Corruption in China’s military is no excuse for American complacency

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  October 15, 2018 | International, Aerospace, Naval, Land, C4ISR, Security

  Contract Awards by US Department of Defense - October 12, 2018

  DEFENSE INFORMATION SYSTEMS AGENCY Iridium Satellite LLC, Tempe, Arizona, was awarded a non-competitive, firm-fixed-price $44,000,000 contract modification (P00008) for the extension of services on the current airtime contract (HC104714C4000) in accordance with Federal Acquisition Regulation 52.217-8. Fiscal 2019 defense working capital funds will be used. Performance will be at the contractor's facility. The period of performance for the option period is Oct. 22, 2018, through April 21, 2019. The Defense Information Technology Contracting Organization, Scott AFB, Illinois, is the contracting activity. DEFENSE LOGISTICS AGENCY Creighton AB Inc., Reidsville, North Carolina, has been awarded a maximum $35,000,000 fixed-price contract for Air Force lightweight jackets. This was a competitive acquisition with two responses received. This is a one-year base contract with four one-year option periods. Maximum dollar amount is for the life of the contract. Locations of performance are New York and North Carolina, with an Oct. 11, 2023, performance completion date. Using military service is Air Force. Type of appropriation is fiscal 2019 through 2024 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania (SPE1C1-19-D-1104). Simmonds Precision Products Inc., Vergennes, Vermont, has been awarded an $11,024,500 firm-fixed-price, indefinite-delivery/indefinite-quantity contract for electro-me actuators. This is a five-year base contract with four one-year option periods. This was a competitive acquisition with two responses received. Location of performance is Vermont, with an Oct. 15, 2023, performance completion date. Using military service is Army. Type of appropriation is fiscal 2019 Army working capital funds. The contracting activity is the Defense Logistics Agency Aviation, Redstone Arsenal, Alabama (SPRRA1-19-D-0004). Transaero Inc., Melville, New York, has been awarded a $9,500,000 firm-fixed-price, indefinite-delivery/indefinite-quantity contract for assembly clutches. This is a five-year base contract with four one-year options periods. This was a competitive acquisition with two responses received. Location of performance is New York, with a Nov. 30, 2023, performance completion date. Using military service is Army. Type of appropriation is fiscal 2019 Army working capital funds. The contracting activity is the Defense Logistics Agency Aviation, Redstone Arsenal, Alabama (SPRRA1-19-D-0002). ARMY Medvolt LLC,* Colorado Springs, Colorado, was awarded a $19,978,985 firm-fixed-price contract for upgrading the chilled water line system at the Cheyenne Mountain Air Force Station. Bids were solicited via the internet with one received. Work will be performed in Cheyenne Mountain Air Force Station, Colorado, with an estimated completion date of Oct. 15, 2020. Fiscal 2019 operations and maintenance (Army) funds in the amount of $19,978,985 were obligated at the time of the award. U.S. Army Corps of Engineers, Omaha, Nebraska, is the contracting activity (W9128F-19-C-0001). AIR FORCE Rockwell Collins, Richardson, Texas, has been awarded a $12,010,975 definitization (P000013) to previously undefinitized contract FA8204-18-C-0010 (P00005) to implement Security Classification Guide changes. Work will be performed at Richardson, Texas, and is expected to be completed by Dec. 3, 2020. Fiscal 2018, research, development, test and evaluation funds in the amount of $818,227 are being obligated at the time of award. Air Force Nuclear Weapon Center, Hill Air Force Base, Utah, is the contracting activity. NAVY Complete Parachute Solutions, Deland, Florida, is awarded a $9,270,000 modification under previously awarded firm-fixed-price contract (M00264-18-C-0007) for the Multi-Mission Parachute Course. The Multi-Mission Parachute Course provides training and technical support for all Military Free-Fall training to ensure compliance with all Federal Aviation Administration Regulations and Marine Corps Orders to safely meet the Marine Corps Training Input requirements. This contract includes four one-year option periods which, if exercised, could bring the cumulative value of this contract to $42,763,854. Work will be performed in Coolidge, Arizona, and is expected to be completed Sept. 27, 2019. If all options are exercised, work will continue through Sept. 27, 2022. Fiscal 2019 operations and maintenance (Marine Corps) funds in the amount of $9,270,000 will be obligated at the time of contract modification award and will expire at the end of the current fiscal year. The original contract was competitively solicited and competitively procured via solicitation on the Federal Business Opportunity website, with one proposal received. The Marine Corps Installation National Capital Region-Regional Contracting Office, Quantico, Virginia, is the contracting activity. FlightSafety Services Corp., Centennial, Colorado, is awarded an $8,354,866 modification (P00004) under a previously awarded firm-fixed-price contract (N6134018C0019) for aircrew training services in support of the TH-57B/C community, including instruction, operation, and curriculum support. Work will be performed at the Naval Air Station, Whiting Field, Florida, and is expected to be completed in October 2019. No funds are being obligated at time of award. The Naval Air Warfare Center Training Systems Division, Orlando, Florida, is the contracting activity. Huntington Ingalls Inc., Newport News, Virginia, is awarded a $7,031,737 cost-plus-fixed-fee modification to previously awarded contract (N00024-17-C-2103) to exercise an option for the accomplishment of planning and design yard functions for standard Navy valves of nuclear-powered submarines and aircraft carriers. Work will be performed in Newport News, Virginia, and is expected to be completed by September 2019. Fiscal 2019 operations and maintenance (Navy) funding in the amount of $600,000 will be obligated at time of award and will expire at the end of the current fiscal year. The Naval Sea Systems Command, Washington, District of Columbia, is the contracting activity. *Small Business https://dod.defense.gov/News/Contracts/Contract-View/Article/1660999/source/GovDelivery/

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  March 16, 2020 | International, Aerospace

  Possible New 'Engine War' Recasts Pratt As Champion Of Competition

  By Steve Trimble Pratt & Whitney's F100 (pictured) is designed to be interchangeable with GE Aviation's F110 as the engine for the Boeing F-15 fleet. A jet engine maker is pressuring the U.S. Defense Department to scrap a plan to award a sole-source contract to a rival for a fleet of new fighters and investigate the opportunity for performance and cost improvements yielded by a competitive selection process. If that narrative sounds familiar, it is because it echoes a role GE Aviation played for more than 40 years, which included a successful bid in the 1980s to launch the “Great Engine War” over the F-15 and F-16 fleets and a failed campaign that ended almost a decade ago to establish the F136 as the alternate engine for the F-35. This time, however, the roles are reversed. Pratt & Whitney, which waged fierce lobbying campaigns against competitive engine policies for the F-15, F-16 and F-35, has switched sides in the debate. In response to the U.S. Air Force's decision to field the F-15EX into production powered solely by GE F110 engines, Pratt has filed two protests with the Government Accountability Office (GAO), which is scheduled to render judgments on both cases by early July. The Air Force sided with GE during the Great Engine War in 1984. Seeking to lower costs and motivate Pratt to resolve stall-stagnation problems with the original F100, the Air Force decided that year to split the engine contract for the F-15 and F-16 between GE's F110 and Pratt's F100. Thirty-six years later, the Air Force now worries about the schedule impact if the GAO sustains either or both of Pratt's protests of the F-15EX engine. Service officials decided to acquire the F-15EX after concluding the F-15C/Ds were too costly to sustain and because it would take too long for the Pratt F135-powered F-35A to replace all of them. Pratt's protests threaten to disrupt that schedule and erode the Air Force's original business case for the F-15EX. “If we have to do an engine competition, it will add time—2-3 years,” said Will Roper, assistant secretary of the Air Force for Acquisition, Technology and Logistics, testifying before the House Armed Services Committee on March 10. Only a decade ago, Pratt welcomed a vote by Congress in 2010 to cancel funding for the F-35 program's alternate engine, along with a decision by GE and Rolls-Royce a year later to abandon a plan to self-fund the certification of the F136. But Pratt now embraces the potential benefits of an engine competition for the F-15EX. “Our government supports competition at all levels, and we're interested in providing the F100 as a competitive alternative,” Pratt Military Engines President Matthew Bromberg told Aviation Week. “If we're not competitive in terms of capability, schedule [and] price, I get it. But after the U.S. government spent all this money creating two engines for the F-15 and F-16 platforms, why would it then not compete a 450-engine program?” Asked if the existing F100 would require additional development to meet the Air Force's requirements for the F-15EX, Bromberg replied that he cannot answer that question in the absence of a competitive process that allows Pratt access to the specifications. He also noted that the F100 exclusively powers the Air Force's existing fleet of F-15Es. The F100 and F110 were designed to fit interchangeably in the F-15, although the heavily modified Saudi Arabian F-15SA and the Qatari F-15QA from which the F-15EX was derived are exclusively powered by GE's engine. The GAO does not release complaints filed by protesters up front, but it does release the full text of decisions. It is not clear why Pratt filed two separate protests on the sole-source decision for the GE engine on the F-15EX, but Bromberg advised not reading too much into it. “I'd like to obviously be able to discuss them, but I can't because it's a legal process,” Bromberg said. “I would really view them as a single protest on a single procurement action, and that is a lack of competition.” https://aviationweek.com/defense-space/aircraft-propulsion/possible-new-engine-war-recasts-pratt-champion-competition

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  April 24, 2020 | International, Aerospace

  What To Watch For As A&D Companies Plan Future With COVID-19

  Michael Bruno Companies have good quarters and bad quarters, but rarely does a whole industry sound like it just got sucker-punched. That's what the next few weeks will be like in the aerospace and defense sector, and for sure there will be headlines describing industrial carnage as the industry gasps for air and works to recover after COVID-19. The truth is the aerospace and defense (A&D) supply chain suddenly is far too large for what is needed, maybe by a quarter or a third of excess capacity. As a result, quick or methodical cutbacks in manufacturing and services are expected throughout the syndicates that make airliners, business jets and other aircraft. As public companies report their latest quarterly financial results in late April and May, they will have to address the year ahead and offer insight into their response plans. Unfortunately, business as usual prior to COVID-19 is not expected until 2022 or later, according to numerous analysts and advisors. And that is just too long to carry extra financial costs, which means all levels will feel pain. “The COVID-19 decline is a serious risk for commercial OEM plays—Boeing, Spirit AeroSystems, Allegheny Technologies, Hexcel, Howmet Aerospace, Triumph Group and Carpenter Technology,” Cowen analysts say. “Aftermarket ‘relative safe havens' Honeywell International, Heico and TransDigm Group also face stiff near-term headwinds, with more serious risks at General Electric.” If OEMs and their Tier 1 and 2 suppliers are already cutting their workforces, slashing executive salaries and suspending shareholder returns—as dozens have announced since the novel coronavirus began sweeping through the U.S. in March—then it is easy to imagine that much lower tiers with their even thinner margins could face existential reckonings. “People who didn't plan for it were unreasonably naive,” asserts Avitas consultant Adam Pilarski, a longtime expert who espoused a bearish view on commercial aviation long before the Boeing 737 MAX crisis started gumming up business models. “There is no magic potion here. You will have less production.” While Pilarski's comment may come across as harsh, it accurately describes the depth of the coming paradigm shift for commercial aviation. Yes, perhaps it was too much to have asked OEMs and suppliers to model for a 95% collapse in passenger air traffic and two-thirds of large commercial aircraft fleets getting parked—including brand-new deliveries. But practically no one seemed to imagine simultaneous cuts to new orders, standing backlogs and aftermarket revenue streams. Indeed, Pilarski was one of the few who envisioned an environment with much less than the traditional 5% annual growth in air traffic. That is now changing: Airbus has revealed narrowbody and widebody production rate cuts of about a third, and Boeing is expected to follow suit any day. According to Credit Suisse analysts, such sudden rate changes will have a materially negative impact on the supply chain because the effect is exponential. “[The supply chain] will need to cut production by much more as Airbus consumes its inventories—for instance, potentially going to rate 20 on the A320 for some months and ramping up again to 40,” the Credit Suisse analysts say. Boeing's inventory—including roughly 800 MAXs that are backed up with its customers and supplier Spirit AeroSystems and are waiting to join its own fleets—is worse. Still, it is not that simple to look at customers such as Airbus and Boeing and draw a direct line to suppliers to guess their fate. While the vast majority of publicly traded A&D companies have shelved the 2020 forecasts they offered just weeks before, almost no one has outlined new plans. For one thing, few suppliers had even received change orders as of early April, Ken Herbert of Canaccord Genuity says. Here are three factors to watch for in earnings reports to discern how the supply chains will change. First, how much U.S. government aid will companies receive? This is a significant variable, and as of mid-April, we still did not know how much even sector leader Boeing will receive (presuming it does). “Most suppliers we have spoken with are still waiting for more clarity on the exact terms available under the CARES Act,” says Herbert, who has deep ties in the A&D supply chain. Meanwhile, many public companies have been able to tap short-term financing or debt markets to boost liquidity—a testament to their prior investment grades. Second, the supply chain has experienced robust vetting and stress-testing over the past decade. Did it work? Record growth, record mergers and acquisitions, and record private equity involvement have dramatically consolidated industry (for better or worse). Yes, it meant elimination of countless companies, and some smaller survivors remain stressed by technology investments and meager working capital accounts. But top-tier companies have been working to eliminate chokepoints and shore up weak links in their supply chains for the last few years, ironically as they sought to raise rates. Finally, many companies became less susceptible one way or another, especially through revenue diversification (see chart). Take the new Raytheon Technologies, the first supplier to rival its OEM customers in annual sales. Manufacturers elbowed into the aftermarket; commercial providers and defense suppliers tapped into each other's markets; and venture capitalists and billionaire competitors entered into and prodded new technology advances that legacy industry had resisted funding, among other trends. Will this lead to resilience? Some think so. “In many ways, the supply chain is now more mature, diversified and well-positioned to handle this economic downturn versus in 2001 and 2008,” says Alex Krutz, managing director at Patriot Industrial Partners, an advisory firm focused on operations and supply chain. “A large number of suppliers over this last decade have taken significant steps to ensure their long-term success.” There are sure to be industrial casualties as A&D faces its greatest business falloff in history. We should mourn the loss of skilled workers and devoted people who are forced to exit the sector, but there are still new aircraft to build. And there will be supply chains to do it. https://aviationweek.com/aerospace/manufacturing-supply-chain/what-watch-ad-companies-plan-future-covid-19