The Pentagon's 'Last Supper' and the era of aerospace consolidation
In 1993, US defense officials invited industry executives to a meeting known as the 'Last Supper.' The message was clear: there were too many suppliers. This sparked a massive wave of mergers that transformed a fragmented landscape into a world of massive, dominant giants.
The modern aerospace landscape is defined by intense consolidation. In the early 1990s, US Secretary of Defense Les Aspin and deputy William J. Perry hosted the 'Last Supper' at the Pentagon, informing contractors that the number of military suppliers was far too high. This directive triggered a period of massive industry shifts; between 1992 and 1997 alone, $55 billion in military-industry mergers occurred, leaving a concentrated field of major players including Boeing, Lockheed Martin, Northrop Grumman, and Raytheon.
This trend of consolidation is not limited to defense. Between 1988 and 2010, the global industry saw more than 5,452 mergers and acquisitions, with a known total value of US$579 billion. Notable examples include Boeing's $13.3 billion acquisition of McDonnell Douglas in 1996, and Raytheon's $9.5 billion purchase of Hughes Aircraft Company in 1997. More recently, in 2017, United Technologies acquired Rockwell Collins for $23 billion, a move that eventually contributed to the formation of Raytheon Technologies Corporation in 2020.
The structure of manufacturing has also evolved from vertical integration to complex global supply chains. Before the 1980s and 1990s, manufacturers typically handled most processes in-house. Today, the industry often uses a 'Tier 1' model, pioneered by the Bombardier Global Express. In this system, risk-sharing partners fund roughly half of development costs. This interconnected web allows the global industry—valued at $838.5 billion in 2017—to manage everything from massive airliners to satellites and UAVs.
Source: Aerospace manufacturer
