Overview
- In posts on Truth Social, the president said defense firms will be barred from dividends and stock buybacks and that executive compensation should be capped at $5 million until production and maintenance improve.
- He urged companies to redirect cash to new and modern plants and warned that Raytheon/RTX was the least responsive to Pentagon needs, threatening future business if it does not change course.
- Shares of Lockheed Martin, Northrop Grumman, General Dynamics, RTX and others fell sharply after the remarks before rebounding in after-hours trading when he proposed a $1.5 trillion defense budget for 2027.
- Defense Secretary Pete Hegseth signaled support for a production‑first push, while reporting pointed to internal debate and noted that an executive order is being considered but not finalized.
- The push follows years of delays and overruns flagged by the GAO on programs like the F‑35 and Sentinel, even as major contractors have returned billions through dividends and buybacks.