Secretary of Defense Pete Hegseth came to Tarrant County on Monday with a message for defense contractors: deliver results, or risk losing out on new federal money.
The visit comes as President Donald Trump rolls out a new executive order aimed at holding defense companies accountable for performance. For decades, major contractors have faced criticism for running over budget and behind schedule. The White House says that’s about to change.
Trump wants to increase military spending from $1 trillion to $1.5 trillion in the next budget cycle — a huge boost that could mean more work for defense firms across North Texas. But this time, the money comes with strings attached.
“We live in a realistic world where if you want American strength, you better have American manufacturing,” Hegseth told a crowd gathered at Lockheed Martin’s Fort Worth facility.
Lockheed’s F-35 Joint Strike Fighter program is one of the country’s largest defense projects, but it’s also had its share of delays and cost overruns. Hegseth said the president’s new order is designed to change that — speeding up production while banning stock buybacks and investor payouts for underperforming companies.
“How big defense contractors in this country need to step up. And he’s right. I’m looking out at an incredible audience here who are part of an incredible company building incredible platforms. And I think, and I know, and I believe, that Lockheed will step up,” Hegseth said.
Lockheed recently signed a new missile agreement with the Department of Defense, using its own funds to pay for expansion.
“We have the utmost commitment on your behalf to continue to bring it, to provide for the very best kit, very best product, very best service on behalf of our war fighter,” said Greg Ulmer, president of Lockheed Martin Aeronautics.
Other major defense companies — including Boeing, General Dynamics, Northrop Grumman and Raytheon — also have a large presence in Tarrant County. It’s not yet clear how they’ll respond to the new requirements.
Hegseth said he plans to create a list of companies that comply with the new order within 30 days. He could also gain authority to cap executive salaries.
“Where your leadership knows that it’s not just about Wall Street and dividends and stock buybacks. It’s about the warriors and what we can deliver,” Hegseth said.
The new order is part of a larger military buildup that hasn’t been seen in years. A 2023 Defense Department study found that from 2010 to 2019, major contractors spent more on stock buybacks and investor payments — and less on new factories and expansions.