Pete Hegseth Launches WWII-Inspired Defense Manufacturing Commission, Says Small Businesses Can Deliver ‘Generational’ Battlefield Advantage

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Defense Secretary Pete Hegseth and Small Business Administration chief Kelly Loeffler launched a new Smaller War Plants initiative modeled on the WWII-era Smaller War Plants Corporation on Tuesday, saying it will steer capital and expertise toward small defense manufacturers that can deliver what Hegseth called a "generational battlefield advantage."

Hegseth Targets Foreign Supply Chain Dependence

"Our message is clear: President Trump is ending the era of dependence on foreign supply chains and our adversaries," Hegseth said in a joint video. "When we back the businesses who supply our forces, we outbuild, out innovate and overwhelm any adversary."

Hegseth said the commission would turn "industrial capability into generational battlefield advantage" and help "deter conflict, preserve peace and ensure that no adversary tests American strength."

The initiative takes its name from the Smaller War Plants Corporation, which Congress created in 1942 under the War Production Board. National Archives records say the agency helped small businesses produce war material and essential civilian supplies through lending, contracts and technical assistance.

The Pentagon says roughly 70% of businesses in the defense industrial base are small firms, making them critical suppliers of components, specialized technology and manufacturing capacity.

Loeffler Promises Funding For Defense Suppliers

"Our joint mission will supercharge funding to those building our supply chain, tooling up, expanding, innovating and hiring to deliver capability to the warfighter," Loeffler said. "The era of offshoring the production of power projection to our adversaries is over."

The commission follows other efforts to expand domestic capacity. Earlier this month, the SBA launched a $20 million Critical Suppliers Prize Competition to help small businesses scale production at supply-chain chokepoints. It also awarded $50 million to technical schools and community colleges to train workers for small manufacturers.

Pentagon Pushes To Accelerate Weapons Production

Washington is simultaneously trying to accelerate weapons output. The Pentagon recently struck multi-year arrangements to boost production of SM-3 interceptor components.

The war on Iran has also sharpened concerns about U.S. interceptor inventories and manufacturing capacity. The administration has increasingly treated drones and other critical weapons as strategic products that should be manufactured domestically.

Loeffler said the goal is to pair "the world’s strongest military" with "the world’s most nimble industrial base," giving U.S. forces an "asymmetric advantage" while strengthening domestic jobs and supply chains.