Worried About Chinese Backdoors, Lord Pushes For New Tech Strategy

WASHINGTON: The Pentagon’s top acquisition official says the military is doubling down on efforts to move microelectronics manufacturing away from China, citing worries about the security of supply chains.

A full 75% of microelectronics manufacturing and 98% of packaging takes place in Asia, acquisition boss Ellen Lord said at the ComDef conference today.

“While the U.S. continues to serve as the leader in microelectronics research and development,” Lord said, “our lack of ability to manufacture, package and test, has resulted in the loss of employment opportunities, economic growth and the lack of ability to fulfill DoD requirements.”

Lord added that Pentagon leadership is currently working to develop a “microelectronics strategy,” which would rely on things like public and private partnerships to bring the microelectronics manufacturing and testing industry to the US.

The mass disruption of global supply chains this year caused by the COVID-19 epidemic has brought those lessons home to DoD leadership, Lord said. “The pandemic has reinforced the importance of securing and diversifying our supply chains, especially when partnering with allied or partner nations to utilize or develop capabilities overseas.”

“COVID-19 has given the department greater visibility into major fragilities in our supply chains, both domestically and with foreign suppliers,” she added. Only 12% of the world’s massive microelectronics market manufacturing happens in the US, and just 3% of packaging and testing.

Lord didn’t offer any details about how the DoD and federal government would boost manufacturing in the US o, but it would be in keeping with President Trump’s four-year effort to expand domestic manufacturing, a project that has actually seen many states continue to lose manufacturing jobs.  

Moving technology production from China to the US would also be in keeping with the Trump administration’s tariffs on various Chinese industries that have tried to pressure Beijing to enter into new trade agreements with Washington.

Earlier this month, Sen. Mark Warner decried the lack of domestic manufacturing capability for high-tech components, and the reliance that many US telecom companies still have on China’s 5G giant Huawei. Warner co-authored legislation with Republican Sen. Roger Wicker to help stop that tech from being sold in the US.

The issue is even more acute when it comes to new generations of military technology, many of which have suspect, foreign-made components inside. “The idea that we would roll out all these sensors and devices without … some minimum security standards, it’s pretty crazy to me,” Warner said. 

“We’re making a huge error by not getting ahead of this and putting in standards, and so far from the legislative side and frankly from the [National Institute of Standards & Technology] side, I don’t think we’ve been forward-leaning enough.”