The US-UK arms trade

Last updated 25 May 2021

UK governments often like to boast of the UK’s “special relationship” with the US. How central this relationship really is to the US is debatable, but one area where cooperation between the two countries is particularly close is in the arms industry and trade. Each is a significant supplier of arms to the other, they are engaged in major collaborative arms programmes, most notably the F-35 stealth fighter aircraft, and the major UK arms companies have large subsidiaries in the US, and vice versa.

UK arms sales to the US

While the US sources most of its arms from US-based arms companies, it is also a significant importer, the 13th biggest worldwide between 2016-20, according to SIPRI data for major conventional weapons transfers. The UK was the largest supplier of such weapons, accounting for 22% of US imports.

However, as a large proportion of UK arms trade in general consists of subsystems, components, and services, not counted by SIPRI, this only tells part of the story. Between 2015 and 2019, the UK sold £7.2 billion worth of arms to the US and Canada combined, of which the vast majority will be to the US. This makes the US the UK’s second largest arms customer after Saudi Arabia.

These figures are based on the value of arms contracts won by UK companies, collected by UK Defence and Security Exports. (Figures for individual countries are not made public). Over the same period, the UK issued standard (Single Individual) export licences for arms sales to the US worth only £2.8 billion (and, for comparison, just £112 million to Canada), but the majority of UK arms sales to the US are made using the secretive open licencing system.

The UK-US Defence Cooperation Treaty in particular means that the process of gaining permission to sell arms between the two is greatly simplified and eased. In the UK, this takes the form of an Open General Export Licence (OGEL), for which companies can register, and which then, subject to certain conditions and record-keeping, allows them to sell a very wide range of military equipment, technology, and services to the US without the need for specific permits for each sale. Once a company is registered for this OGEL, this permission lasts indefinitely.

Bar chart showing UK arms sales to North America 2013-19

Anti-protest equipment sales to the US

One particularly concerning aspect of UK arms sales to the US is a wide range of anti-protest equipment, including tear gas, riot shields, batons, and other equipment of the type used by police to suppress protests by Black Lives Matter supporters and other protest movements. UK-supplied riot shields have been documented being used against Black Lives Matter protesters.

Black Lives Matter protest in Seattle, May 2020

Kelly Kine, CC BY-NC-ND 2.0

Stop arming US State Violence

The UK government has licensed anti-protest weapons of the type that have been used in violent attacks on protesters, journalists and others in the United States. Please ask your MP to support the cancellation of these licences.

FAQ – UK export approvals

Following the murder of George Floyd, protests in the US against racism and police violence have been met with further state violence. The response in the UK has included anger at the potential role of the UK in supplying equipment that could be used to suppress protests. Here we try to answer some of the

US arms sales to the UK

From Fiscal Years 2015 to 2019 (i.e. October 2014 – September 2019), the US made deals worth $7.9 billion (£5.9 billion) for Foreign Military Sales to the UK (sales from government-to-government agreements). A further $630 million (£469m) was delivered under Direct Commercial Sales licences between 2015-19.

The biggest single deal in recent years is the 2006 agreement for the UK to purchase at least 48 and potentially as many as 138 F-35B Lightening II stealth fighter jets. The cost of the first 48, to be procured up to 2026, is currently expected to be £8.6 billion, including spares, support, training, and investment in infrastructure at UK air bases. The “fly-away” cost for each aircraft itself has so far varied between $122 million and $161 million per plane.

Other major purchases include:

A 2016 deal for £3 billion for 9 P-8A Poseidon anti-submarine warfare aircraft;
A 2019 deal worth £1.5 billion for 5 Boeing-737 Airborne Early Warning and Control aircraft
A 2016 deal for 50 Apache combat helicopters costing £1.6 billion

(Information from SIPRI and the MOD’s Defence Equipment Plan.)

The UK has also bought a large number of bombs and missiles from the US, including the Paveway IV guided bombs produced in the UK using US technology, which the UK also sells to Saudi Arabia.

Nuclear weapons

The UK is also highly dependent on the US for its “independent” nuclear deterrent. While the Vanguard nuclear submarines that carry the UK’s Trident nuclear missiles are produced in the UK (as will be the Dreadnought submarines that will replace them, at a lifetime cost of over £200 billion), the missiles themselves are US-produced, and in fact are leased by the UK from a pool of missiles maintained by the US. The new W93 warhead being designed for the UK’s nuclear weapons is also closely linked to a parallel US project and depends on US cooperation. This open arrangement of sharing of nuclear weapons equipment and technology is unique among the nuclear weapons powers.

The UK role in the F-35

The UK is the only “Level 1 industrial partner” for the F-35, with around 15% of the value of each plane developed or produced in the UK, mostly by BAE Systems , who hold a 13-15% workshare. As well as supplying the US, the UK, Japan, and other European air forces, the F-35 has been sold to Israel, who have so far made three orders totalling 50 planes; the first two orders for 33 planes cost $5.5 billion. The US has also recently agreed a sale of 50 F-35s to the UAE for $10.4 billion. Despite a review of Trump-era arms sales, President Biden decided in March 2021 that this sale would go ahead. As the UK produces 15% of the value of each F-35 produced, this represents massive indirect arms sales by the UK to these countries.

UK sales of components and equipment for the F-35 are covered by a specific OGEL, which allows registered companies to conduct unlimited exports of F-35-related material to the US and most other F-35 customers, without specific licencing. This means that most F-35-related exports are not visible in the government’s regular export-licencing data.

Despite the vast expense of the F-35 programme, with a projected lifetime cost of $1.7 trillion for the US, the F-35 has been widely criticized for its poor performance, to the point where many analysts have described it as having “failed“. It has nonetheless been an enormous money spinner, primarily for Lockheed Martin and the US arms industry, but also for the UK arms industry, especially BAE Systems.

Key statistics

£7.2 billion

UK arms sales to US and Canada 2015-19

£6.4 billion

US arms sales to UK 2015-19

Intertwined industries

The US and UK arms industries are deeply interconnected: by trade between the two countries, by joint programmes like the F-35, and by corporate ownership, with major UK arms companies having large subsidiaries in the US, and (to a lesser degree) vice versa.

UK arms companies with subsidiaries in the US

BAE Systems have almost as much of their activities in the US as in the UK, especially in their military electronics systems, land systems, and cyber warfare and security businesses, which are controlled by a US subsidiary, BAE Systems Inc. In 2020, 45% of their sales were to the US (most of which will have come from their US-based subsidiaries), while 31,900 out of 89,600 of their employees were based in the US (36%).

Rolls Royce have 6,200 out of 48,500 of their employees in the US (12.8%).

QinetiQ made 11.2% of their revenue in 2019-20 (£120 million) from their US businesses, which specialize in robotics, autonomous systems, and sensing solutions.

Meggitt produce a variety of subsystems for military and civil aircraft, land and naval systems, and a variety of other military and civil technology. Despite being founded and headquartered in the UK, a majority of their employees in 2019-20 were in North America, 4,871 out of 9,280, or 52%. In particular, 74% of their military revenues in 2019-20 were from US customers.

Cobham produce military electronics systems, communication and connectivity systems, and military aerospace mission systems. Their Advanced Electronics Systems and much of their Mission Systems business is based in the US. In total, 52% of their employees in 2018 were based in the US, despite the company being headquartered in the UK. Cobham were taken over by Advent International, a US private equity company, in January 2020.

US arms companies with subsidiaries in the UK

Raytheon Technologies, one of the world’s largest arms companies, has a UK subsidiary, Raytheon UK Ltd., with 9 locations in the UK, employing 1,700 people in 2017. Raytheon UK’s business includes airborne intelligence, surveillance and reconnaissance, cyber and intelligence, sensors, missiles and bombs, and military training systems. The Raytheon factory in Glenrothes, Scotland, produces Paveway IV bombs which are both used by the UK military, and are sold to Saudi Arabia, where they have regularly been used in the war in Yemen.

Lockheed Martin, the world’s largest arms company, employ 1,800 people in the UK.

General Dynamics have 1,500 UK employees in their UK subsidiary, of which 900 are in Wales. GDUK produce military vehicles, as well as avionics and military communications systems.