Weekly News Update: Nov 24, 2023
18 - 24 Nov 2023
Good morning,
Hopefully, by the time I hit “send” on this newsletter, you’ve recovered from your turkey comas (for those not in the United States, yesterday was our Thanksgiving holiday, typically celebrated by gorging on food including the large bird).
This week’s news was dominated by the shenanigans at OpenAI, where the board fired CEO Sam Altman triggering a massive employee revolt. Microsoft stepped in, offering Altman a job heading its AI efforts and later by pushing the board to reconsider its decision to shitcan Altman. In the end, several directors resigned from the board, and Altman returned to the company.
Iran has kicked out IAEA monitors (is it 1998 again, already?) and the White House fears the Islamic Republic may be planning on giving ballistic missiles to Russia to use against Ukraine.
Iran-backed terrorist groups and militias continue attacking the United States across the Middle East. Qatar successfully brokered a cease fire between Hamas and Israel, and the return of some Hamas-held hostages to Israel.
And, the U.S. Navy has successfully sunk something… just not the warships of an enemy. A Navy plane overshot a runway in Hawaii, and landed in the water.
Finally, it’s officially the holiday season. Not only will we hear Wham!’s Last Christmas way too many times, but nearly all VC investments will freeze until 2024. If you’re building for defense, keep those updates flowing to investors, but temper expectations of receiving a wire back.
Let’s dive in to these and other issues surrounding aerospace and defense technology.
Weekly News Round Up
Military
U.S. Defense modernization and innovation
Pentagon seeks to rapidly build up information warfare force (C4)
DoD says it will pick first tranche of Replicator drones by mid-December, but will only award to platforms that it’s already purchased (DDJ)
Navy delays MQ-25A Stingray timeline following IG warnings (BD)
Navy publishes its first cyber strategy (BD)
Upgraded F-35s fly with partial software as DOD hunts for fix (DN)
Europe, Russia, the Arctic, NATO, and the war in Ukraine
White House concerned Iran will give ballistic missiles to Russia for use in Ukraine (AP)
NATO considers permanent troop increase in Kosovo (RT)
A look into what counter-drone systems are used in Ukraine (C4)
Far right party wins big in Dutch elections (BBC)
Ruble bends to Putin’s will in nod to wartime election economics (BBG)
U.S. public support for Ukraine continues to wane (AP)
Germany pledges additional $1.4B for Ukraine military aid (AP)
The Netherlands pledges $2.2B in military aid for Ukraine (DN)
China, Korea, and Asia
House GOPers push to boost funding for security initiatives in Indo-Pacific (TH)
China attacks, injures Australian military diver using sonar (C4)
South Korea suspends parts of military deal with North, following North’s claim of spy satellite launch (S&S)
India, Australia look to boost defense ties (DN)
Middle East and Africa
Qatar has brokered a temporary cease fire and hostage exchange in Gaza (AP)
U.S. considers redesignating Houthis as terrorist group after ship seizure (AlJ)
U.S. fires back after ballistic missile attack on Iraq base (MT)
U.S. Treasury Department sanctions members affiliated with Iran-backed militia attacking U.S. bases (MT)
White House dispatches advisor to Israel in effort to prevent Israeli-Lebanon war (TH)
Israel’s $48B war bill leaves its fate with bond markets (BBG)
U.S. Defense Industry News
Boeing delivers final MH-139 test helicopter, ramps up production for procurement (ASF)
Boeing looks to the Middle East to shore up its defense business (DO)
Northrop expects clearance ‘very, very soon’ for delivery of next Integrated Air & Missile Battle Command Station to Poland, worth up to $4B (BD)
Northrop drops out of $7.5B U.K. satellite competition (TDP)
Rocket Lab to open spacecraft parts manufacturing plant in Maryland (C4)
RTX claims that its new radar replacing the Patriot system has defeated a cruise missile in testing (C4)
Ursa Major eyes DoD solid rocket motor market (BD)
The U.S. State Department has approved the following foreign military sales:
Foreign Defense Industry News
Airbus explores development of future tanker based on A330neo (BD)
Italy blocks French company Safran’s acquisition of A&D company Microtecnica, which builds components used in Eurofighter (DN)
U.A.E.’s EDGE Group does $2B in deals at Dubai Airshow (BD)
Brazil’s Mac Jee unveils exploding drone, with demo in coming months (C4)
U.K. Royal Navy flies and recovers Mojave UAS from aircraft carrier (BD)
Space
China’s global footprint for ground-based space operations is growing, and its worrying the U.S. military (WP)
North Korea claims to have launched a spy satellite, successfully (MT)
Despite calls to recycle the ISS for private industry, NASA will likely spend up to $1B to destroy it (SA)
U.S. Navy Research Lab finds hydrogen on the lunar surface (Navy)
Nuclear Power & Weapons
EU to put forward plan for $636B overhaul of power grids (BBG)
Iran’s nuclear enrichment advances as it stonewalls UN, IAEA reports (RT)
IAEA head says the barring of nuclear inspectors by Iran is a ‘serious blow’ to monitoring (AP)
AI, Energy, Robotics, and other Tech
New, bipartisan legislation seeks to accelerate Five Eyes A.I. development (DS)
As A.I.-controlled weapons become reality, nations debate limits (NYT)
Pentagon A.I. boss seeks ‘justified confidence’ to take tech into battle (C4)
DARPA wants an A.I.-powered ‘Autonomous Scientist’ to help researchers (DO)
OpenAI’s board fired its CEO, Sam Altman; employees revolted en mass; and now Altman has returned to the helm amid a shake-up to the board (RT)
OpenAI rivals move to exploit leadership turmoil (WSJ)
Before his short term ouster, OpenAI’s Altman was raising billions for a new computer chip venture (BI)
Nvidia delays launch of new China-focused AI chip (RT)
Amazon launches free AI classes in bid to win talent arms race (WSJ)
A&D-Focused Finance
Czech gunmaker Colt CZ Group made a cash-and-stock merger offer to Vista Outdoor valuing the sporting and outdoor goods group at ~$1.7B (RT)
Scandinavian airline SAS received US bankruptcy court approval for a $1.3B investment agreement with a consortium of Castlelake, Air France-KLM, Lind Invest and the Danish state (RT)
Texray, a radiation protection solutions startup, raised a $45M round led by Industrifonden (FN)
Italy blocked French group Safran’s planned $1.8B purchase of the flight control systems arm of Collins Aerospace due to the risk of disruption for its armed forces (RT)
Norway's competition watchdog may block Norwegian Air's bid for domestic rival Wideroe, as it may cause fewer and more expensive flights (RT)
Sustainable aviation fuel startup SkyNRG raised a $190.9M round led by Macquarie Asset Management (EU)
X-Bow Systems, a low-cost hypersonics provider, raised $64M in funding from Lockheed Martin Ventures (PRN)
AireXpert, a Buffalo, NY-based provider of aerospace and aviation collaboration and automation solutions, raised $3M in funding led by Reformation Partners (FN)
Important Reads
Retired Marine Colonel Gary Anderson explains how directed energy weapons can counter the use of human shields.
Air Force Intelligence officer Chance Smith argues how we need to add precision targeting and economy of force to the Replicator Initiative’s attritable mass.
The Wall Street Journal published a behind-the-scenes look at the weekend’s OpenAI situation, pulling from interviews from more than a dozen insiders.
Ben Thompson explained how no matter what happens with OpenAI, Microsoft is the big winner.
Lighter Side
Keep building!
Andrew