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Today, we’re looking at what Elon Musk’s jab at the F-35 says about the debate over using manned fighters or drones in warfare.
What’s on deck:
But first, we’re in a dogfight.
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The big story
Pilot ejection
F-35s are typically acquiring targets. Now they’re finding themselves in the crosshairs.
The fighter jet was the butt of Elon Musk’s joke on X about the declining relevancy of manned jets with the rise of drone tech, write Business Insider’s Matthew Loh and Mia Jankowicz.
The billionaire criticized the “idiots” still building aircraft like the F-35, and said using crewed jets to extend the range of missiles or drop bombs was “inefficient” compared to “a reusable drone.”
In the past, Musk’s jabs on X might have ended there. Now, his status as the co-lead of President-elect Donald Trump’s new Department of Government Efficiency puts the comment in a different light.
With promises of cutting trillions of dollars in government spending, DOGE will need to swing big. And the F-35 program, which is expected to cost more than $2 trillion over its entire lifespan and has a history of maintenance issues, could be a massive target for Musk.
The market took notice, as shares of Lockheed Martin, the F-35’s lead manufacturer, dropped 3.75% yesterday. The S&P 500 Aerospace & Defense index finished Monday down more than 1%. (Reports of a potential Israel-Hezbollah cease-fire deal also pulled down the sector.)
Musk didn’t specify plans to go after the F-35 or other crewed aircraft via DOGE, but an op-ed he wrote with co-lead Vivek Ramaswamy mentioned the Defense Department’s $841 billion budget.
Ending support for crewed jets in favor of drones won’t be easy.
Drone usage in combat is on the rise, as is evident in the Ukraine war, and offers benefits around cost. But in situations where air and sea combat are more prevalent, like the all-important Indo-Pacific theater, the tech isn’t as good of a fit, write BI’s Ryan Pickrell and Mia.
The jet-drone debate is a microcosm of the type of battles DOGE will likely encounter in its quest to slim down a government that spent $6.75 trillion in fiscal year 2024.
A fresh set of eyes can often find issues overlooked by those in the thick of it. And Musk has a history of doing what others thought was impossible. SpaceX’s progress in returning its Super Heavy booster to its launch site is a good example.
The public and private sector are two very different animals, though.
Even with a Republican-controlled Congress, the government’s checks and balances might make it harder to make the type of wholesale changes Musk is known for with his companies.
News brief
Top headlines
3 things in markets
- Trump announced sweeping tariffs on the US’s closest neighbors. The president-elect said he’ll impose a 25% tariff on all goods from Canada and Mexico. In a Truth Social post on Monday, he accused the two countries of failing to prevent migrants from entering the US. He wrote that both countries will “pay a very big price,” and that the tariffs would remain until they “solve this long simmering problem.” In a separate post on Truth Social, Trump said he plans to slap an additional 10% levy on Chinese goods. He had previously announced a 60% import tariff on China, which could hit its fast-fashion brands hard.
- How the Treasury secretary pick thinks about investing. A 2017 presentation from Key Square Capital, Scott Bessent’s macro hedge fund, offers some clues to his approach to finding investment ideas. The seven-year-old presentation said there is no “singular framework” for evaluating potential investments and the “guiding research principle is change.”
- Warren Buffett offered advice about estate planning. The legendary investor sent a letter to Berkshire Hathaway shareholders about his plans to donate $1.2 billion to family foundations. He also shared updates on how his massive wealth will be distributed after he’s gone and why parents should have their kids read their wills before they die.
3 things in tech
- Google kept tabs on Apple’s ad business way before it really got started. A 2022 document unearthed in Google’s ongoing antitrust case shows how Google strategists imagined Apple’s entry into the industry it’s dominated for years. Titled “Operation Black Walnut,” it assesses Apple’s potential and imagines an ad business its competitor might someday build.
- Zoom goes camera off. The company best known for its videoconferencing software, had dropped video from its name. Zoom is taking an AI-first approach to corporate communications, CEO Eric Yuan wrote in a company blog post published Monday. In a major rebrand, it will now be known as “Zoom Communications Inc,” and it’s not the only company adapting its marketing strategy to the industry-wide AI boom.
- Hybrid cars are so back. As EV sales hit a snag this year, automakers turned toward hybrid models, which are more practical and affordable than charge-only EVs. In the coming years, you can expect a greater menu of green vehicles on dealer lots.
3 things in business
- Inside America’s love affair with Aldi. Grocery prices have jumped by double-digits over the past few years, and Americans are feeling the sting. But the grocery chain Aldi has remained a safe space. Through a number of cost-cutting strategies, it’s managed to maintain lower prices than its competitors and built a dedicated fan following.
- The chatbots aren’t alright. By corporate America’s telling, AI is the answer to everything. Yet for many consumers, dealing with a robot customer-service agent actually makes the whole experience worse. Why are so many companies relying on inefficient AI — and will they ever improve?
- Macy’s missing millions. The department-store giant delayed its earnings report after discovering a single employee deliberately made an accounting error totaling between $132 million and $154 million. One former KPMG manager told BI that even in a situation where someone intentionally introduces errors, “your system of internal control should have caught it.”
What’s happening today
- Court hearing in the Justice Department’s antitrust suit against Google, which it accuses of illegally maintaining a monopoly on search.
- Federal Open Market Committee meeting minutes are published.
The Insider Today team: Dan DeFrancesco, deputy editor and anchor, in New York. Grace Lett, editor, in Chicago. Ella Hopkins, associate editor, in London. Amanda Yen, fellow, in New York. Jack Sommers, deputy editor, in London.Milan Sehmbi, fellow, in London.
