U.S. Army contracting is not on hold, according to a statement from the Defense Department issued on Tuesday. This statement was made to address confusion generated by an email guidance that circulated prior to an anticipated administration memo aimed at aligning all “financial assistance” with recent executive orders from the Trump administration.
The memo, released on Monday by the Office of Management and Budget, does not extend to general contracting practices, as clarified by the Pentagon on Tuesday evening. A senior defense official, who spoke on the condition of anonymity, stated, “While we are not aware of any specific contracts or other activities affected, it is possible that activities may be paused if they are determined to fall within the bounds of the guidance.”
The situation escalated following a report on Monday by Bloomberg Government, which indicated that Defense Secretary Pete Hegseth had ordered a review of all ongoing Army contracts and future requests for proposals. This review seeks to remove requirements related to diversity, equity, and inclusion, in accordance with an executive order signed immediately after Trump’s inauguration. A follow-up article by Breaking Defense described the turmoil and uncertainty within the defense industry that arose due to the Army’s guidance.
An email, shared with Defense One, was sent on Department of the Army letterhead to “industry partners.” It stated that Army Contracting Command – Detroit Arsenal had received guidance instructing an immediate halt on all new solicitations and contract awards.
In response to these developments, the Army has issued a statement indicating that it is reviewing all pending contract awards and solicitations to ensure alignment with incoming leadership’s policies and directives. Meanwhile, other military branches have not issued similar guidance; officials close to the Marine Corps acquisitions stated they had not received instructions but were monitoring the potential impact of the Army’s pause.
The news of the purported pause reached industry leaders at the AFCEA West conference in San Diego. Chris Brose, chief strategy officer at Anduril, expressed that a temporary pause by the new administration could be a prudent step to assess the current contracting landscape before proceeding with additional expenditures.
