War Secretary Pete Hegseth is set to address a number of top defense companies on Friday to outline a potential overhaul to the procurement process amid persistent delays and waste in contract deliveries.
The meeting is intended to outline a sweeping set of acquisition reforms to top-level executives at America’s top industry titans, such as Lockheed Martin and Raytheon Technologies, among many others. The industry titans have long suffered from delays to delivering on contracts to the Pentagon, often to the tune of hundreds of billions of taxpayer dollars.
“The core principle of this transformation is simple: place accountable decision makers as close as possible to program execution, eliminate non value added layers of bureaucracy, and prioritize flexible trades and timely delivery at the speed of relevance,” Hegseth said in a memo announcing the meeting.
One flagship example remains Lockheed Martin’s contract for the F-35 multi-role fighter, which is over budget by $165 billion and a decade late on deliveries. The Air Force also slashed its order for the fighter jets from 48 units to only 24 units in their procurement request for fiscal year 2026.
Boeing’s KC-46 Pegasus aerial-refueling tanker was also delayed over eight years to the tune of billions of dollars of overrun cost. Additionally, the company’s drone refueling craft, the MQ-25 Stingray, was delayed from 2024 to 2027.
The Government Accountability Office found in 2025 that Boeing spent nearly a billion dollars over eight years on the Orca Extra Large Unmanned Undersea Vehicle despite the program never making it to full production.
A Pentagon review in 2024 found that the Northrop Grumman’s LGM‑35A Sentinel ICBM overran on cost by twice the amount anticipated. Per unit cost overrun also more than doubled.
The General Dynamics Virginia-class submarine program was expected to overrun its budget by $17 billion by 2030, a House lawmaker told Business Insider in 2024.
Reports suggest that Hegseth’s new policy may introduce direct penalties to contractors who are behind on their orders. Additionally, the memo calls for the establishment of “scorecards” to measure the performance of acquisition portfolios.
The Pentagon did not immediately respond to the Daily Caller News Foundation’s request for comment.
(Featured Image Media Credit: Screen Capture/CSPAN)
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