Inside Iran's Wartime Defense Industry: Production Surges Amid US Economic and Military Pressure

The Iranian military is currently evaluating its response to newly planned economic measures from the United States aimed at causing the collapse of the government in Tehran. US President Donald Trump recently announced what he described as the 'most crushing economic operation' against Iran, warning of unprecedented economic warfare and isolation. In response, Iranian commanders are actively reviewing alternative military strategies.

'The only intelligent and effective solution to navigate difficult historical junctures and neutralise the enemy’s plots today and in the future,' Ahmad Vahdi, commander-in-chief of the Islamic Revolutionary Guard Corps (IRGC), stated on Friday. During the National Day of Defence Industry in Iran on Saturday, Ali Abdollahi, chief of staff of the armed forces, highlighted a 'deterrent defensive industrial revolution' concerning domestic weaponry. However, authorities decided against publicly exhibiting new arms, mirroring last year's approach.

Ministry of Defence spokesman Reza Talaei-Nik explained to state media that officials chose limited unveilings to surprise enemies and protect state defense secrets. Talaei-Nik claimed that in the year following the 12-day conflict with Israel and the US in June 2025, Iran doubled its production of weapons and defensive equipment. Following the outbreak of the current conflict with the US and Israel on February 28, the manufacturing of specific strategic products reportedly tripled.

According to Talaei-Nik, over 9,300 companies participate in Iran's weapons production, ensuring the sector cannot be entirely dismantled by US and Israeli strikes. Acting Defence Minister Majid Ebn-e Reza noted that armed forces achieved deeper penetrations of enemy bases, higher strike accuracy, and improved air defense interceptions compared to the previous conflict. IRGC spokesman Hossein Mohebbi added that future engagements will feature new generations of warheads for ballistic and cruise missiles.

A truce brokered between the US and Iran on April 8 followed nearly 40 days of intense bombardment and thousands of flight sorties. While the White House claimed that over 85 percent of Iran's defense-industrial base was destroyed—including most ballistic missiles, mobile launchers, and long-range drones—a confidential US intelligence report from May suggested Iran retained approximately 75 percent of its mobile launchers and 70 percent of pre-war missiles. Despite further bombardments in July, the IRGC and Iranian army continued launching drones and missiles toward US bases and international shipping routes in the Strait of Hormuz.

Experts note that Iran has sustained weapon manufacturing through geographically dispersed underground facilities safe from US bombs, even as surface factories suffered heavy damage. Alongside complex ballistic missiles, affordable explosive drones have successfully consumed US interceptor supplies, exposed radar positions, and disrupted shipping. Although US forces and allies increased energy transfers through the Strait of Hormuz, overall oil flows remain below pre-war levels due to ongoing drone and fast-boat attacks. With no meaningful diplomatic dialogue currently underway between Iran and the US, a peaceful resolution to the conflict remains elusive.