Reuters: Saudi Arabia, US in Talks on Billions in Arms Sales

Washington is working to push through contracts for tens of billions of dollars in arms sales to Saudi Arabia, some new, others in the pipeline, ahead of U.S. President Donald Trump’s trip to the kingdom this month, people familiar with the talks told Reuters this week.

Saudi Arabia is Trump’s first stop on his maiden international trip, a sign of his intent to reinforce ties with a top regional ally.

The United States has been the main supplier for most Saudi military needs, from F-15 fighter jets to command and control systems worth tens of billions of dollars in recent years. Trump has vowed to stimulate the US economy by boosting manufacturing jobs.

Lockheed Martin Co (LMT.N) programs in the package include a Terminal High Altitude Area Defense (THAAD) missile defense system with several batteries, the sources said.

The THAAD system, like the one being made operational in South Korea, costs about $1 billion. Also being negotiated is a C2BMC software system for battle command and control and communications as well as a package of satellite capabilities, both provided by Lockheed.

Combat vehicles made by BAE Systems PLC (BAES.L), including the Bradley Fighting Vehicle and M109 artillery vehicle, are also under consideration as part of the Saudi package, people familiar with the talks said. Both vehicles are in the Saudi inventory. British defense company BAE has 29,000 employees in the United States.

Reuters said the sources spoke on condition of anonymity because they were not authorized to discuss the negotiations, which also include previously reported contracts or items under discussion for years. One such deal, an $11.5 billion package of four multi-mission surface combatant ships and accompanying services and spares, was approved by the State Department in 2015. Talks followed to hammer out capabilities, configuration and design for the complex warships but the deal has never gone to final contract.