US defense investment gap reflects market barriers and shortage of investable opportunity, not any shortage of capital--Bain & Company and AIA report
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BOSTON and ARLINGTON, Va., Sept. 28, 2026 /PRNewswire/ -- The US has no shortage of capital for defense but confronts systemic risks to replenishing stockpiles and adopting disruptive technology because of a shortage of investable opportunities, Bain & Company and the Aerospace Industries Association (AIA) conclude in a major new analysis released today. While private investor interest in defense has surged in recent years, the Bain/AIA study, The State of Investment in Defense: Unlocking Growth, finds that market conditions are inhibiting capital from flowing to critical bottlenecks in the industrial base. (See also: Full Report in PDF; Executive Summary .) The Bain/AIA report identifies persistent barriers that constrain investment in US defense R&D, production capacity, critical inputs, component manufacturing from mid-tier suppliers, and emerging technologies, in findings that draw on 50 stakeholder interviews conducted between April and August 2026 with prime integrators, new defense market entrants, suppliers, investors, and industry thought leaders. "Existing investment and business models aren't sufficient in this new environment," said Michael Sion, partner in Bain & Company's Aerospace and Defense practice. "Private defense investment growth of all kinds is required to address capacity and innovation constraints that are risks to national security. There is ample...
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