semiconductor manufacturing hub (C4)
International military leaders rethink leadership models as AI advances (C4)
The military is growing more pro-AI, even as society resists (DO)
Pentagon’s Replicator Initiative may speed decisions on lethal autonomy (C4)
NATO to update AI strategy (C4)
Sam Altman returns to OpenAI with more influence than ever before (BBG)
OpenAI rival Hugging Face says it’s seeing more client interest after Sam Altman fiasco (CNBC)
TikTok CEO challenged by tech leaders on pro-Palestine posts (BBG)
Microsoft secures non-voting board seat at OpenAI (CNBC)
Amazon announces Q, an AI chatbot for businesses (CNBC)
A&D-Focused Finance
Rocket propulsion startup Ursa Major raised a $138M Series D-1 led by Eclipse and Explorer 1 Fund (PRN)
Public benefit software company Second Front Systems raised a $40M Series B led by NEA (PRN)
ZeroAvia, a developer of zero-emission aviation engines, raised a $116M Series C led by Airbus, Barclays Sustainable Impact Capital, and NEOM Investment Fund (PRN)
L3Harris will sell off its Commercial Aviation Solutions unit to private equity firm TJC for $800M (DN)
KKR is working on a bid for Telecom Italia's submarine cable unit Sparkle; TIM and KKR discussed a valuation of around $817M-871M (RT)
Electricite de France is selling the first green bond in Europe that can be used to finance nuclear energy projects and is seeking to raise at least $548M (BBG)
Spirit Airlines offers buyouts to salaried employees to cut costs (CNBC)
PE fund Ardian and Saudi Arabia's Public Investment Fund will acquire 15% and 10% stakes in Britain's busiest airport, Heathrow, from infrastructure giant Ferrovial for a total of $3B (RT)
Eco-friendly lithium extraction startup ADIONICS raised a $27M Series B from Bpifrance, Céleste Management, and others (PRN)
Important Reads
Economic commentator Noah Smith brings the conversation on defense industrial policy to the mainstream discussing how people are realizing that the ‘Arsenal of Democracy’ is gone.
Peter Singer explains why we don’t need systems that penetrate Chinese anti-access/area denial capabilities. Instead, we need our own A2AD systems to prevent China from invading other countries.
While he was one of the world’s best investors, Charlie Munger was best known for his wisdom over the years. Here’s a compilation of some of his wisest quotes over the years.
Lighter Side
Keep building!
Andrew