Josselin DROFF, researcher at the Chair Economy Defence participated in the’study N°64 of the’IRSEM produced by Antoine PIETRI (Doctor of Economics and researcher at IRSEM) and Benoît RADEMACHER (ICA and Director of the Armaments and Defence Economics Department at IRSEM).
The study is entitled« Impact of new industrial business models on military equipment« . The authors examine the impact of the’changing technological and strategic environmentse on equipment life cycles armies.
Two major trends are identified: exponential improvements in technology, accompanied by an increase in strong duality of facilities (1) and a growth in equipment costs (EM) throughout their life cycle (design, production and maintenance in operational condition in particular) (2). These changes have resulted in adapting industrial business models which may lead to a reduction in the useful life of certain MS. In particular, manufacturers are looking to smooth out their workloads and sell services (such as maintenance in operational condition - MCO).
The study focuses on a solution which consists of offering used military equipment and limit the lifespan of equipment «consumables».
Several benefits to this solution were identified and developed by the authors in the study :
- Modernising the fleet of EMs used by the armed forces.
- Reduce the tendency of certain MS to over-specify.
- Boosting France's defence technological and industrial base (DTIB).
- Promoting the retention of strategic skills.
However, some risks are highlighted and examined:
- Risk to interoperability (joint and international).
- Growing need for staff training.
- Risk of creating competing DTIBs.
- Risk of arms proliferation.
Following on from this study, three recommendations have been formulated to examine in greater depth and better define the issues associated with a possible strategy for reselling MS :
- Making economic analyses to assess the optimum replacement age for certain MS, based on the costs and benefits associated with their use
their replacement/maintenance. - Making a comparative study of export policies second-hand weapons from the Netherlands, Germany and Sweden.
- Conducting a market research the entire Second-hand EM.
