Contract Awards by US Department of Defense - October 24, 2018

On the same subject

• 

  August 4, 2020 | International, Land

  Pandemic lengthens delay in US Army’s M113 vehicle replacement program

  By: Jen Judson WASHINGTON — The coronavirus pandemic has caused another delay for the U.S. Army's plagued M113 replacement program, which has struggled with manufacturing problems as the BAE Systems-made Armored Multi-Purpose Vehicle entered low-rate initial production, according to the company's second quarter fiscal 2020 earnings briefing released last week. The company had to delay delivery of the first LRIP vehicles by roughly four to six months, moving delivery from March to July. But as BAE prepared to move ahead on delivery, the pandemic hit, bringing with it another delay of roughly a month, which pushed the vehicles' delivery date to August. The AMPV program entered LRIP in January 2019, but the program office indicated last year that delivery of the first vehicles would be delayed by two months and the completion of production qualification testing would be delayed by seven months due to tooling and assembly line challenges at BAE's facility in York, Pennsylvania. Because of the issues, the Army's AMPV budget request in FY21 showed the program took a hit. The service indicated it would buy 32 vehicles instead of the 143 planned for the fiscal year, and the program's budget was cut from $445 million to $193 million. The Army and BAE developed “a production approach that would allow us to incorporate efficiencies during LRIP that modernize manufacturing and increase the overall throughput of the program,” Amanda Niswonger, a BAE spokeswoman, told Defense News in an Aug. 3 statement. “This included installing new technology and processes such as robotic welding, digital X-ray, and advanced machining. And we worked closely with the Army to update and refine manufacturing processes to incorporate the most modern weld and inspection technology,” she said. “These changes had an impact on our delivery timeline which was not reflected in the original delivery schedule, but continues to meet the Army's fielding schedule.” The service and BAE had formalized the schedule change just as COVID-19 hit the U.S., which affected a large number of manufacturing facilities and supply chains globally. “We have worked tirelessly to mitigate the impacts from COVID-19 with our employees, supply network, and customer base to keep our manufacturing sites operational and continue to receive parts as needed,” Niswonger said. “Unfortunately we could not overcome all the challenges and our first delivery has slipped one month.” https://www.defensenews.com/land/2020/08/03/pandemic-causes-latest-delay-in-us-armys-m113-replacement-program/

• 

  February 2, 2021 | International, Other Defence

  Vital Signs: Second Annual Study Reveals ‘C’ Average for Defense Industrial Base

  2/1/2021 By Wesley Hallman and Nick Jones This is part one of a five-part special report on the health of the U.S. defense industrial base. The National Defense Industrial Association's second annual Vital Signs report on the health of the U.S. defense industrial base will be released Feb. 2. To sign up in advance for a copy, please click HERE. In 2018, the Defense Department released “Assessing and Strengthening the Manufacturing and Defense Industrial Base and Supply Chain Resiliency of the United States,” a report focused on the production risks to critical defense industrial supply chains. The report starkly framed the health of the U.S. defense industrial base as key to the readiness of the nation to confront near-term threats and compete in an age of great power competition. Despite the report's high-resolution snapshot of the DIB's “unprecedented set of challenges,” the report did not provide a publicly available summary measurement of the health and readiness of the defense industrial base or a simple way of tracking it over time. To fill this gap, the National Defense Industrial Association in 2020 completed “Vital Signs 2020,” which provided an unclassified summary of the health and readiness of the defense industrial base that was accessible to both the public and the defense policy community. “Vital Signs 2021” is the second installment. In order to provide a comprehensive assessment, our procedure involved standardizing and integrating different elements that impact the performance of the defense industrial base and the overall business environment. Like “Vital Signs 2020,” this report's final grade for the health and readiness of the defense industrial base was a “C.” This year's score was 74, slightly lower than last year's 75. While passing, the “C” grade reflects a business environment that is characterized by contrasting areas of concern and confidence. It also reflects the state in which the defense industrial base entered the COVID-19 pandemic, which dramatically disrupted the daily lives of every American and the flow of U.S. commerce. Continued deterioration in industrial security and the availability of skilled labor and materials emerged from the analysis as areas of clear concern. Favorable conditions for competition in the defense contracting market and a rising demand for defense goods and services reflected growth in the U.S. defense budget and increased overseas sales. NDIA intends Vital Signs 2021 to contribute to the debate about national defense acquisition strategy by offering a common set of indicators — “vital signs” — of the defense industrial base partners that give the men and women in uniform an advantage in all warfare domains. In order to complete this year's Vital Signs, we conducted a months-long study of data related to eight different dimensions that shape the performance capabilities of defense contractors: competition; cost production input; demand for defense goods and services; investment and productivity in the U.S. national innovation system; threats to industrial security; supply chain performance; political and regulatory activity; and industrial surge capacity. We analyzed over 40 publicly available longitudinal statistical indicators, converted each of them into an index score on a scale of 0 to 100, and evaluated three years of scores for each indicator — a running three-year average to control for single-year anomalies. A score of 100 equates to a baseline associated with the Carter-Reagan buildup of 1979-1986 or, if corresponding data is not available, a more recent peak value. With the exception of our Vital Signs 2021 member survey, which was fielded in August 2020, our datasets are lagging indicators collected before the nationwide lockdowns that occurred in March 2020 at the beginning of the COVID-19 pandemic. These lagging indicators provide insights into how the defense industrial base entered the pandemic which may give future policymakers a baseline to evaluate the defense industrial base's ability to cope with disruptions due to a national crisis. Vital Signs 2021 reveals a defense industrial base that entered the COVID-19 pandemic in a weakened state. As noted, with the exception of data from our August 2020 Vital Signs 2021 member survey, most data were published before the disruptions caused by the nationwide COVID-19 lockdowns and the concomitant overseas actions impacting certain supply chains. The final “grades” are based solely on data from before the COVID-19 pandemic. Six conditions earned composite scores lower than 80, and four earned scores lower than 70, which we consider failing grades — the same as last year's report. These scores suggest that the defense industrial base is continuing to face multiple challenges to its ability to thrive. Industrial security scored the lowest among the eight dimensions with a 56 for 2020. Industrial security has gained prominence as massive data breaches and brazen acts of economic espionage by state and nonstate actors plagued defense contractors in recent years. To assess industrial security conditions, we analyzed indicators of threats to information security and to intellectual property rights. The score incorporates MITRE's annual average of the threat severity of the new cyber vulnerabilities, which improved slightly from the 2018 score of 17 to a similarly dismal score of 18, in 2020. In contrast, threats to IP rights scored 100 out of 100 for 2019 as the number of new FBI cases into IP rights violations steadily declined since reaching an all-time high in 2011. Defense industry production inputs also scored poorly in 2020 with a score of 68, a steady score since 2018. Major production inputs include skilled labor, intermediate goods and services, and raw materials used to manufacture or develop end-products and services for defense consumption. Our estimate of the size of the defense industry workforce, currently about 1.1 million people, falls substantially below its mid-1980s peak size of 3.2 million. The indicators for security clearance processing also contributed to the low overall score for production inputs as backlogs have improved but continue to persist. The competitive environment and the state of demand for defense goods and services were areas of confidence. Over the past few years, the Defense Department has averaged about 701,000 prime contracts a year and had over $394 billion in prime contract obligations in 2019, according to an analysis conducted by our research partner Govini. Analysis of the top 100 publicly traded defense contract recipients produced a competition score of 91 for 2020. Several high scoring indicators drove the strength of market competition conditions, including the low level of market concentration of total contract award dollars, the relatively low share of total contract award dollars received by foreign contractors, and the high level of capital expenditures in the defense industrial base. Additionally, the DIB earned a score of 77 for profitability for 2020, based on a new methodology for this edition of the report. Demand for defense goods and services received a score of 93 for 2020, which is a 16-point increase over 2018. The high score for demand is a result of the recent increase in contract obligations issued by the department. Total contract obligations grew from $329 billion in fiscal year 2017, to $394 billion in 2019, a 20 percent increase. Foreign military sales also grew by nearly 20 percent over the same time period. Other takeaways: Innovation conditions within the defense industrial base received a score of 71 for 2020, two points down from its 2018 score. Notably, the U.S. share of global investment in research and development was only 28 percent, down from a peak of 38 percent in 2001. In early 2020, before the pandemic took hold, the percentage of Americans that thought the United States was spending “too little” on national defense was nearly half as many as in 2018, the largest two-year drop since 1983, which may indicate a decrease in the American public's appetite for major increases in military spending. Acquisition reform and budget stability, two of NDIA's strategic priorities, continue to be top of mind for the defense industrial base. In the survey, when asked what the most important thing the government can do to help the defense industrial base, respondents said that streamlining the acquisition process (35 percent) and budget stability (nearly 32 percent) were the most important. When asked what conditions would limit their firm's willingness or ability to devote larger amounts of productive capacity to military production, 48 percent of respondents said uncertain prospects of continuing volumes of business was a moderate deterrent and 41.5 percent of respondents said that the burden of government paperwork was a moderate deterrent. Both findings underscore the continued importance of reforming the acquisition process and the need for budget stability. The capacity of the defense industrial base to grow its output and fulfill a surge in military demand stands as a key test of its health and readiness. Productive capacity and surge readiness earned a score of 66 for 2020, a 15-point decrease from 2019. Declines in output efficiency contributed to the declining trend. Productive capacity is baselined against the defense buildup that began under the Carter administration and accelerated through the Reagan administration. The Carter-Reagan Era buildup involved a 31 percent surge in Defense Department expenditures. The health and readiness of the DIB poses a challenge to the acquisition community. With the growing expectation for the defense industrial base to meet the challenges faced during an era of great power competition, Vital Signs 2021 highlights several hurdles that the base must overcome coming out of the COVID-19 pandemic. The overall health grade of “C” suggests a satisfactory ability to meet current industrial requirements. Our full report will release to the public at the end of January. We hope that Vital Signs 2021 will drive policy debates in the coming legislative policy cycle and inform the discussions and actions that lead to an improved grade for Vital Signs 2022 and beyond. Wesley Hallman is vice president of strategy and policy, and Nick Jones director of regulatory policy at NDIA. https://www.nationaldefensemagazine.org/articles/2021/2/1/second-annual-study-reveals-c-average-for-defense-industrial-base

• 

  July 13, 2021 | International, Aerospace, Naval, Land, C4ISR, Security

  DoD budget faces multiple obstacles | Actionable Intelligence

  Defense News' Joe Gould speaks to retired Major General Arnold Punaro about the defense budget.