The Defense Department on Tuesday published a detailed outline of how it plans to spend tens of billions of dollars each year to shore up its industrial base over the near and long term, filling in many of the gaps that were left unanswered when the department issued its first-ever National Defense Industrial Strategy (NDIS) in January.

In fiscal 2025, the newly released implementation plan characterizes $38 billion of the Pentagon’s budget as contributing to the overall industrial base revitalization effort. For this year at least, the vast majority of that funding is targeted toward programs where the department thinks domestic industrial capacity has dwindled, particularly in the areas of missiles, munitions, and in the submarine industrial base.

By the end of the year, officials plan to draft a classified supplement to this week’s implementation plan that will lay out what they see as the biggest risk areas in the industrial base.

Dr. Laura Taylor-Kale, the assistant secretary of Defense for industrial base policy, said even the $38 billion figure doesn’t fully reflect the department’s industrial base development plans, because the 2025 budget was built before the strategy was finished.

“The fiscal 2026 [planning process] is the first one where we’ve actually, as a whole department, really had an opportunity to think about and match our program and budget planning processes with the National Defense Industrial Strategy,” she told reporters at the Pentagon. “I think there was a definite understanding across the board of the importance of building capacity in the defense industrial base and also bringing in non-traditional companies.”

More than just money

But the implementation plan isn’t just about funneling more money into areas where officials want to see more capacity. The other five initiatives are largely about policy.

One, for instance, focuses specifically on better understanding DoD’s supply chains, and once they’re better understood, taking steps like onshoring critical supply sources to guard against adversarial interference.

“Addressing the supply chains for key enabling current and future technologies is going to be incredibly important. We have been looking at supply chain vulnerabilities where we have single sources or fragile sources where we need to shore up the industrial base,” said Dr. Carla Zeppieri, the deputy assistant secretary of defense for industrial base resilience. “But likewise, the implementation will involve looking at key critical nodes to enable future capabilities. Some of that is outlined in the unclassified plan, and I believe that there will be additional details in the classified annex.”

Modernizing organic industrial base

The plan also takes DoD’s own industrial capacity into consideration.

As part of another initiative, focused on modernizing industrial base infrastructure and the industrial workforce, the department plans to spend billions of dollars a year updating its own depots and other parts of the “organic” industrial base.

“Fostering a 21st Century defense industrial base requires investment in infrastructure and fundamental industrial capability to meet strategic and key operational requirements,” Taylor-Kale said. “Modernizing the nuclear industrial base, the organic industrial base and our maintenance, repair and overhaul capacity will lay the groundwork for generating the systems that we need.”

The department also thinks acquisition and contract policy will play a big role in strengthening the industrial base, including by using more “flexible” contracting procedures to buy new capabilities.

That will largely mean continuing down the same pathways DoD has already been on for the past several years: making more use of nontraditional acquisition approaches like the “middle-tier” of acquisition and other transaction agreements (OTAs).

“The department has been moving in this direction for a while, but the truth is we don’t oftentimes use these flexible authorities,” Taylor-Kale said. “The important thing to note is using these flexible acquisition pathways when appropriate. Really what we’re measuring and tracking here is what [mechanisms] we’re using, and whether or not it is appropriate for a particular project or contract vehicle. It’s important to have OTAs — they can be very useful. But at the end of the day, we’re all trying to make sure that the warfighter has the tools and capabilities they need at speed and scale. We need things to move into production, so what’s the best way to do that for the particular capability that we’re looking at?”

Near and long term efforts

Another longer-term initiative involves DoD’s policies around intellectual property. The plan calls for the department to find ways to balance the military’s needs to obtain the IP it needs to manage the systems they buy throughout their lifecycle, keeping acquisition programs from overusing proprietary technology, and keeping competition in the system.

Taylor-Kale said DoD is likely to need help from Congress on those long-term IP efforts — and it’s one of many areas that will be updated in future versions of the implementation plan.

“Going forward, the department will continue to use this document as sort of a baseline and also build on it,” she said. “Our plan is to update the implementation plan every year, and preferably to publish the revised unclassified plan after the new President’s budget has been delivered to Congress, and explain what’s in the President’s budget request and how it relates to defense industrial capacity and what the priorities of the department are.”

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