U.S. officials claim that Israel is running low on ballistic missile interceptors.
Semafor reports, "Israel had reportedly entered the current war already low on interceptors that were fired during last summer’s conflict with Iran."
Further, Semafor says, "Israel’s long-range defense system has strained under Iran’s attacks; CNN reported that Iran was adding cluster munitions to its missiles, which may exacerbate the depletion of the stock."
Israel denies the report, and well they should. Giving Iran any hope that it will eventually be able to penetrate Israel's defenses will keep them fighting. Part of the equation is economic; a $4 million interceptor is used to shoot down a $35,000 drone, meaning that Iran can manufacture a lot more drones than Israel or the U.S.can make interceptors.
The U.S. has its own problems with depleted stocks of critical munitions.
“We’ve vaporized years and years of missile defense interceptors in a matter of hours,” said Tom Karako, director of the Missile Defense Project at the Center for Strategic and International Studies (CSIS). “And we’ve been expending Tomahawks far faster than we’ve been producing them for the past decade.”
The Free Press's Sean Fisher asks, "If a long-planned air campaign against a weaker foe could so heavily tax our weapons supply, what would war with China spell, in the event of, say, a 2027 Taiwan invasion?"
You would think we'd have plenty of money to get the job done. FY 2026 defense spending will top $1 trillion for the first time. This figure comprises approximately $838.5 billion in base discretionary spending, supplemented by over $150 billion in mandatory funding allocated through recent reconciliation acts.
Almost half of the budget is devoted to "operations and maintenance" and military personnel. Readiness is critical, and feeding, clothing, housing, and paying our professional military personnel are necessities.
Just $161 billion is devoted to procurement, about the same amount as to R&D. If we're going to replenish munitions stocks from the Iran conflict and once again make America an "Arsenal of Democracy," an entirely new way of thinking about our national defense has to happen.
There's a new breed of defense tech companies that are bringing innovative solutions to the battlefield of the future, which has arrived ahead of schedule.
In the face of a rising China, a hot war in Iran, and an assertive Russia, this new defense tech class sees America’s preparedness for war as suffering from a twofold problem: a lack of modern warfighting tools, and an inability to manufacture those tools at the volume needed to guarantee victory. And they’re trying to do something about it.
Anduril is building self-flying fighter jets. Saronic is manufacturing autonomous naval vessels. Ursa Major is making mass-producible missiles.
The war in Iran—where $4 million interceptors manufactured by legacy defense firms are being expended to shoot down $35,000 drones—seems to have validated their thesis. And the Pentagon agrees, at least judging by the nearly $20 billion, 10-year contract it awarded Anduril just days ago.
Despite our sizable edge in several categories of defense tech, the U.S. has yet to mass-produce a hypersonic missile. Russia has had a nuclear-capable missile able to fly 20 times the speed of sound since 2019. China has had a hypersonic missile since 2020.
The U.S. has been playing catch-up in hypersonic missile tech largely because the Defense Department had other priorities. So in 2018, Congress designated hypersonics a key technology and appropriated $13 billion to build them.
But instead of building a single system, the Army, Navy, and Air Force each built its own missile. "But after years of development, repeated delays, and billions of dollars spent, contractors for the U.S. military are capable only of producing one such missile a month. Each is reported to cost almost $41 million," according to The Free Press.
Castelion, a company that was formed by a group of former SpaceX leaders, has been working since 2022 to build its own hypersonic missile and claims it can make them cheap, scalable, and fast.
“The U.S. spends a very large sum of money on defense,” said Bryon Hargis, Castelion’s co-founder and CEO, “and we need to get more for that money.”
“Over the past several decades,” he added, “we’ve become really complacent in our ability to move quickly and adapt and to build the latest thing and then actually deploy it at scale.”
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Sean Pitt, another of Castelion's co-founders, said: “The reality is, the traditional model that the primes [large military contractors like Raytheon and Lockheed Martin] are using today is optimized to limit risk through an extremely long development cycle.”
“The system is producing what it’s good at”—i.e., reliable, high-end weaponry—“but it’s also producing what it’s known for: terrible cost, terrible schedule, not very good quantity production,” said Hargis.
Castelion’s answer is to embrace risk upfront, redesigning quickly as the company iterates along the way—and focus relentlessly on cost. “Engineers not only have to come with reasons why they believe a system can technically perform, they also have to come with a plan for how to hit a target cost and manufacturing rate,” Hargis explained. “That doesn’t lead to 10 percent better outcomes. You’re talking an order of magnitude cheaper.”
In our conversation, Hargis repeatedly mentioned the Apollo space program, which grew out of the Cold War, as a good example of America’s embrace of rapid technological and manufacturing prowess in the face of immense geopolitical risk.
At SpaceX, where Hargis, Pitt, and Andrew Kreitz—co-founder and CFO—met, Castelion’s founding team saw firsthand how a space-race mentality propelled the start-up past a stagnant NASA. “Elon showed that the Apollo era is not dead,” said Hargis. “SpaceX proved that not everything has to be hard and slow. That led to opportunities for companies like ours to apply the same model and to have it taken seriously.”
Hargis noted that “The government has been flexible enough to give us the problem they want to solve, not how to solve it.” That makes all the difference. And while these new defense tech companies will succeed or fail based on the products they develop, they are likely to revolutionize the stagnated legacy defense industry and light a fire under them to improve or lose.
