PHOENIX (AZFamily) — The war in Iran has driven up gas prices and fueled inflation, but it has also benefited defense contractors, including many based in Arizona, where the aerospace and defense sector employs 62,000 people.
‘Poor man’s cruise missile’
The weapons proving most effective on the battlefield are not produced by industry giants like Raytheon or General Dynamics. Instead, they are low-tech, inexpensive drones.
In March, President Donald Trump announced that the United States had all but wiped out Iranian defenses.
“We continue to target Iran’s drone and missile capabilities. Their drones are way down,” Trump said.
More than seven months later, those drones have played a role in damaging U.S. bases, killing and injuring American service members, and disrupting the oil industry across the Middle East.
Mike Canada operated drones in Iraq and Afghanistan and now leads the drone program at Embry-Riddle Aeronautical University.
“You know I don’t think people could have predicted what is happening now,” Canada said.
Canada described the systems as a “poor man’s cruise missile.”
“You don’t need to put a lot of explosives on something to make it a poor man’s cruise missile,” Canada said.
Missile stockpiles depleted
U.S. forces have fired missiles worth billions of dollars at Iran while expending billions more on interceptors to shield ships and military installations.
That demand has generated significant revenue for established contractors. Raytheon, which manufactures munitions in Tucson, Arizona, announced a contract worth nearly $23 billion to build new Tomahawk cruise missiles. Other defense firms are also profiting.
Still, these costly, advanced weapons have shown clear limitations.
Daniel Rothenberg is the co-director of the Future Security Initiative at Arizona State University, where he studies armed conflict.
“It’s a little too early to say, but we’ve certainly seen that even that incredible use of extraordinary weaponry hasn’t made it… has allowed the Iranians to respond with relatively low-cost drones, and to target both U.S. bases with some pretty significant implications, and also all kinds of other, you know, sites within the region,” Rothenberg said.
Rothenberg said he does not believe the major defense companies are going away, but he expects them to adapt, potentially by acquiring smaller drone manufacturers.
“That may well happen with General Dynamics, Raytheon, but there are a lot of small contractors out there producing drones. There’s even some in Arizona,” Rothenberg said.
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