Loren Thompson - How Trump Can Fix The Army's Tank Fleet, Deter Russia and Boost Midwest Manufacturing -- In 5 Years

The last plant in the U.S. that can build tanks is a sad symbol of America's industrial decline. Located in Lima, Ohio, midway between Dayton and Toledo, it currently produces only one M1A2 Abrams tank per month. During the Reagan years, it turned out 60 per month. Another 60 were built each month at the Detroit Arsenal Tank Plant, but that site was closed during the Clinton years. So now there is only Lima, assembling a mere dozen tanks per year.

They're still the best tanks in the world, but they won't be for long if they aren't upgraded. The Congressional Research Service warned earlier this year that "in the not-too-distant future, foreign armored vehicle design and capabilities could surpass existing U.S. systems." The biggest threat comes from Russia, which is modernizing its own tank fleet with an eye to becoming the dominant military power in Europe.

That won't be hard. The U.S. only has two relatively light brigades permanently stationed in Europe, and Germany -- once the most fearsome military power in the world -- has reduced its Cold War tank fleet 90% to a mere 256 tanks. If America's Army doesn't field a bigger force of tanks in the NATO region that can at least match the capabilities of Russia's latest armored vehicles, Russia really could dominate. It already has an edge in everything from long-range fire to electronic warfare.

An Abrams tank in Iraq. The heavily armored Abrams is still the best main battle tank in the world, but as Russia and other countries upgrade their own armored vehicles, Abrams needs to be modernized to a more lethal and survivable version. Wikimedia

An Abrams tank in Iraq. The heavily armored Abrams is still the best main battle tank in the world, but as Russia and other countries upgrade their own armored vehicles, Abrams needs to be modernized to a more lethal and survivable version. Wikimedia

Which brings me back to the Lima tank plant. The Army has a plan to upgrade 1,300 of its Abrams tanks to the most modern version, with better sensors, improved communications, increased electrical power and a host of other enhancements. It is a necessary move since planners say Abrams will likely remain the Army's signature combat system for another 50 years. But the plan is funded at such a leisurely pace that a soldier could graduate from West Point today and the fleet still wouldn't be fully modernized when he or she retires in 20 years.

Because the plan only envisions building 60 tanks per year -- five per month -- each one will cost top dollar. It won't do much for the struggling Abrams supply chain in places like Indiana, Michigan and Pennsylvania, where key items such as the transmission and tracks are made. More importantly, it won't do much to even up the military balance in Europe, where Russia today could easily overwhelm Western neighbors with its increasingly capable armored vehicles.

So now comes Abrams prime contractor General Dynamics with a proposal to pick up the pace of tank modernization to a level where the Army's modernization goals could be met in five years rather than waiting until the 2040s. Instead of building 60 tanks per year, GD wants to build 264 -- enough to equip three armored brigades each year. The higher number wouldn't just enable the Army to meet the Russian threat in Europe, it would also deliver efficiencies reducing the cost of each tank by at least 15%.

Or said differently, the Trump administration could save $3.6 billion by awarding a contract to modernize all 1,300 tanks to the latest version in five years. Part of the savings come from economies of scale, part from the planning efficiencies allowed by multiyear contracts. In the process, the administration would also create over a thousand manufacturing jobs in the nation's struggling industrial heartland. President Trump has said he would like to reduce the price-tag for tanks, and GD's plan would make that possible.

The reason I know about this plan is that General Dynamics contributes to my think tank and is a consulting client. So I've been watching the company struggle to keep its tank production capability viable for years. At one point, the Army wanted to close the plant entirely, leaving the U.S. with no ability to build new tanks. Now it recognizes the growing threat from Moscow's modernizing armored fleet, but can't find the funding to respond in a timely fashion.

The Obama administration proposed to dedicate only five hours of federal funding to armored vehicle procurement in 2017, and a mere fraction of that would have gone to tanks. That's pretty much the way things went during the Obama years. The Lima plant was renamed the Joint Systems Manufacturing Center in 2004 because planners thought it would be where the Marine Corps would build its next amphibious landing vehicle. The administration killed that program outright, and then tried to shut down Army tank production.

So when President Trump says he wants to rebuild the military, that isn't just a rhetorical flourish. The U.S. Army isn't ready for combat with a near-peer adversary like Russia, and fixing the problem starts with its signature combat system. The nice thing about the GD plan is that it also cuts the cost of each tank, which is what Trump told Sean Hannity of Fox News he wanted to do, and it boosts heavy manufacturing in the Midwest. And unlike building warships or bombers, this plan can be completed during Trump's tenure in the White House.

Heaven knows Lima, Ohio, could use the jobs. Since the Army began developing the Abrams tank in the 1970s, the town has lost 8,000 industrial jobs and nearly a third of its population. Donald Trump is in the White House today because voters in places like Ohio rebelled against leaders who did nothing to stop the exodus of manufacturing jobs to other countries. By speeding Abrams tank modernization, President Trump can both rebuild the military and rebuild manufacturing -- while saving billions of taxpayer dollars in the process.