"World War II Mode" Reappears! Pentagon Negotiates with U.S. Auto Giants to "Convert Production to Arms", Addressing Ammunition Inventory Shortages

The Trump administration is pushing U.S. automakers and other large industrial companies to expand weapons production to replenish ammunition stocks that have been rapidly depleted due to global geopolitical conflicts. This move has reminded the market of the wartime industrial production model of World War II.

According to media reports citing informed sources, senior U.S. Department of Defense officials have held preliminary extensive consultations with corporate executives including Mary Barra, CEO of General Motors, and Jim Farley, CEO of Ford Motor. The Pentagon hopes to leverage the workforce and factory capacity of these enterprises to support traditional defense companies and has explored the feasibility of a rapid shift to defense operations.

This policy shift could directly impact the business structure and investment logic of the U.S. industrial sector. With the Pentagon proposing a record-breaking $1.5 trillion budget request, non-traditional defense firms are expected to secure more high-value orders in ammunition and drone manufacturing, opening new revenue streams for major manufacturers.

Relevant negotiations began before the outbreak of the Iran conflict. Recently, U.S. Secretary of Defense Pete Hegseth explicitly called for placing the military manufacturing industry into a "wartime status" to ensure the U.S. military can maintain rapid supply of tactical hardware and ammunition amid multiple conflict pressures.

Removing Bidding Obstacles, Absorbing Diverse Capacity

In negotiations with executives of U.S. manufacturing companies, Defense Department officials framed increasing weapon output as a national security issue. According to media reports, as the Pentagon seeks to strengthen domestic manufacturing capabilities, officials not only asked what help companies could provide but also required executives to clearly identify obstacles in undertaking additional defense work, covering everything from contract requirements to resistance throughout the bidding process.

In addition to General Motors and Ford Motor, GE Aerospace and vehicle and machinery manufacturer Oshkosh also participated in negotiations with Defense Department officials. Logan Jones, Chief Growth Officer of Oshkosh's transportation division, stated that after Hegseth called on companies to increase production, the company began dialogues with the Pentagon in November, focusing on how to introduce relevant capacity in a manner matching the company's core competencies. Currently, although Oshkosh produces tactical troop transport vehicles for the U.S. military and its allies, the vast majority of its $10.5 billion in revenue still comes from non-defense sectors.

A Pentagon official stated that the Department of Defense is committed to utilizing all available commercial solutions and technologies to rapidly expand the defense industrial base, ensuring the military maintains decisive advantages.

Geopolitical Conflicts Intensify Ammunition Consumption

Since the outbreak of the Russia-Ukraine conflict in 2022, Washington and its NATO allies have transferred significant amounts of weaponry to Ukraine, leading to growing concerns among U.S. lawmakers and the Pentagon regarding domestic weapons manufacturing capabilities. The recent massive depletion of U.S. ammunition stocks caused by the Iran conflict further highlights the military's urgent need for more commercial partners.

To rapidly expand the supply scale of ammunition and tactical hardware such as missiles and anti-drone technology, the Pentagon is seeking funding. Its recently proposed $1.5 trillion budget request is not only the largest budget in the department's modern history but also explicitly calls for major investments in ammunition and drone manufacturing.

Converting domestic civilian manufacturing to military use has precedents. During World War II, Detroit automakers paused car production to mass-produce bombers, aircraft engines, and trucks. The Trump administration had previously issued similar appeals to U.S. automakers; at the onset of the pandemic, General Motors and Ford Motor collaborated with medical equipment manufacturers to produce tens of thousands of ventilators.

Currently, most military production is still carried out by a few traditional contractors. Although many large U.S. manufacturers outside the traditional defense sector hold Pentagon contracts, these contracts are typically limited in scope and amount, often confined to niche research or specific products.

However, auto giants are gradually deepening their participation in the defense sector. General Motors already owns a defense subsidiary responsible for producing light infantry squad vehicles based on the Chevrolet Colorado pickup truck. While this project and other related initiatives currently account for only a small portion of total revenue and capacity, they represent a growing revenue stream. The company is expected to become a strong contender for larger infantry squad vehicles intended to replace Humvees for the U.S. military. These new trucks will serve not only to transport troops but also as mobile power sources and command bases.