July 18, 2023 | International, Other Defence
Defense Innovation Board pushes ‘Oasis’ fund for promising technology
The funding would help transition technology from startups and commercial companies to Defense Department procurement programs.
December 14, 2017 | International, Aerospace, Naval, Land, C4ISR, Security
American exodus? 17,000 US defense suppliers may have left the defense sector
WASHINGTON — A large number of American companies supplying the U.S. military may have left the defense market, according to a study announced Thursday, raising alarm over the health and future of the defense industrial base.
The Center for Strategic and International Studies study said the number of first-tier prime vendors declined by roughly 17,000 companies, or roughly 20 percent, between 2011 and 2015.
The full study, due to be released in January, was authored by CSIS Defense-Industrial Initiatives Group Director Andrew Hunter, Deputy Director Gregory Sanders and Research Associate Rhys McCormick. It was sponsored by the Naval Postgraduate School and co-produced by the Aerospace Industries Association, which released an executive summary on Dec. 14, the day of its annual aerospace and defense luncheon in Washington.
The authors, who used publicly available contract data, write that it's unclear — due to the limitations in the subcontract database —whether the companies have exited the industrial base entirely or still perform work at the lower tiers.
“There is no doubt that a huge portion of the recent turbulence in the defense industrial base has taken place among subcontractors, who are less equipped to tolerate the defense marketplace's funding uncertainly and often onerous regulatory regime — yet it remains extremely difficult to determine the real impact of these conditions on subcontractors,” the authors conclude.
Further details may yet be revealed by the Trump administration's ongoing review of the resiliency of the defense-industrial base. Defense Secretary Jim Mattis' assessment is due to President Donald Trump by mid-April 2018.
The CSIS summary links 2011 Budget Control Act caps, subsequent short-term budget agreements, and Congress' “unpredictable and inconsistent” appropriations process to the “lost suppliers, changes in competition and market structure, and other turmoil” it found. The years 2011-2015 are considered a period of defense drawdown and decline.
The authors, rather than focus strictly on the total decline of defense contract obligations over the entire period, chose to chart the “whipsaw” effect that struck certain sectors of the industrial base amid the imposition of sequestration in 2013 and subsequent budget caps.
Though the defense budget had been declining in the years leading up to the Budget Control Act, the implementation of an across-the-board sequestration budget cut in 2013 “marked a severe market shock that had a considerable impact on the defense industry,” the authors say.
Compared to the pre-drawdown fiscal 2009-2010 period, the start of the drawdown in fiscal 2011-2012, average annual defense contract obligations dropped 5 percent. When sequestration was triggered in fiscal 2013, defense contract obligations dropped 15 percent from the previous year. Average annual defense contract obligations fell 23 percent during the so-called BCA decline period, fiscal 2013-2015.
The Army, which has a checkered modernization history, bore the brunt of the decline. Average annual defense contracts dropped 18 percent at the start of the drawdown, then 35 percent during the BCA decline period.
Missile defense contract obligations actually gained 7 percent at the start of the drawdown and then dropped only 3 percent under budget caps. During his presidency, Barack Obama reversed course from early cuts to missile defense to spur the development and deployment of missile defense systems in Europe, Asia and the Middle East.
Lockheed Martin CEO Marillyn Hewson reacted to the internally circulated findings earlier this month, saying budget cuts are responsible for the industry being “more fragile and less flexible than I've seen it, and I've been in the industry many, many years.”
“What we've seen in the industry, I'll give you an example at Lockheed Martin: At the outset of budget cuts we were about 126,000 employees; today we are at 97,000 employees,” Hewson said at the Reagan National Defense Forum in California. “Our footprint has shrunk dramatically. We see some of our small and medium-sized business, some of the components that we need, there's one, maybe two suppliers in that field where there were many, many more before.”
Budget cuts have squeezed the Defense Department to unduly prioritize low-cost contracts over innovation and investment. Cost “shootouts,” she said, are endangering the military's plans to grow in size and lethality.
AIA Vice President for National Security Policy John Luddy said companies have coped through a variety of “healthy efficiencies,” such as mergers and acquisitions, consolidating facilities, exploring shared services, and offloading certain contracting activities.
“Our companies have done an amazing job of managing the downturn, they've pulled all kinds of levels to make it work, they've shown the ingenuity of the American free market system,” Luddy said. “Nonetheless, the uncertainty of the budgeting process has become a huge challenge for us.”
Army Secretary Mark Esper, formerly of Raytheon, warned lawmakers at a Senate hearing Dec. 7 that uneven funding is driving small suppliers — “an engine of innovation” — out of the defense sector.
“If you're a small mom and pop shop out there, and I'm referring to my industry experience, it's hard for them to survive in the uncertain budgetary environment,” Esper said. “And we risk losing those folks who may over time decide that they're going to get out of the defense business and go elsewhere. So that's a big threat to our supply chains.”
But the CSIS study found that small vendors either increased their share of platform portfolio contract obligations or held steady, while large and medium vendors were most harmed by the market shock from sequestration and the defense drawdown.
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July 4, 2019 | International, Security, Other Defence
U.S. Security Requires Multiple Elements of Deterrence
BY C. TODD LOPEZ In the context of U.S. defense policy, "deterrence" is typically understood to mean "nuclear." And America's nuclear triad — ground-based missiles, air-delivered bombs, and submarine-launched missiles — serves as America's biggest form of deterrence, which underwrites everything its men and women in uniform do. But according to Chief of Naval Operations Adm. John M. Richardson, nuclear weapons are just one of multiple elements of deterrence the U.S. must consider either for itself, or for being aware that other nations might be using them. During a July 2 breakfast presentation hosted by the Mitchell Institute for Aerospace Studies in Washington, Richardson laid out five such elements of deterrence already in use or that must be considered more deeply. Nuclear "It's an incredibly powerful military capability where potentially everybody gets destroyed," Richardson said. "We must maintain our ability to be competitive and relevant in this domain ... [and] strike back at anybody who can pose an existential nuclear threat to the homeland." The triad itself includes ground-based missiles — commonly referred to as intercontinental ballistic missiles; submarine-launched ballistic missiles; and air-launched cruise missiles dropped from bomber aircraft. In all three areas the U.S. is underway with modernization efforts. But the nuclear environment globally is changing, Richardson said. "More nations are seeking to join the club," he said. Some of those nations can bring high-tech weapons, while some are using low-tech, including dirty bombs and systems that can be manufactured with 3-D printers. Additionally, not all nuclear weapons are "strategic" in nature. Some are smaller "tactical" weapons. "The nuclear element of this mix remains very relevant, very active, and deserves a lot more attention in my mind," Richardson said. Cyber Richardson said when it comes to cyber as a deterrent, the U.S. can't maintain only defensive capabilities. "We have to have an ability for offensive cyber to truly achieve a sense of deterrence there," he said. Recent cyber provocations, he said, are "multidimensional in ways that may or may not have been expected." Included there, he said, are theft of intellectual property, invasion of privacy, invasion of identity, distortion of identity, "and most recently, perception management. This perception management idea ... might be kind of our new Sputnik moment." Space "The competition is absolutely heating up in space," Richardson said. "Of these elements that are going to constitute a tailored strategic deterrent approach, space has got to be one of those." Richard posited that in space, it might become apparent that, using directed energy weapons, it proves far easier to destroy something in space than it is to put something back up into space. "These things operate really fast ... and space goes away as an asset," he said. "You can see kind of a mutually assured destruction scenario in space pretty easily. Have we thought about that going forward?" Chemical, Biological Capabilities Increasingly, Richardson said, chemical and biological deterrence will come into the mix, especially as technologies such as CRISPR — a genome editing tool — allow for more tailored capabilities. "One of the self-deterrent aspects of chemical/biological is that it's very hard to control. It goes viral, if you will," he said. "But with these tailoring things, you can get a lot more specific. It becomes a lot more targetable. And so, it's something we have to mind." Conventional Weapons U.S. deterrence advantages in conventional weapons have relied, so far, on superior targeting ability, Richardson said. But that may become less important. "We have better sensors, better satellites, better ways to connect that data with our command and control systems, our targeting systems," he said. "We had an advantage in terms of precision." Now, he said, such sensors are ubiquitous, and commercial and military sensors are going up into space. There are cameras everywhere. "This idea of being able to locate things with precision is becoming more ubiquitous," he said. "It's less of an advantage. It's really the team that can manage that information better that's going to achieve the advantage." https://www.defense.gov/explore/story/Article/1896147/us-security-requires-multiple-elements-of-deterrence/
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August 17, 2020 | International, Land
After months of haggling, Lockheed moves on German air defense bid
By: Sebastian Sprenger COLOGNE, Germany — Lockheed Martin and MBDA Deutschland have submitted another bid for Germany's next-generation air defense system, following negotiations throughout the summer that some observers said nearly tanked the project. The “updated proposal,” as the companies called it in a joint statement Friday, presumably will find smooth sailing in the Defence Ministry's upcoming analysis. That is because government officials and company executives already went through extensive discussions in the past few months to iron out sticking points left unresolved in previous bids and re-bids. “In the last months we made progress in further detailing the Integrated Master Schedule, relevant specifications as well as performance simulations to de-risk the future contract,” Thomas Gottschild, managing director at MBDA Deutschland, said in the statement. But there are no guarantees, especially when it comes to the famously circuitous Taktisches Luftverteidigungssystem, or TLVS. The program grew out of the now-defunct Medium Extended Air Defense System, which the Pentagon helped fund. Germany wants the weapon to replace its fleet of Patriot batteries. The German Defence Ministry did not immediately respond to a request for comment. The government in Berlin is under the gun to deliver military programs on time and on budget, especially now that the ministry wants to keep up defense spending despite the economic blow of the coronavirus pandemic. As a result, officials want to place greater financial liability on the contractors in case things go awry. That approach is infused throughout the TLVS contractual categories of “risk” and “terms and conditions,” industry officials previously said, though details are under strict wraps. Executives previously argued the proposed risk distribution is unsuitable for a development-heavy program like TLVS, making Lockheed especially wary of pursuing the deal after all. At the same time, the American defense giant finally needs to sell the program to a government customer if it wants the advertised revolution in missile defense equipment to actually happen. The envisioned weapon will feature a 360-degree sensing and shooting capability, which means operators no longer need to anticipate from which direction aerial threats will likely approach, as was the case with the sectored Patriot system. “TLVS will transform Germany's defense capabilities and set an important precedent in how neighboring nations address persistent global threats for years to come,” Lockheed and MBDA claimed in their joint statement. The German parliament, currently in recess, will have to approve the government's acquisition plan for TLVS — that is, if the industry consortium's newest submission makes the ministry's cut. https://www.defensenews.com/industry/2020/08/14/after-months-of-haggling-lockheed-moves-on-german-air-defense-bid/