RAND released the report, “Anticipating Allies’ Responses to U.S. Retrenchment from Europe,” on Wednesday. It examines how France, Germany, Poland and the U.K. would likely respond to different versions of what RAND calls limited retrenchment: cuts to American commitments and forces in Europe that stop short of leaving NATO altogether.

The study draws on Cold War precedents, allied government documents and public debate, and interviews with 51 officials and experts in the four countries, most conducted between April and November 2025.

The authors caution that their findings apply only to those four allies.

The report’s main finding is that how the U.S. withdraws will shape how allies respond. The four allies “see a stark difference between a coordinated, orderly U.S. withdrawal, which they feel they could handle, and a rapid, uncoordinated one, which they see as creating major capability gaps and potentially emboldening Russia to attack a NATO member,” the authors wrote.

The authors recommend the U.S. follow through with larger force cuts on a long-term timeline worked out with allies, which they say may help keep allies’ defense spending on track even as it gets harder to sell at home.

RAND weighs those choices against NATO 3.0, the alliance concept Under Secretary of Defense for Policy Elbridge Colby presented in February. It calls for Europe to take primary responsibility for its own non-nuclear defense while the U.S. shifts resources to the Western Hemisphere and the Pacific.

The Pentagon has already begun reducing its footprint in Europe. About 80,000 U.S. troops were stationed there across roughly 30 bases as of 2025, according to congressional testimony from the head of U.S. European Command cited in the report.

In May, the Pentagon announced it would pull about 5,000 troops out of Germany. Then in June, the U.S. cut the forces it would make available to NATO in a crisis. A review of U.S. forces in Europe is underway.

Defense ministers from France, Germany, Italy, Poland and the U.K. said Monday in a joint statement that Europe “must assume greater responsibility for its own security.” They also called the U.S. “an indispensable Ally.”

Arms sales at risk

A sudden pullout would put allies in a bind, U.K. interviewees told RAND. In the short term, they would have little choice but to buy off-the-shelf equipment, often from U.S. suppliers, to fill gaps. Over the long term, broken trust would push allies toward European or homegrown alternatives, the authors concluded.

In Britain’s case, a sudden withdrawal would “accelerate the UK’s reorientation away from U.S. defense equipment toward sovereign or European alternatives,” those interviewees said. The authors expect Germany, and possibly Poland, to reach a similar conclusion.

Germany has bought U.S. arms partly to keep Washington committed to Europe. A rapid, uncoordinated withdrawal would suggest that approach had failed, and Berlin “may not see a benefit to continuing to privilege U.S. firms for arms sales or other deals,” the authors write.

“Such a shift would be detrimental to the U.S. defense industrial base, which benefits from exports that help create economies of scale,” the report said. “The main cause of this shift would be perceptions of U.S. reliability as an ally rather than the loss of any specific U.S. military capabilities.”

The U.S. supplied 58% of the major weapons European NATO members imported from 2021 to 2025, according to the Stockholm International Peace Research Institute, down from 64% in the institute’s previous five-year count.

In Monday’s statement, the five ministers also committed to “closer defence-industrial cooperation.” But British Defense Secretary Wes Streeting said Oct. 15 that buying European or American equipment “should not be an either/or choice.” British industry produces about 15% of each F-35, he told the Center for Strategic and International Studies in Washington.

A sudden U.S. pullout would likely have little impact on how much France buys from U.S. defense companies, as Paris is already “the most committed of the four allies to reducing reliance on the United States,” the study said.

During wartime, however, French officials told RAND their military would still count on U.S. forces for intelligence, surveillance and reconnaissance; long-range precision strike; fighter jets; air and missile defense; command and control, the systems used to direct forces in combat; and logistics.

Until France can fill those gaps itself, Paris would see a sudden U.S. pullout as a sign Washington cares little about its allies’ security, the authors wrote. That could make the two countries less likely to agree on military plans or diplomatic initiatives.

Intelligence sharing

The authors also looked at what would happen if the U.S. moved to normalize relations with Russia while the war in Ukraine continued, without addressing Europe’s security concerns. In that case, allies might limit intelligence sharing and joint military planning, fearing leaks to Moscow.

Some allies have already begun limiting intelligence sharing over other disagreements with Washington, albeit modestly, the report said. It cites U.K. concerns about U.S. military operations in the Caribbean, and Dutch concerns about U.S. policy toward Russia, which led both countries to reduce some intelligence sharing.

Still, none of the four allies would side with Russia or China on security under any scenario RAND examined, the authors concluded.

“Some strategists’ fears about allies aligning with Russia as the United States draws down are overblown,” the authors wrote. The four countries and Italy called Russia “the most acute and long-term threat to Euro-Atlantic security and stability” in Monday’s statement.

Spending gap

A limited pullback is more likely to spur allies to spend more and work more closely together, the authors found. All four have committed to NATO’s target of at least 3.5% of gross domestic product, or GDP, for core defense spending by 2035, according to the alliance’s 2025 summit declaration.

Poland has more than doubled defense spending as a share of GDP since 2014 and is aiming for 5% this year, the report said. Germany plans to spend €649 billion on its military over five years, raising spending from 2.4% of GDP in 2025 to 3.5% by 2029, Defense News reported.

France and the U.K. will struggle to meet NATO’s target because of high debt and slow growth, the report said. French public debt rose from 98% of GDP in 2019 to an average of 112% from 2020 to 2024. One interviewee called the budget problem France’s “Achilles’ heel” in rearming.

The U.K. Ministry of Defence asked for an extra £28 billion to cover a shortfall through 2030 and received £15 billion, the report said. The British government said Oct. 28 it would fully fund its Defence Investment Plan, Reuters reported.

Troops as leverage

The authors also warn against using troop levels to reward or punish individual allies. Questionnaires the Pentagon sent allies as part of the review asked about their defense spending and support for U.S. foreign policy priorities. Some allies read that as a sign troop decisions would hinge on political alignment, the report said.

Poland has already seen how quickly U.S. troop decisions can change. In May, the Pentagon abruptly canceled a planned deployment of about 4,000 soldiers to Poland. President Donald Trump later pledged to send 5,000 troops at an unspecified date. Warsaw credited the reversal partly to reminding Washington that Poland is a “model ally” that buys U.S. systems.

The authors said the episode demonstrates both the payoff Poland expects and the weakness of its approach: U.S. troop levels and commitments rest on “abrupt, easily reversible decisions.”

Call for a plan

“NATO 3.0 is a vision for a reduced U.S. role and reallocation of resources. But there is no concrete, long-term plan,” the report said.

The authors urge the administration to work with allies to set how many U.S. troops stay in Europe in peacetime and how many the U.S. would send in a war, along with a timeline to get there.

It is unclear whether the Europe review will produce such a plan. Under a Pentagon document seen by Reuters in August, the review is due to give Defense Secretary Pete Hegseth at least four sets of troop options by Nov. 6. The full review is due in December.

Predictable long-term plans that give allies a say “could sustain a continued, if reimagined, transatlantic partnership,” the authors wrote. Adding that treating troops and commitments as bargaining chips, by contrast, “could undercut regional cooperation and, in turn, NATO 3.0’s goal of European strength.”

APKWS kits convert unguided 2.75-inch rockets into laser-guided munitions. All four services field them, and the weapon has become a cheaper alternative to air-to-air missiles for shooting down drones.

Congress still has to approve and fund the buy, the department said. BAE said it will increase production while the two sides work out a multiyear contract. Neither side announced the deal’s cost.

The framework also outlines a path to increase output to 35,000 kits a year for U.S. allies. The department said that added capacity will come online as partner nations formally request kits through the Foreign Military Sales program.

“By securing multi-year demand, this agreement keeps production lines running at capacity, provides our forces with interceptor inventory, and flips the cost calculus in the taxpayer’s favor,” Michael Duffey, the Pentagon’s undersecretary for acquisition and sustainment, said in the announcement.

BAE, which builds the kits in Hudson, New Hampshire, and Austin, Texas, said in February that it had delivered its 100,000th kit.

The 25,000 figure in this framework agreement matches capacity BAE has cited before. A company official said in 2023 that APKWS was in full-rate production with room to grow to 25,000 units a year.

“APKWS delivers proven, reliable and affordable precision at scale to counter evolving threats and ensure our warfighters maintain a decisive advantage,” said Tom Arseneault, president and CEO of BAE Systems Inc.

The Navy’s current five-year APKWS contract with BAE, awarded in August 2025, is worth up to $1.74 billion. It covers up to 55,000 kits for the Navy, the Army and foreign customers, with work expected to be completed by December 2031.

Among allied buyers, Saudi Arabia won State Department approval in July for a possible $1.96 billion package that includes up to 20,000 APKWS kits, split evenly between air-to-air and air-to-ground versions. Italy is also weighing a buy of 5,031 kits for counter-drone defense.

The APKWS agreement is the latest in a series of framework deals the Pentagon has signed this year to boost munitions production.

In January, Lockheed Martin agreed to more than triple production of the Patriot Advanced Capability-3 Missile Segment Enhancement, or PAC-3 MSE, interceptor.

In March, BAE and Lockheed agreed to quadruple production of seekers for the Terminal High Altitude Area Defense, or THAAD, interceptor. A separate THAAD framework signed in January led to a June contract worth more than $35 billion for the interceptors themselves.

The Oct. 5 revision adds jets damaged in a September Iranian strike on a base in Jordan, helicopter losses drawn from a Pentagon inspector general report and a sharply higher count of lost Reaper drones.

CRS cautions that the total is not a count of destroyed aircraft, noting, “Some damaged aircraft may have been returned to active service.”

The research service works from public information, drawing on news reports and statements from the Defense Department and U.S. Central Command. This version also draws on the inspector general report published Sept. 14. CRS said its count “may remain subject to revision due to multiple factors, which may include classification, ongoing combat activity, and attribution.”

The deadliest loss on the list remains the March 12 crash of a KC-135 Stratotanker. Two of the seven KC-135s in the report were involved in an incident over friendly airspace. One crashed in western Iraq, killing all six crew members. The other made an emergency landing at Ben Gurion Airport in Israel, Defense News reported. Central Command said the loss was not the result of hostile or friendly fire.

A Navy squadron commander was lost when one of the newly listed aircraft went down. An MH-60S Sea Hawk from the aircraft carrier George H.W. Bush made an emergency landing in the Arabian Sea on July 1. The Navy said there was no indication of hostile action.

Three of the four crew members aboard were recovered. The Navy identified the fourth as Cmdr. Gabriel Edwards, commanding officer of Helicopter Sea Combat Squadron 5, and suspended its search for him July 5 after more than 102 hours. Acting Navy Secretary Hung Cao directed that Edwards be posthumously promoted to captain.

Several of the aircraft on the list trace to the April mission to recover the two-person crew of an F-15E Strike Eagle shot down over Iran. Both crew members were rescued in separate search-and-rescue operations. That jet is one of 12 Strike Eagles on the list.

An A-10 Thunderbolt II supporting the rescue mission crashed after taking enemy fire, Joint Chiefs Chairman Air Force Gen. Dan Caine said. The pilot flew the damaged jet out of Iran and ejected over friendly territory, where he was quickly recovered.

An HH-60W Jolly Green II combat rescue helicopter in the same task force was damaged by small-arms fire, Caine said.

The second crew member was rescued nearly two days later in a separate special operations mission. Two MC-130J Commando II transports that had flown the commandos into Iran suffered a mechanical failure and could not take off, Reuters reported.

U.S. troops pulled the rescue force out in stages and destroyed the two transports and four helicopters rather than leave sensitive equipment behind. The inspector general later said U.S. forces destroyed four AH-6 Little Bird helicopters during rescue operations, likely those four. The May version listed no Little Birds, a gap Defense News noted at the time.

Iranian strikes on two air bases account for 15 of the aircraft on the list, all damaged on the ground.

An Iranian missile strike on Prince Sultan Air Base, Saudi Arabia, damaged five KC-135s on the ground in mid-March, Defense News reported, citing two U.S. officials who spoke to The Wall Street Journal. Iran hit the base again on March 27, damaging an E-3 Sentry in what the CRS report, citing a September article, described as “a direct hit.”

The seven KC-135s on the list come from a fleet that was already stretched thin. As of March, the Air Force had 373 KC-135s and 103 KC-46As, the Government Accountability Office, or GAO, said in a June report. GAO found the fleet fell short of the Air Force’s own readiness goals every year from fiscal 2019 through 2025.

The E-3 fleet is far smaller. The Air Force operated only 16 E-3s before the war began, and six had deployed to Prince Sultan. CRS cites the E-3 as an example of aging, scarce aircraft where losses could leave the military short elsewhere in the world, and suggests Congress may want to weigh that risk.

The other base struck by Iran, Muwaffaq Salti Air Base in Jordan, came under ballistic missile attack Sept. 8-9. The second A-10 on the list lost a wing, and eight F-15Es took light damage and were returned to service, a U.S. official told Reuters.

The official said U.S. forces fired roughly 30 Patriot interceptors to defend the base. Three Army soldiers were killed there in a separate missile attack in July.

Drones account for most of the increase since May. The report now counts 45 MQ-9 Reapers lost, citing an Aug. 13 article in which three U.S. officials said the military had lost “at least 45.” That is up from as many as 30 destroyed through June 30, according to the inspector general report.

Air Force Chief of Staff Gen. Kenneth Wilsbach has called the Reaper perhaps the most valuable player of Operation Epic Fury. The Air Force had 135 MQ-9As as of May, down from 351 in fiscal 2022 as the service retired older models and lost aircraft to accidents and combat, according to a separate Sept. 23 CRS report.

The service had already stopped buying the drone in favor of a planned successor, and its fiscal 2027 request included no money for new Reapers, Military Times reported.

The remaining three of the 12 Strike Eagles on the list were the war’s first aircraft losses. A Kuwaiti F/A-18 Hornet mistakenly shot them down over Kuwait on March 1-2, Defense News reported. All six aircrew ejected and were recovered, Central Command said.

The list also includes an Army AH-64 Apache that the inspector general said was shot down over the Strait of Hormuz. U.S. officials said a Navy drone boat rescued its two-person crew after the June 8 crash, calling it the first rescue of its kind.

Iranian ground fire also damaged an F-35A Lightning II during a combat mission over Iran on March 19, forcing an emergency landing at a U.S. air base in the region. The aircraft landed safely, and the pilot was in stable condition, Central Command spokesman Navy Capt. Tim Hawkins said at the time.

The report also counts three MQ-1 drones downed by Iran, one confirmed by Central Command in May and at least two more reported by U.S. officials in September. Central Command has not specified which variant was lost. The Air Force retired its MQ-1 Predators in 2018, but the Army still flies the related MQ-1C Gray Eagle.

A Navy MQ-4C Triton surveillance drone crashed April 9 at an undisclosed location, according to Naval Safety Command data, which did not give a cause.

The revision leaves unresolved two discrepancies Defense News flagged in May.

The report still lists the E-3 as damaged. Multiple outlets reported the aircraft was destroyed. Photos published by The War Zone purportedly show tail 81-0005 with its rear fuselage burned through, and Air & Space Forces Magazine reported the damage likely renders the aircraft unrepairable.

The report also still counts one damaged HH-60W. At an April 6 news conference, Caine described two helicopters in the rescue flight taking fire, with a crew member on the trailing aircraft suffering a minor injury.

The war’s cost has also climbed significantly since May. Acting Pentagon Comptroller Jules Hurst told House appropriators on May 12 that it was closer to $29 billion. The Congressional Budget Office, or CBO, estimated in September that the war had cost the Pentagon about $38 billion through Aug. 1.

That total includes the cost of replacing equipment lost in battle, which CBO put at $1.9 billion, or as much as $3.3 billion if the Pentagon sought emergency funding to replace all of it. Among that equipment is a THAAD missile defense radar Iran destroyed. CBO said its estimate relied on government databases and public reports because the Defense Department did not respond to its requests for information.

The White House asked Congress in June for $87.6 billion in emergency funding, including $67.1 billion for the Pentagon. Congress has not approved the request.

The five-year contract, which includes two option years, is part of the Pentagon’s Arsenal of Freedom campaign to bolster weapons production. The department awarded it Sept. 25 and announced it Monday with RTX, Raytheon’s parent company.

The department said the award is a joint buy by the Air Force, the Navy and allies.

“We are working across the defense industry to ramp production and build the Arsenal of Freedom,” said Michael Duffey, the under secretary of defense for acquisition and sustainment, in a statement. “This award strengthens our ability to equip the Joint Force and our allies with a proven air-to-air capability, ensuring our warfighters maintain a decisive advantage.”

The $20.7 billion ceiling dwarfs the Pentagon’s previous record AMRAAM award, a $3.5 billion contract issued in July 2025. That deal covered missiles for the Air Force, the Navy and allies in Europe, Asia and the Middle East.

The department thanked Congress for multiyear procurement authority, which lets the Pentagon commit to buying missiles over several years instead of one at a time. It said it hopes lawmakers will provide more authority and funding to sustain production.

Congress hasn’t yet funded the full deal, according to Reuters, which called the award provisional. Industry executives have warned that defense contractors may hold off on big investments in parts and factories until lawmakers act, Reuters reported.

The award comes as the Pentagon works to rebuild munitions stockpiles drawn down by the war with Iran.

The contract follows five framework agreements Raytheon signed with the department in February, which set long-term production targets ahead of formal contracts. Under those deals, RTX committed to raising annual output to more than 1,000 Tomahawks, at least 1,900 AMRAAMs and more than 500 Standard Missile-6 interceptors.

Neither the Pentagon nor RTX specified how many missiles the new contract buys or an associated annual production rate.

Raytheon President Phil Jasper said in a statement that the company continues to invest in its workforce, supply chain and facilities to “rapidly scale production capacity and meet surging demand” from the Air Force, Navy and international customers.

RTX said it nearly doubled production of AMRAAM and other munitions in 2025 compared with 2024 and is now exploring international co-production.

According to RTX, AMRAAM is the world’s most widely deployed air-to-air missile, fielded by 44 countries, and the primary interceptor for the National Advanced Surface-to-Air Missile System. Reuters reported that the ground-based air defense system defends the Washington area and is used by more than a dozen other countries.

The Pentagon is also preparing to build AMRAAM’s successor. Earlier this month, the department signed a framework deal with Lockheed Martin to boost production of the AIM-260 Joint Advanced Tactical Missile, which is being developed for the Air Force and Navy to outrange and eventually replace AMRAAM.

The deals cover avionics and ejector assemblies Boeing supplies to prime contractor Raytheon, an RTX business, for both the SM-3 Block IB and the newer Block IIA. Both variants operate with the Aegis Ballistic Missile Defense System to destroy incoming missiles outside the atmosphere.

“These agreements ensure our Warfighters get the munitions they need to win,” Michael P. Duffey, under secretary of war for acquisition and sustainment, said in the Pentagon release. “We are stabilizing our supply chains, expanding munitions production and putting our entire defense industrial base on a wartime footing.”

The frameworks run for seven years and allow Boeing to start building components before a contract is in place, while the three sides negotiate a multiyear deal. The long-term commitment is intended to give suppliers enough certainty to invest in added capacity. Neither the Pentagon nor Boeing released dollar figures or quantities.

“This gives us a clear demand signal to build and deliver SM-3 interceptors at the levels needed to counter threats,” Bob Ciesla, vice president of Boeing Precision Engagement Systems, said in a company statement. “The SM-3 is an essential part of the layered air and missile defense architecture that protects the U.S. and its allies worldwide.”

The approach mirrors a seven-year deal Boeing struck in April to triple production of PAC-3 Missile Segment Enhancement seekers, part of a broader Pentagon effort to lock in supply from key subcontractors alongside the prime contractors.

Earlier this month, the Missile Defense Agency awarded Raytheon a $745 million contract to produce fully assembled SM-3 Block IIA interceptors for the United States and Japan.

Demand for the interceptor traces back to April 2024, when Navy destroyers first fired SM-3s in combat, helping to thwart an Iranian ballistic missile attack on Israel. Far more interceptors have been launched since, including those fired in Operation Epic Fury.

The Center for Strategic and International Studies estimated the SM-3 inventory at 414 as of December 2025. A May analysis from the center put wartime expenditures between 130 and 250 missiles and warned that replenishment will take years.

Congress has stepped in to keep the Block IB line open, the cheaper of the two variants covered by Friday’s agreements, after the Missile Defense Agency proposed ending new purchases in the fiscal 2025 budget request.

The announcement builds on an eventful few weeks for the company’s Corsair drone boats.

On July 12, three Corsairs struck Iran’s Bandar Abbas naval base in what U.S. Central Command called the first combat use of unmanned surface vessels by American forces.

Weeks earlier, a Navy-operated Corsair helped rescue two soldiers after their Army AH-64 Apache went down near the Strait of Hormuz, a mission Central Command called another first of its kind by an unmanned surface vessel.

Founded in 2022, Saronic first unveiled plans for Port Alpha in February 2025 but stopped short of naming a site or a cost. Plans now include an initial 835-acre site in Cameron County, with room to grow to nearly 4,400 acres. It’s an investment the company puts at more than $3 billion. The site was chosen over competing sites in California and Virginia, among others.

Construction is set to break ground this year, with the yard expected to open in 2028. Initially, the facility will be capable of building vessels up to 850 feet, about the length of a U.S. Navy Wasp-class amphibious assault ship, though future expansion could support vessels longer than 1,200 feet, the company said.

Saronic estimates Port Alpha could create up to 10,000 direct jobs over the next decade, from welding and machining to robotics, software engineering and naval architecture. The company also projects $264.5 billion in economic impact for Texas and $160 billion for Cameron County.

Texas Gov. Greg Abbott, who announced the project from Saronic’s Austin headquarters, said a fully built-out yard would deliver about $750 million a year in wages, a sum he called “game-changing for the population of Texas.”

To help land the project, the state extended an $80 million grant from the Texas Enterprise Fund, according to the governor’s office.

Last month, Cameron County commissioners approved a 95% tax abatement for the project over roughly two decades, according to USNI News. The agreement is contingent on Saronic filling 35% of the yard’s jobs with local residents, and the tax break shrinks if the company misses its local hiring targets, the Texas Tribune reported.

The deal was not without local opposition. According to the Border Chronicle, at least 40 people testified or submitted written statements against the abatement, some questioning why a company valued at $9.25 billion needed a tax break. The June 16 vote passed only after two earlier delays and hours of testimony.

Port Alpha would become Saronic’s third site. It runs a plant in central Texas that turns out the 24-foot Corsair, for which the Navy awarded a $392 million production contract in December, and last year it bought a former Gulf Craft yard in Franklin, Louisiana, where it is spending $300 million to build the larger, 180-foot Marauder.

Dino Mavrookas, Saronic’s co-founder and chief executive, did not specify which ships Port Alpha would build but told reporters the company envisions autonomy playing a role in larger hulls over time, according to USNI News.

“Those ships might not be fully autonomous or fully unmanned on day one,” he said. “But over time, as we look at building out the tech and building out the industry as a whole, there’s no reason that you can’t unman those ships completely.”

Port Alpha arrives amid a federal push to rebuild a U.S. shipbuilding base that has fallen far behind China’s. Saronic tied the project to an executive order on maritime dominance that President Donald Trump issued in April 2025, along with the SHIPS for America Act and a federal Maritime Action Plan, all aimed at reversing decades of decline in commercial and naval ship production.

“America’s maritime future depends on our ability to build again,” said Mavrookas, adding that the yard was built “to deliver ships at a speed and scale not seen since World War II.”

Saronic is one of seven companies competing for the Navy’s medium unmanned surface vessel contract, with at-sea testing set to run through October.

The company said it will work with Texas, Cameron County and local schools to build training and apprenticeship programs for the yard, but did not say when it expects to name customers or specific ship classes for Port Alpha.

The maneuver surfaced in a Wednesday report accompanying the House Appropriations Committee’s fiscal 2027 defense bill, and it runs on money the White House went looking for a week earlier.

In a June 17 budget amendment to House Speaker Mike Johnson, R-La., the Office of Management and Budget asked Congress to steer more than $1.55 billion into the Air Force’s research and development account to keep the airborne battle management jet alive — money the service had left out of its original request after the Pentagon moved to cancel the program just a year ago.

Getting there required two cuts and one deposit.

OMB carved about $651 million from the Navy account that buys the E-2D Hawkeye and $899 million from the Air Force’s other procurement account. It funneled the combined sum into Air Force research, development, test and evaluation.

The House report pins the Air Force half on the Special Update Program, one of the service’s classified procurement lines.

The justification ran identically across all three amendments: The money would “deliver two E-7 Wedgetail prototype aircraft and continue Engineering Manufacturing and Development activities for a program of record.”

The Air Force already has seven E-7s on contract, including two rapid prototypes and five more added under a March modification. However, all are developmental jets meant to prove out the U.S. design before any production decision, which is why the money lands in research and development rather than procurement.

The committee pointed to the war in Iran to make its case.

“The conflict in Iran has reinforced the need for the Air Force to maintain a credible airborne battle management capability, currently being met with the Air Force’s E–3 Airborne Warning and Control System and the Navy’s E–2D Hawkeye programs,” the committee wrote. “As the E–3 is set to retire, the E–7 Wedgetail will serve as modern replacement for lost battle management capability.”

Panel pushes back on taking Hawkeye money

The Hawkeye money, though, was not OMB’s to spend. The House panel backed the E-7 realignment but rejected the Navy offset, restoring the $651 million the White House had taken from the Hawkeye program.

“While the committee wholly supports the E–7 program and funding realignment, the Committee also restored the E–2D program to six aircraft for fiscal year 2027,” the report states. “The committee understands the operational necessity of the E–2D platform; the complementary nature of the E–2D and E–7; and believes that more aircraft, not fewer, are necessary to support our warfighters now and in the future.”

For all the money in motion, it buys prototypes and development work, not a Wedgetail fleet. Lawmakers want to know what comes next.

The report orders the Air Force secretary to brief the House and Senate defense appropriations subcommittees, alongside the 2028 request, on “the full E–7 acquisition strategy, to include required quantity; funding requirements across the future years defense program; and schedules for development and production.”

Prior to the war in Iran, the Air Force wanted to scrap the E-7 program, a platform already flying with Australia, the U.K. and other allies, after an Air Force official said its per-aircraft cost had climbed from $588 million to $724 million, and amid doubts about whether it could survive in contested airspace.

The previous plan was to lean on extra E-2Ds and a future of space-based sensors instead.

The war with Iran undercut that case, exposing a near-term battle management gap that satellites cannot yet fill, compelling the Pentagon to reverse course this spring.

Marine Corps Lt. Gen. Gregory Masiello, who took over the F-35 Joint Program Office last July, testified before an open session of the Airland Subcommittee as the program defends a fiscal 2027 request that bundles more than $13 billion for the jet in fiscal 2027 alone. The request includes a buy of 85 U.S. aircraft and full funding for the Block 4 modernization effort and the engine core upgrade.

This hearing marks the first time the F-35 program’s leader has appeared before the subcommittee since 2016. Since then, the fleet has grown from 170 aircraft to more than 1,300.

In his written testimony, Masiello pointed to a sustainment system that was originally built to support 700 to 800 aircraft, well short of the fleet now flying.

“If I have over 1,300 operational aircraft out there, I believe we have set and enabled a sustainment system for about 7 to 800,” he said. “So there is our challenge in readiness.”

The hearing comes on the heels of a Government Accountability Office report this month that found just one in four F-35s were fully mission capable (FMC), meaning able to fly all assigned missions. Overall mission capable rates of jets able to fly at least one mission fell from 67% in fiscal 2021 to 44%.

Masiello put the program’s mission capable rate at 56%, above GAO’s 44%, a gap he ascribed to methodology. He stopped short of contesting the GAO’s FMC figure, but emphasized that “context matters,” arguing the discrepancy results from how his program defines mission capable.

Partially dragging down the FMC rate is the acceptance of incomplete jets. Pressed by ranking member Sen. Mark Kelly, D-Ariz., Masiello confirmed the Marine Corps has accepted six F-35Bs with no radar installed, opting instead to wait for a newer APG-85 radar.

When Kelly asked whether an F-35 with no radar could be considered FMC, Masiello conceded, “I don’t think I would count them as fully mission capable,” adding that he would discuss the radar’s capability in more detail in the closed session that followed.

Masiello blamed years of underbuying spare parts as the fleet grew, not a broken system. In response, the program has launched what it calls the Global Support Solution Reset, a roughly $13.7 billion effort through 2031 that targets five problem areas including spares, depot capacity and maintenance plans.

“It’s not a systemic issue with the system having the ability,” he said. “It’s the fact that we didn’t put enough parts and pieces on the shelf, and we’ve increased the demand exponentially with the number of aircraft fielded, and we didn’t do the same thing with the spare parts and the system.”

Asked what is most responsible for keeping jets from FMC status, Masiello pointed to software issues and the jet’s canopies, whose limited lifespan he called a particular problem on a low-observable jet.

The modernization track is running behind as well. The full Block 4 suite, once due in 2026, is now years off. Masiello said the program has fielded 22 of 55 planned Block 4 capabilities, the suite of new sensors, electronic warfare and weapons meant to keep the jet ahead of modern air defenses. The program fielded seven of those in last year’s software upgrade, with another six due this summer.

Contributing to modernization delays are the jet’s power and cooling capabilities. The engine core upgrade, slated for fielding in 2031, is meant to power and cool the full Block 4 suite, whose new radar and sensors draw more power and generate more heat than the current jet can handle.

On program accountability, Masiello said in his written statement that the program would revise contracts to carry “meaningful incentives and penalties,” a change GAO has urged for years after finding the program paid Lockheed Martin millions in fees even as readiness slid.

But that isn’t GAO’s only recommendation. GAO has made 46 sustainment recommendations since 2014, including three in this month’s report. As of March, the Pentagon had implemented just 14, leaving most still open a decade later.

Asked by the committee’s newest member, Sen. Ashley Moody, R-Fla., how many of the GAO’s recommendations the program had closed, Masiello wouldn’t commit to a specific number, preferring to note that they were “probably all to some degree in process.”

Despite all the criticism, the jet’s unique capabilities drew high praise from across the aisle. Kelly, a Democrat and former Navy combat pilot, called himself and the committee strong supporters of the F-35 program.

Kelly recalled flying an F-16 against an F-35, noting that he “could not see it on radar even when I’m looking right at it.” But he tied that support to accountability, telling Masiello the program needs to show it can improve readiness and control costs.

Masiello made the same case from the program side, citing the jet’s prominent role in recent operations, including Epic Fury, the U.S. air campaign against Iran. He said operators had told him it was “the only aircraft that can hit some of the targets” those missions required and could “act as a quarterback of that joint force.”

The program’s global reach adds to the sustainment burden. Allied nations own and operate most of the F-35s based in Europe and the Pacific, and they keep buying more.

Masiello said Poland signaled plans to double its 32-jet order during his visit this month, though he had not yet seen a contract. That growing fleet draws on the same global spares pool and sustainment system now straining to keep U.S. jets ready, even as it spreads the program’s cost and industrial base across allied countries.

Masiello warned that funding only part of the fiscal 2027 request would slow the production line and cut deliveries. For now, the readiness fight, modernization and the sustainment reset all hinge on a budget Congress has yet to pass.

The mission capable rate, which measures the percentage of time aircraft can perform at least one of their tasked missions, dropped from 67% in fiscal 2021 to 44% in fiscal 2025, GAO found.

The full mission capable rate, the share of time aircraft can perform all assigned missions, slid from 38% to 25% over the same period.

Air Force officials attributed part of the fiscal 2025 drop to new jets that couldn’t perform their missions because of software delays, along with scarce parts and corrosion problems, according to the report.

“The F-35 is DOD’s most costly weapon system, but it hasn’t met performance goals and costs to sustain the aircraft continue to increase,” GAO wrote in a summary accompanying the report.

The F-35 Joint Program Office’s answer to the decline in readiness is what the office officially calls the Global Support Solution Reset. The strategy, launched in June 2025, aims for an 80% mission capable rate and a 65% full mission capable rate by 2030.

Getting there won’t come cheap: JPO estimates it will take $13.7 billion more than previously planned through fiscal 2031, money the services must request in their annual budgets.

The GSS Reset addresses concerns GAO has flagged for years, including spare parts shortages, maintenance problems and heavy contractor reliance, among other long-running issues.

Only about $2.2 billion of that total is for the GSS Reset, according to the report. The other roughly $11.5 billion covers the gap between what the services had budgeted and what F-35 sustainment actually requires.

JPO officials told GAO that readiness will likely worsen before it improves, and program documentation suggests improvements may not materialize until late 2026 or later.

GAO identified several risks that could keep the GSS Reset from succeeding.

“JPO will be reliant on the private sector to deliver more than $7 billion in additional parts and other material. But capacity constraints persist for key parts,” the report states.

A 2025 study by Lockheed Martin, which builds the F-35 and leads its sustainment alongside engine maker Pratt & Whitney, found 48 parts that the supplier base can’t produce enough of, including canopies, which GAO has previously identified as a top driver of grounded jets.

Costs keep climbing, too, threatening the services’ ability to pay for the Reset. By the mid-2030s, GAO projects the services will face a roughly $1.2 billion annual gap between what their F-35s cost to sustain and what they say they can afford.

Those estimates may understate the problem. GAO noted the fiscal 2027 projections were developed before Operation Epic Fury and may not capture the costs associated with additional flight hours.

Incentives spent on readiness haven’t delivered as intended, GAO found, echoing a Pentagon Inspector General audit published in December.

From 2020 through 2023, the program office paid Lockheed more than $114 million of roughly $269 million in available incentive fees meant to improve full mission capable rates and parts supply, even as both metrics generally stagnated or worsened.

Lockheed’s incentive fees were tied to readiness thresholds. In 19 of 39 performance periods, the JPO and Lockheed adjusted the recorded full mission capable rate upward, citing factors outside the company’s control, such as service-caused delays, which qualified the contractor for higher payments. Had fees been paid on the raw rates alone, GAO estimated Lockheed would have earned roughly half as much.

Pratt & Whitney, the program’s other prime contractor, has met its engine sustainment targets since 2022 after fixing problems GAO flagged in earlier reviews, the report noted.

“Lockheed Martin continues to partner with the Joint Program Office and our industry partners to ensure we are delivering efficient and effective sustainment for the warfighter,” a Lockheed Martin spokesperson said in a statement to Defense News. “We have recently invested more than $2 billion in advanced funding to accelerate spare parts to increase readiness rates across the F-35 fleet.”

The F-35 Joint Program Office concurs with the report’s findings and fully supports its three recommendations, a spokesperson told Defense News.

“Through our Global Support Solution Reset initiative, the JPO remains focused on achieving our 2030 readiness goals and ensuring strict fiscal accountability for every sustainment dollar spent,” the spokesperson said.

GAO also found the F-35 JPO could not produce consistent records of its incentive fee payments. It calculated fees using a formula that differed from the contract without documenting the change, and over the course of GAO’s review, provided three different versions of its incentive fee spreadsheet.

JPO officials told GAO they abandoned the contracted formula because it overstated Lockheed’s performance, and the corrected formula they used paid the company an estimated $3.7 million less than the flawed one would have.

GAO found the incentive problems extend to the current contract, covering 2025 through 2028, which includes no incentives tied to full mission capable rates at all, instead rewarding parts supply metrics with targets GAO found fall below the program’s own goals.

“Until JPO ensures the future use of incentives better achieves desired performance, it risks rewarding contractor performance that does not help meet program goals,” GAO stated.

GAO wants the Pentagon to do three things: build risk mitigation plans for efforts like the GSS Reset, covering technical data access, industry capacity, affordability and alignment with service goals; rethink how it structures contract incentives, possibly including penalties for poor performance; and build a reliable system for tracking what it pays in incentive fees and why.

GAO has now made 46 recommendations on F-35 sustainment since 2014. As of March 2026, the Pentagon had implemented 14.

The Pentagon did not provide formal comments on the report but said in draft comments that it agreed with the recommendations, according to GAO.

Despite the program’s readiness troubles, the F-35 remains the backbone of America’s fighter fleet. The Pentagon operates more than 800 of the jets and plans to buy about 1,700 more by the mid-2040s, with lifetime U.S. sustainment costs estimated at $1.6 trillion as of 2024.

The May 13 report, “U.S. Aircraft Combat Losses in Operation Epic Fury: Considerations for Congress,” draws on news accounts and statements by the Defense Department and U.S. Central Command to compile the list.

The CRS, the nonpartisan research arm of the Library of Congress, works from open sources and has no access to classified damage assessments.

The CRS authors note their count “may remain subject to revision due to multiple factors, which may include classification, ongoing combat activity, and attribution.”

The first losses came March 1-2, when a Kuwaiti Air Force F/A-18 Hornet mistakenly shot down three F-15E Strike Eagles over Kuwait. All six aircrew ejected and were recovered. The shoot-down occurred during active combat that included attacks from Iranian aircraft, ballistic missiles and drones, CENTCOM said.

A fourth F-15E was shot down over Iran on April 3, with both crew members recovered in separate search-and-rescue operations.

A KC-135 Stratotanker went down over western Iraq on March 12 during a refueling sortie, killing all six aircrew. The crew members are the only fatalities on the CRS list. The loss was not the result of hostile or friendly fire, CENTCOM said. A second KC-135 involved in the same incident landed safely at Ben Gurion Airport in Israel.

The toll on the tanker fleet grew two days later, when Iranian missiles and drones struck Prince Sultan Air Base, Saudi Arabia, damaging five more KC-135s on the ground and bringing total tanker losses to seven.

An F-35A Lightning II took Iranian ground fire over Iran on March 19 and returned to base.

Iran hit Prince Sultan again on March 27, damaging an E-3 Sentry airborne warning and control aircraft. A May 7 Washington Post report cited by CRS said the E-3 had been parked on an unprotected taxiway.

An A-10 Thunderbolt II went down April 3 after taking enemy fire during a search-and-rescue mission. The pilot ejected and was recovered.

Two days later, U.S. forces blew up two MC-130J Commando II special operations aircraft on the ground in Iran during the broader rescue effort for the downed F-15E weapon systems officer, after the transports couldn’t fly out of a forward airstrip. All aircrew were evacuated. An HH-60W Jolly Green II combat search-and-rescue helicopter took small-arms fire during the same mission.

Drones, meanwhile, took the heaviest hit, accounting for 25 of the 42 losses. The list includes 24 MQ-9 Reapers and one MQ-4C Triton lost in a mishap reported April 14.

Air Force Chief of Staff Gen. Kenneth Wilsbach told the House Armed Services Committee on May 20 that the Reaper had been the campaign’s standout platform despite the losses.

“Perhaps maybe the most valuable player was unmanned,” Wilsbach said. “No other platform is even close to the MQ-9.”

Notable gaps and omissions

Multiple outlets reported the E-3 was not just damaged but destroyed. Photos of tail 81-0005 published days after the March 27 strike showed the rear fuselage burned through, with debris scattered around the airframe.

The Jerusalem Post and Air & Space Forces Magazine both called the airframe a write-off. The Air Force operated only 16 E-3s before the war began, six of them deployed to Prince Sultan.

The HH-60W count is also likely low. At his April 6 news conference, Joint Chiefs Chairman Air Force Gen. Dan Caine described two helicopters in the rescue flight taking fire, with a crew member on the trailing aircraft suffering a minor injury. The Aviationist noted the account suggests both airframes were hit, not one.

The report does not list any AH/MH-6 Little Birds. Between two and four Little Birds operated by the U.S. Army’s 160th Special Operations Aviation Regiment were intentionally destroyed at the same Iranian airstrip where the two MC-130Js were demolished in place, The War Zone reported in early April, and photos geolocated by open-source analysts showed the burned-out helicopters next to the C-130 wreckage.

The 160th SOAR operates under U.S. Special Operations Command, and the absence of a DoD or CENTCOM statement on the Little Birds may explain why none appear in the CRS list.

Cost of war continues to climb

Acting Pentagon Comptroller Jules Hurst told the House Appropriations defense subcommittee on May 12 that the cost of operations in Iran has risen to $29 billion, up from the $25 billion figure he provided April 29.

“So, at the time of testimony from the ask, it was $25 billion, but the joint staff team and the comptroller team are constantly looking at that estimate, and so now we think it’s closer to $29 [billion],” Hurst told Rep. Pete Aguilar, D-Calif.

Hurst blamed the increase on “updated repair and replacement of equipment costs and also just general operational costs keep people in theater.”

The figure does not include the cost of repairing damaged air bases and other U.S. installations in the region.