Pentagon War Game Exposed a Critical US Aluminum Risk Months Before Iran Attacks

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The war game was part of a broader effort to identify strategic dependencies. That’s an area where Washington has made far more progress diagnosing the problem than fixing it, according to Michael O’Hanlon, the Philip H. Knight Chair in defense and strategy at the Brookings Institution, a Washington think tank.

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The Pentagon frequently lacks information about subcontractors who are multiple steps removed from prime Defense Department contractors like Lockheed Martin, meaning dependencies become fully apparent only after a disruption occurs, according to O’Hanlon. Though the president can invoke the Defense Production Act — a federal law that grants emergency powers to control domestic industries — to prioritize the use of aluminum for the military, that would mean less supply for civilian consumption.

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“If you start prioritizing for the military, then you’re going to deprioritize for somebody else,” O’Hanlon said.

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As part of an effort led by Deputy Secretary of Defense Stephen Feinberg, the Pentagon has been working to gain better visibility into its supply chain, including for sub-tier suppliers many rungs below the primary contractors.

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Treasury Secretary Scott Bessent in late June called for assessing supply-chain vulnerabilities across various industries and expanding domestic capacity to ensure the US is never at the mercy of foreign chokepoints.The Defense Department’s war game “makes clear that America’s military readiness is inseparable from America’s industrial readiness,” Charles Johnson, chief executive officer of the Aluminum Association industry group, said in an emailed statement. 

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Johnson said the Aluminum Association is urging the Senate to advance the provisions in the House-passed National Defense Authorization Act that would strengthen the US domestic aluminum supply chain. The legislation would direct the Defense Department to submit a report to Congress on the supply chain, including an analysis of opportunities to increase aluminum production in the US.

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Falling Short

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US policy efforts have so far fallen short, however.

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In the clearest acknowledgment yet that President Donald Trump 50% tariffs on foreign aluminum haven’t boosted domestic manufacturing as intended, his administration recently unveiled an incentive program aimed at bringing aluminum smelting back to the US. The plan offers to halve duties on imports of the metal for companies building domestic plants.

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Despite “the benefits from the aluminum tariff regime, the domestic production and supply of primary aluminum, which is critical to the US economy and defense industrial base, is still in insufficient supply,” according to a White House proclamation. 

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Trump’s tariffs have also hindered domestic stockpiling of aluminum. That’s because they’ve helped drive up US prices, forcing manufacturers to buy only what they need as costs rise. 

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The Pentagon’s Defense Logistics Agency has sought to procure high-purity aluminum on its own. Last year, it put out a tender seeking a contractor to provide the metal, with a stringent requirement: The material had to come from a US supplier. That’s a common provision in Defense Department contracts.

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The agency later withdrew the tender without explanation. While Arconic makes the ultra-refined metal at its plant in Davenport, Iowa, the facility uses feedstock that’s partly imported. And the output is on a small scale and is only for the company’s internal consumption. 

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Artificial intelligence is a growing threat to US aluminum manufacturing, albeit an indirect one. Aluminum production, among the most energy-intensive industries, is struggling to compete with power-hungry data centers for cheap electricity.