August 14, 2020 | International, Land

AM General CEO on acquisition by a private equity firm

WASHINGTON ― KPS Capital Partners is acquiring Humvee-maker AM General, the private equity firm announced last month, marking a new chapter for the South Bend, Indiana-based vehicle maker.

AM General President and CEO Andy Hove will continue to lead the company, and KPS Partner Jay Bernstein said the firm would continue to build on the ubiquitous Humvee, leveraging the company's “research, technology, innovation and new product development, as well as its heritage and iconic brand name.”

The Humvee appears to have some growth ahead. For one, U.S. Army budget documents call for $1.5 billion through 2025 to pay for modernization of its fleet of High Mobility Multipurpose Wheeled Vehicles and their up-armored variant. That can include replacing major components, applying new technologies or replacing vehicles entirely. After the Army reaches its procurement objective for the Joint Light Tactical Vehicle, made by Oshkosh, it will have an enduring requirement for 54,800 Humvees.

Otherwise, AM General ― which has advertised both its Brutus 155mm and Hawkeye 105mm mobile howitzers ― is expected to participate in the Army's mobile howitzer shoot-off evaluation at Yuma Proving Ground, Arizona, next year.

Meanwhile, the Army is expected to complete a new tactical wheeled vehicle strategy in fiscal 2021, which has thus far received congressional support, per the House and Senate versions of the annual defense policy bill.

Hove, who has said KPS will continue to execute AM General's existing strategy, spoke with Defense News on Aug. 6. This interview has been edited for brevity and clarity.

Private equity firm KPS Capital Partners is in the process of acquiring AM General. At this preliminary stage, what would you say are KPS' plans and vision for the company?

I think [KPS partner] Jay Bernstein represented it in his quote in the announcement that they feel really good about the capabilities of AM General and the strategy we've been executing. We've discussed with them where we can go. They're confident in our business and the growth prospects of AM General. They feel good about and stand behind our strategy, and we're going to work together with them.

Will the company focus more on the Humvee, or do you see it becoming more flexible? What is the future for the Humvee? Who are its customers these days?

To say we're only focused on the Humvee today would not be a correct premise. We've made investments across the board, in base automotive systems, and then automotive systems that have a particular special use. Our core focus is in solving very complex mobility challenges for customers. So the Humvee has a great future. I would offer that you turn to not what I say about what the Army will do but what the Army says they're going to do on the Humvee fleet, which is to steadily and systematically manage a very large fleet by systematic replacement of that fleet and recapitalization of that fleet going forward.

They've been buying new-built Humvees to replace old Humvees over the last four years at a pretty heavy clip and have announced their intention to continue to do that going forward.

We're obviously going to focus on the Humvee because there's significant demand. It is today the world's leading military 4x4 in its class, and we build more of them than any other military vehicle manufacturer in the world, and especially more than anybody in our weight class.

That won't be the only thing we invest in. You can see our investments in the Hawkeye, which brings game-changing breakthrough technology [in relation to] how artillery systems are moved around and employed on the battlefield, together with a whole other range of implementing technologies such as autonomous navigation, off-board power and those kind of things. The U.S. Defense Department is an important customer, but a considerable portion of our businesses is global business, so we take a global view of how we solve mobility challenges for our customers around the globe.

The Army recently issued a request for information about replacing heavy trucks. Is that a potential opportunity?

We certainly feel like we have something to offer, a range of things to offer there, and that RFI's only been out for a couple of weeks. We'll will certainly take a closer look at that. We're also taking a look at the JLTV competition they announced back in February.

Defense News recently characterized AM General as “largely stagnant” since losing the competition for the JLTV in 2015 to Oshkosh. Do you want to push back at all to talk about AM General's time under McAndrew & Forbes?

The JLTV decision was 2015, and the four years since the announcement on the JLTV competition we've built more military vehicles than Oshkosh or any other military vehicle manufacturer by a long shot, and sold them to more customers around the globe than anyone else. I think that's far from being stagnant. There are a lot of adjectives you can apply to the company. “Stagnant” would not be the one I would apply.

Private equity firms will typically set up companies they buy for faster growth, and then potentially that'll lead to a future sale. Do you think that's something that might happen here, and what do you predict? Is there any indication of time horizons for KPS?

KPS has made a lot of smart investments, they have a pattern, but they're not going to be pigeonholed into a particular time frame for a next-step strategy.

https://www.defensenews.com/interviews/2020/08/13/am-general-ceo-on-acquisition-by-a-private-equity-firm/

On the same subject

September 10, 2019 | International, Aerospace, Naval, Land, C4ISR, Security

Contract Awards by US Department of Defense - September 09, 2019
AIR FORCE Solid State Scientific Corp., Hollis, New Hampshire, has been awarded a $59,000,000 firm-fixed-price and cost-plus-fixed-fee hybrid contract for Air Force Weather Enterprise (AFW) Product-as-a-Service/Infrastructure-as-a-Service. This contract provides the migration to the cloud for the Air Force Weather Branch and is to design and build an Air Force Weather Virtual Private Cloud. It is required to expand to support the cloud migration and operations for all AFW applications. Work will be performed at and is expected to be completed by May 9, 2020, with two one-year options. This sole source award is a result of a Small Business Innovative Research Phase III follow-on. Fiscal 2019 operations and maintenance funds in the amount of $777,351 are being obligated at the time of award. The Aerospace Management Systems Division, Hanscom Air Force Base, Massachusetts, is the contracting activity (FA8730-19-C-0041). BlackHorse Solutions Inc.,* Herndon, Virginia, has been awarded a $48,843,831 cost-plus-fixed-fee contract for CDI2E software/hardware prototypes. This contract will advance global vigilance, global reach, and global power in the information environment through the application, research, development, and transition of emerging technologies and next-gen solutions. This includes rapid tool development, development of electronic warfare/cyber network attack software and hardware systems, analytical processing, cyber threat avoidance and cyber threat defense, test and evaluation, and to manage the development to ensure projects move forward at a rapid pace, that technical and process innovations incorporated into successive rounds of development. Work will be performed at Herndon, Virginia, and is expected to be completed by Sept. 9, 2024. This award is the result of a competitive acquisition and two offers were received. Fiscal 2019 research, development, test and evaluation funds in the amount of $300,000 are being obligated at time of award. The Air Force Research Laboratory, Rome, New York, is the contracting activity. (FA8750-19-C-1528). ECSC LLC, Columbus, Mississippi, has been awarded a $45,000,000 indefinite-delivery/indefinite-quantity contract for Columbus Air Force Base paving and civil works. This contract provides for repair and construction of asphalt and concrete pavements including sub-base and base course, installation of associated utilities, drainage structures, sidewalks, curb and gutters, rubber removal and painting of runways, taxiways, and aprons, and turf. Work will be performed at Columbus Air Force Base, Mississippi and Auxiliary Field, Shuqualak, Mississippi, and is expected to be complete by Aug. 31, 2026. This award is the result of a competitive acquisition and two offers were received. Fiscal 2019 operations and maintenance funds in the amount of $621,000 are being obligated at the time of award. The 14th Contracting Squadron, Columbus Air Force Base, Mississippi, is the contracting activity (FA302219-D-A002). ajc architects, Salt Lake City, Utah (FA8201-19-D-A003); Architectural Nexus, Salt Lake City, Utah (FA8201-19-D-A005); CRSA, Salt Lake City, Utah (FA8201-19-D-A008); Design West Architects, Salt Lake City, Utah (FA8201-19-D-A010); GSBS, Salt Lake City, Utah (FA8201-19-D-A012); HDR, Salt Lake City, Utah (FA8201-19-D-A011); Jacobs Engineering Group Inc., Taylorsville, Utah (FA8201-19-D-A009); Michael Baker International Inc., Midvale, Utah (FA8201-19-D-A007); Stanley Consultants Inc., Murray, Utah (FA8201-19-D-A006); and Stantec Consulting Services Inc., Salt Lake City, Utah (FA8201-19-D-A004) have been awarded a not-to-exceed $36,000,000 firm-fixed price, indefinite-delivery/indefinite-quantity contract for architectural and engineering services to support the 75th Civil Engineering Group mission. Work will be performed at Hill Air Force Base, Utah, or other geographically separated areas under their jurisdiction to include Little Mountain Test Annex, Utah Test and Training Range, and Boulder Seismic Station, and is expected to be completed by Sept. 8, 2024. This award is the result of a competitive, multiple award acquisition and 15 offers were received. Fiscal 2019 operations and maintenance funds in the amount of $500 are being obligated at the time of award. The Air Force Sustainment Center, Hill Air Force Base, Utah, is the contracting activity. General Electric Aviation, Cincinnati, Ohio, has been awarded a $19,429,512 firm-fixed price, indefinite-delivery/indefinite-quantity contract for F138 sustaining engineering, program management, and field service representative support. This contract provides the Air Force with the expertise required to support trending, diagnosis, analysis, and warranty administration for the F138 engine. Work will be performed at Dover Air Force Base, Delaware; Lackland Air Force Base, Texas; Robins Air Force Base, Georgia; Tinker Air Force Base, Oklahoma; Travis Air Force Base, California; Scott Air Force Base, Illinois; and Westover Air Force Base, Massachusetts, and is expected to be completed by Sept. 5, 2024. This award is the result of a sole source acquisition. Fiscal 2019 operations and maintenance funds in the amount of $1,831,638 are being obligated at the time of award. The Air Force Life Cycle Management Center, Tinker Air Force Base, Oklahoma, is the contracting activity. (FA8124-19-D-0005). Lockheed Martin Corp., Orlando, Florida, has been awarded a $14,958,516 task order against contract FA8533-18-D-0002 for the execution of a baseline change request/engineering change proposal which upgrades 99 common organizational level testers and accessory kits to the new baseline removing obsolescence issues. Work will be performed in Orlando, Florida, and is expected to be completed by Sept. 8, 2022. This award is the result of a sole source acquisition. Fiscal 2017 aircraft procurement funds in the amount of $14,958,516 will be obligated at time of award. The Air Force Life Cycle Management Center, Robins Air Force Base, Georgia, is the contracting activity (FA8533-19-F-0091). DEFENSE LOGISTICS AGENCY TEK Precision Co. Ltd.,* Deer Park, New York, has been awarded a maximum $17,638,194 firm-fixed-price, indefinite-delivery/indefinite-quantity contract for aviation servo coupling assemblies. This was a competitive acquisition with one offer received. This is a five year contract with no option periods. Location of performance is New York, with a June 24, 2025, performance completion date. Using military service is Army. Type of appropriation is fiscal 2019 through 2024 Army working capital funds. The contracting activity is the Defense Logistics Agency Aviation, Redstone Arsenal, Alabama (SPRRA1-19-D-0124). York Precision Machining and Hydraulics LLC,* York, Pennsylvania, has been awarded a maximum $13,681,333 indefinite-delivery/indefinite-quantity contract for sliding and fixed cones for the Intercontinental Ballistic Missile system. This was a sole source acquisition using justification 10 U.S. Code 2304(c) (1), as stated in Federal Acquisition Regulation 6.302-1. This is a five-year base contract with no option periods. Location of performance is Pennsylvania, with a Sept. 5, 2024, performance completion date. Using military service is Air Force. Type of appropriation is fiscal 2019 defense working capital funds. The contracting activity is Defense Logistics Agency Aviation, Hill Air Force Base, Utah (SPRHA2-19-D-0001). ARMY Alberici Constructors Inc., St. Louis, Missouri, was awarded a $14,610,600 firm-fixed-price contract for Miter Gate installation at Marseilles and Starved Rock Locks on the Illinois River Basin. Bids were solicited via the internet with two received. Work will be performed in Ottawa, Illinois, with an estimated completion date of Nov. 30, 2020. Fiscal 2019 civil construction funds in the amount of $14,610,600 were obligated at the time of the award. U.S. Army Corps of Engineers, Rock Island, Illinois, is the contracting activity (W912EK-19-C-0035). Winkler-NNAC JV,* Newman Lake, Washington, was awarded an $8,555,103 firm-fixed-price contract to repair drainage failures. Bids were solicited via the internet with four received. Work will be performed in Fort Hood, Texas, with an estimated completion date of Oct. 7, 2020. Fiscal 2019 operations and maintenance, Army funds in the amount of $8,555,103 were obligated at the time of the award. U.S. Army Mission and Installation Contracting Command, Fort Hood, Texas, is the contracting activity (W91151-19-C-0035). NAVY DONJON Marine Co. Inc., Hillside, New Jersey, is being awarded a $12,499,201 modification to previously awarded cost-plus-award-fee, indefinite-delivery/indefinite-quantity contract N00024-18-D-4307 deliver order N00024-19-F4D02 for continuation of emergency floodwater pumping operations in Puerto Rico under Army Corps of Engineers (ACOE) mission assignment. Work will be performed in Puerto Rico and is expected to be complete by June 2020. Non-expiring ACOE funding in the amount of $11,440,916 will be obligated at the time of award and will not expire at the end of the current fiscal year. The Naval Sea Systems Command, Washington, District of Columbia, is the contracting activity. BAE Systems Norfolk Ship Repair, Norfolk, Virginia, was awarded an $11,945,242 firm-fixed-price modification to previously-awarded contract N00024-18-C-4403 for additional growth requirements, including actions taken during Hurricane Florence, identified during the execution of the USS Tortuga (LSD 46) Fiscal 2018 Modernization Period (MODPRD) Chief of Naval Operations availability. Work will be performed in Norfolk, Virginia, and is expected to be completed by November 2019. Upward obligation of expired fiscal 2018 operation and maintenance (Navy) funding in the amount of $11,945,242 was used to fund this action in accordance with fiscal law. The Naval Sea Systems Command, Washington, District of Columbia, is the contracting activity. (Awarded Sept. 5, 2019) The University of California, Berkeley, California, is being awarded a $9,477,951 cooperative research agreement to study learning mechanisms to create computational models and enhance artificial intelligence approaches to learning, such as deep learning and reinforcement learning. All work will be performed at the University of California, Berkeley, California. This four-year agreement has no option periods. The period of performance is from Sept. 9, 2019, through Sept. 8, 2023. Fiscal 2019 research, development, test and evaluation funds (Defense Advanced Research Projects Agency) in the amount of $1,477,559 will be obligated at the time of award. This research agreement was competitively procured via broad agency announcement (HR001119S0005) and publication on the Federal Business Opportunities website. Forty-two offers were received and nine were selected for award. The Naval Information Warfare Center Pacific, San Diego, California, is the contracting activity (N66001-19-2-4034). DEFENSE INFORMATION SYSTEMS AGENCY CORRECTION: The Sept. 6, 2019, announcement of a contract award to Trace Systems Inc., Vienna, Virginia (HC1047-19-D-4002), in support of providing the full range of Mission Partner Environment (MPE)-compatible support services and associated equipment to design, implement and operate the MPE enterprise, included the incorrect ceiling value. The award's actual ceiling value is $998,000,000. All other information in the announcement is correct. CORRECTION: The contract announced on Sept. 6, 2019, to The Johns Hopkins University Applied Physics Laboratory, LLC (JHU/APL), Laurel, Maryland (HC1047-19-D-0001), for essential engineering, research, and/or development capabilities, in line with the core competencies established by the assistant secretary of defense for research and engineering, has not yet been awarded. *Small Business https://www.defense.gov/Newsroom/Contracts/Contract/Article/1955489/source/GovDelivery/
June 10, 2020 | International, Aerospace

Use existing and planned craft for unmanned logistical resupply
By: Wayne Prender and David Phillips To counter expected adversary anti-access/area denial strategies, U.S. naval forces will face significant challenges resupplying dispersed units under emerging distributed operations concepts, particularly in the large geographical distances of the Western Pacific. Future Marine littoral regiments, for example, will require layers of manned and unmanned vessels capable of moving personnel and materiel in decentralized operations to complicate enemy decision-making and targeting. Naval leaders have made clear such decentralized resupply of small, but lethal, expeditionary teams is key to defeating anti-access/area denial threats. With the Department of the Navy already challenged to affordably build and sustain a larger combat fleet, designing, buying and commissioning significant numbers of purpose-built craft solely for this purpose is not ideal. Rather, the Navy should look to adapt fleets of scaled derivative versions of existing or planned naval craft types — particularly those which can be unmanned or optionally manned for specific missions. This option provides the Navy with a greater breadth of capabilities at a more affordable cost. A future fleet of unmanned logistical connectors can leverage existing and planned programs of record. The technology already exists to optionally man or unman such vessels. Appropriately scaled and tailored derivatives of these vessels would conduct logistical cargo missions when required, in addition to performing the existing vital functions the craft already carry out for the fleet. The unmanned logistics fleet would be a necessary adjunct to larger planned manned assets, such as a next-generation light amphibious warship. Naval planners will have to strike a balance between size, capability and affordability. However, even with a lower cost, the vessels must still be large and flexible enough to be capable of performing multiple missions with different payloads. The resulting craft should also be able to reliably operate autonomously over a wide range of environmental conditions at significant distances, have a light logistics footprint and possess sufficient cargo-carrying capacity. Rather than a homogeneous unmanned cargo fleet, the Navy could instead utilize several derivatives of existing vessels it already operates or has planned, which will ease any additional maintenance or training burden. Marines operating in the wide-open spaces of the Western Pacific might, for example, use larger variants capable of hauling cargo over greater distances, while units in other geographic locations are equipped with smaller versions more appropriate for their specific environments. The ability to repurpose multiple craft types would allow a more diverse fleet composition of manned and unmanned vessels teamed for mission-tailored flexibility. Moreover, craft that can accommodate interchangeable payloads would also be available to naval planners for additional missions. For example, the vessels could be equipped with a variety of intelligence, surveillance and reconnaissance sensors to improve fleet situational awareness while also performing the cargo resupply missions. Buying scaled derivatives of existing program craft will bring additional benefits, including cost savings through economies of scale for acquisition, while minimizing any upfront developmental costs, as hull forms, key components and systems largely already exist. Moreover, because much of the basic systems and components will be common, training, maintenance and repair functions can be streamlined, adding yet more savings over the vessels' life cycles. Likewise, the technologies for unmanning and optionally manning are well along in their development, while autonomous behaviors and autonomy technologies developed for other programs can be reused rather than having to be created anew. For example, autonomous behaviors and control technologies developed for unmanned aircraft systems can be leveraged for naval applications, while similar autonomy technologies for unmanned ground vehicles are also progressing. Within the naval domain, experimentation such as Advanced Naval Technology Exercise 2019 and Exercise Citadel Shield-Solid Curtain earlier this year have already demonstrated that unmanned surface vessels can autonomously station keep, navigate around obstacles, protect high-value assets and conduct other necessary core functions. As autonomy technologies further develop, unmanned naval craft of the size and complexity envisioned for logistics and cargo hauling will be able to add new missions and functionality. Longer term, delivery of logistical payloads to Marines on a beachhead can be done completely with unmanned platforms. For example, small to medium robotic ground vehicles loaded with supplies could be carried by one of these unmanned logistical craft. Rather than Marines exposing themselves to hostile fire while unloading supplies on the beach, robotic ground vehicles or aerial drones disembark from the vessels and deliver cargo directly to the Marines in a more secure location. Such vehicles need not be fully autonomous, but rather could be partially autonomous or remotely operated from the security of the protected location. While many details of this concept require further exploration and refinement, conducting experimentation to bring truly multidomain capabilities to bear on the resupply challenge is a worthy endeavor. Getting these and related technologies into the hands of sailors, Marines and other U.S. forces to test and refine will be the quickest and most fruitful way to develop the new concepts and field the necessary capabilities. Wayne Prender and David Phillips are senior vice presidents at Textron Systems. https://www.defensenews.com/opinion/commentary/2020/06/09/use-existing-and-planned-craft-for-unmanned-logistical-resupply/
April 14, 2021 | International, Aerospace

Lockheed Martin to supply 12 MH-60R helicopters to South Korean navy
Lockheed Martin has secured a USD447.2 million contract for the production of 12 MH-60R Seahawk multirole naval helicopters for the Republic of Korea Navy (RoKN). The US Department of Defense (DoD) announced on 12 April that work on the Fore...

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