DUBAI, United Arab Emirates — For years, US industry figures have warned for years that American military goods could be supplanted by cheaper, faster competitors.

But at the Dubai Airshow in November,this month, the threat suddenly took on greater urgency, with industry and government officials alike telling Defense News that Gulf partners are seriously threatening to look elsewhere for key military technologies.

Driving the demands from Gulf partners: ongoing operations in Yemen and Syria that are wearing down older systems and revealing capability gaps that need to be plugged quickly. And the US process, partners are saying, is not moving fast enough.

"The frustration level in this region, that we hear from our customers, is that 'we want your product, we want to work with the US, but I don't know how long I can wait,'" said one senior industry executive at the show. "They are sovereign nations and they see the threats and they feel like they need to beef up their defenses.

"So when they ask for something and we can't give them a definite timeline, they have no alternative but to start going elsewhere."

Industry is pointing fingers at the speed of the Foreign Military Sales (FMS) process — hardly a new complaint, but one which is taking on greater urgency than before.

The FMS system requires sign-off from the Department of Defense, Department of State and Congress before a weapon sale can be cleared. And while countries like to complain about the process, they certainly have not stopped buying US goods.

Defense Security Cooperation Agency (DSCA) director Vice Adm. Joseph Rixey said in October that 2015 was the agency's biggest year yet, outside of a 2012 boost from F-15 fighter jet sales to Saudi Arabia. DSCA processed $34.2 billion in sales in 2014, and $27.8 in 2013.

Given those figures, concerns that the US may lose out on sales seem more alarmist. than anything. But a series of interviews conducted on the ground in Dubai found very real concern, with a different tone than the usual litany from industry that has obvious self interest in being able to open the sales floodgates.

Remy Nathan, vice president for international affairs with the Aerospace Industries Association (AIA), said he has "always intellectually been concerned about the notion that people will look for alternatives to American solutions," but that this was the first show where those concerns appear to be widespread.

AIA acted as a center for meetings between the US government and American industry at the Dubai airshow, and so Nathan was privy to a number of high-level discussions. And those discussion revealed that industry is feeling the heat from nations like Russia and China when it comes to unmanned system sales in the Gulf, and Europe when it comes to high-end systems like fighters.

"What this show is telling me, what I'm hearing from a bunch of our executives, is, the pitch from the foreign competitor hasn't changed," Nathan said. "But now that the pressure of time, with the pressure of need, it's starting to actually resonate a bit more. We're not changing our message and our approach and our orientation to the partner, and the other guy's pitch is starting to sound better and better."

Need for Speed

That pitch — that the US is too slow, and that other nations can provide cheaper alternatives at a much more rapid pace — is taking hold in a region that has seen sustained military operations for over a year, with the US-led coalition in Syria and the Saudi-led coalition in Yemen.

Concerns over the speed of the FMS process were made abundantly clear to US Air Force officials at the show, including service Secretary Deborah Lee James and service acquisition head Bill LaPlante.

"I heard, and so did the secretary, an earful both from industry and partners and allies that whatever we can do back here in Washington to make the process faster, let's redouble our efforts," LaPlante told Defense News.

LaPlante said he heard from allied nations that want ISR, command and control, and capability upgrades for high-end technology such as the F-15 and F-16s. There is also strong demand for munitions, something Secretary James identified as a pressing concern at the show, and one driven by the ongoing operations.

"They are in the current fight, not just in ISIL and al-Qaida but also the situation in Yemen, very urgent," LaPlante added. "Across the board, there is just a very, very high demand — signal and speed is critical."

Nathan anecdotally told the story of one US executive who was flatly told by a Gulf nation that they were not being allowed to compete for a program because the US system moves too slowly for their needs.

Another anecdote, told by Textron Systems CEO Ellen Lord, involves a US diplomat being told by a Gulf partner that they were considering buying Chinese unmanned systems over US ones.

"They are turning to far inferior products from China because they can buy roughly 10ten times the number of systems from China for the same price they can from the US," Lord said. "They know eight out of 10ten of those will probably crash very quickly, but they are still left with two. So that's where speed versus capability" comes in.

Lord then added that she sees the biggest competition in the region, at least for unmanned systems, as coming from China.

"The point I make constantly is it's a 30- to 40-year relationship," the industry executive said. "If in one moment in the next six months one of these countries says 'I can't wait any longer … we've lost them for 30 years."

Not everyone is concerned, however. Scott Nathan, State Department special representative for commercial and business affairs — the highest ranking State official at the show — acknowledged industry complaints, but noted that it's in industry's interest to ring alarm bells.

"It is of course a concern if it is a concern for business, and as importantly or maybe more importantly, for our customers, for our partners abroad," he told Defense News at the show. "They have capabilities they are looking for and I can understand why they would like to get an answer."

But, he noted, "it's industry's job to press." And while there is always room for improvement, he expressed satisfaction with the current FMS system.

"We have a process to undertake," he said. "We're focused on making sure we get the right outcome and we make sure we do that as efficiently as possible, and I happen to think we're doing a good job out of that."

The complaints about the FMS process have ricocheted back to the US, as well. A senior Hill staffer expressed dismay that the State Department is not concerned about losing market share to competitors in the region.

"It's not a consideration of theirs. At what point do we lose our ability to put our stamp on the region? How do you motivate or move a process that has no concern with marketshare?"

Regional Tensions

Undergirding some of the tension over the speed of the FMS process: regional politics regarding the Iran deal.

When US President Barack Obama met with Gulf Cooperation Council (GCC) leaders at Camp David earlier this year to assuage concerns over Iran, one of the deliverables was that the US would start "streamlining the process for arms sales," said Rebecca Wasser of the Rand Corp.

"The administration has decided to use arms sales as a way of saying 'we understand you have concerns and fears [post Iran deal], here's something we can do that is quite tangible,'" Wasser said. But "many within Gulf establishments note that the deliverables from Camp David are moving very slowly … they haven't really seen a lot of results which has led to some frustration and renewed concerns about the US commitment to their security. I would not be surprised if these sales are a part of that because they take so long."

Wasser does note that there have been almost $20 billion in arms sales to the Gulf since the Iran deal was struck, but almost $19 billion of that has gone to Saudi Arabia.

Concerns from GCC nations are balanced out by concerns that Israel's military edge could be dissolved, which the industry executive believes is causing Congress to slow down deals.

"The political spectrum of everything from Iraq, Afghanistan, Syria, Libya, ISIS, the Iran deal — you add all that together, and Congress is more focused and interested in understanding what's going where," the industry executive said. "Our friends in Israel are concerned about what's going when and where. The US has to balance all that."

The question now is whether Gulf nations, annoyed by the deliberate pace of the FMS system, will look elsewhere in the near term.

AIA's Nathan said he had heard concerns that the next six to 12twelve months could be pivotal for US sales to the region, with the Gulf nations anxious to replace used up capability.

Asked whether industry was warning of a breaking point, coming, LaPlante said, "I heard a little bit of that as well, but I hope that's not the case."

"I think there are people working very, very hard to try and get capabilities to [the partners]," LaPlante added. "Industry, by expressing what you heard, is just showing their unease because they are concerned that they'll lose the business."


Twitter: @AaronMehta

Aaron Mehta was deputy editor and senior Pentagon correspondent for Defense News, covering policy, strategy and acquisition at the highest levels of the Defense Department and its international partners.

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