China has raised its missile production to a historic level in 2025, according to a financial survey by Bloomberg. Relying on a network of private civilian and military suppliers, Xi Jinping aims to modernize his army as the centenary approaches in 2027. And to safeguard Taiwan against the unpredictable American power.
Winter 1979. That year, China clashed with Vietnam. After a month of conflict, Chinese troops withdrew. They have not been involved in any war since that date. However, the Middle Kingdom has continued to strengthen its military arsenal.
Beijing’s defense industry apparatus, according to a financial mapping by Bloomberg, reached an unprecedented peak of activity in 2025 since Xi Jinping came to power in 2013. By examining the annual reports of 81 publicly traded companies providing essential missile components to the two state giants, CASIC (China Aerospace Science and Industry Corporation) and China Aerospace Science and Technology Corporation (CASC), the study shows that the number of companies involved in the supply chain more than doubled in a decade.
This rise in power is reflected in exceptional financial results that contrast with the relative gloom of the rest of the Chinese economy. In 2025, the combined revenue of these suppliers jumped 20% to 189 billion yuan, or about 24 billion euros, according to the American media. Nearly 40% of these companies recorded their best sales since 2013, a performance all the more notable as, during the same period, the country’s 300 largest market capitalizations showed significantly more modest growth.
When medical companies convert to armaments
One key to this acceleration lies in the increasing integration of private technology companies into the military-industrial complex. As drivers of the Chinese missile program, CASIC and CASC receive orders from the army and redistribute them to a network of smaller suppliers.
A company like Wuhan Guide Infrared, originally specialized in thermal sensors for healthcare, now derives over 70% of its revenue from the defense sector. Its conversion to essential infrared guidance systems for cruise missiles and drones even led to the sanction of one of its subsidiaries by the United States and the European Union, the media reports. This did not prevent its turnover from jumping by 73% last year.
Other niche players also see their order books skyrocket. Chengdu Jiachi Electronic, a leader in stealth coatings designed to make missiles and aircraft invisible to radar, saw its revenue increase by 16% in a year. Similarly, Yangtze Optical Electronic, a supplier of fiber optic spools for the precision navigation systems of ballistic missiles, now does 70% of its business with the military, and its sales increased by 20% last year.
A message to the Americans
This frenzy of production is aimed at saturating enemy defenses in the event of conflict in the Indo-Pacific region. According to the Pentagon, the Chinese arsenal had over 3,150 ballistic missiles in 2024, an astonishing 147% increase from 2015. Beijing now has weapons capable of hitting almost any point on the globe, such as the intercontinental DF-41 missile or the “Guam Express” (DF-26), specifically designed to target American bases in the Pacific.
“Recent events have likely accentuated the perceived need to defend and deter any potential American military or political action against Taiwan,” explains John Van Oudenaren to Bloomberg.
This analyst at BluePath Labs specializes in Chinese missile giants owned by the state. Capture of Nicolás Maduro, attack on Iran… Policymakers in Beijing “clearly feel the need to react.”
While American ammunition stocks are being put to the test by tensions in the Middle East, Beijing is taking advantage of its massive manufacturing capacity to gain the upper hand. For the centenary of the People’s Liberation Army in 2027, Xi Jinping aims to equip China with a modern army capable of deterring any American intervention concerning Taiwan.
Despite corruption probes that recently targeted several high-ranking officials and scientists in the sector, the momentum does not seem to be slowing down. First-quarter 2026 data confirms the trend with a further 20% increase in revenue for missile suppliers.
