August 14, 2018 | International, Naval
By: Tom Kington and Pierre Tran
ROME and PARIS — Italian shipyard Fincantieri has bought a key Italian technologyfirm to gain extra clout ahead of a planned team-up with France's Naval Group.
State-controlled Fincantieri said Aug. 7 it was jointly taking control of Vitrociset, which employs 800 people and posted 2017 sales of €187 million (U.S. $211 million) from its training and support work in the defense, security, transport and space sectors.
The shipyard will take over Vitrociset's defense work, while its partner in the purchase, Italian firm Mer Mec, will assume control of its civil work.
That leaves Fincantieri, which builds warships, submarines and cruise ships, in charge of Vitrociset's aerospace work, including ground support work on the F-35 Joint Strike Fighter.
The move triggered speculation in Italy that Fincantieri was bulking up to gain a stronger hand as it proceeds with cooperation talks with French shipyard Naval Group, given that Vitrociset is involved in automation, command and control, simulation, and testing work.
A company source played down the timing of the deal, saying: “Vitrociset simply makes us more complete.”
The announcement followed a visit to Rome on Aug. 1 by French Economy and Finance Minister Bruno Le Maire to discuss the Fincantieri-Naval Group talks, which started last year but slowed during the creation of a new, populist government in Italy in June.
The new government in Rome has had a series of spats with Paris, starting with France's reluctance to take in migrants who sail from Libya to Italy. The Italian government is also reluctant to move ahead on a new rail link between Italy and France, even though millions of euros have been spent on the program. And France and Italy are at loggerheads over lawless Libya, where the European nations back opposing sides in the slow-burning conflict.
Tensions reached a peak last month when Italian Deputy Prime Minister Matteo Salvini openly said he did not want France to win the soccer World Cup, which it did.
In June, Naval Group and Fincantieri handed their respective governments plans for possible industrial cooperation, a move seen by Fincantieri Chairman Giuseppe Bono as leading to an“Airbus of the sea,” seen as kick-starting a wider integration of the fractured European naval industry.
Addressing Italy's Parliament this month, Bono said he was also backing moves by the European Union to encourage joint spending among partners, effectively leading to pooled EU defense procurement from transnational European defense giants.
“Europe spends little and spends badly,” he said. “Everyone acts in the interest of their own nation; but if we concentrated, we could spend less but be more capable and more efficient.”
Fincantieri is already set to take over French civil shipyard STX, and at the start of the year, Bono said a French-Italian merger of naval work could occur within five to 10 years.
However, Le Maire was cautious during his Rome visit, claiming “it would not be wise” to talk of a naval merger.
Current plans go no further than a 10 percent share cross-holding, combined with pooling research, acquisition of material and teaming on export work to reduce competition.
Naval Group avoids the use of the Airbus tag, which signals a high degree of industrial consolidation, and prefers to refer to closer cooperation.
The cooperation plan is creating uncertainty over the role to be played by Italian and French firms Leonardo and Thales, which rely on selling their systems for their nations' warships.
Speculation that Leonardo would be sidelined in future joint ships built by Fincantieri and Naval Group increased with news of the Italian yard's purchase of Vitrociset, although Bono promised that Leonardo's involvement in the tie-up was “on the cards,” pointing out how it was an integral part of two offers of corvettes that Fincantieri was making to Romania and Brazil.
Thales, which holds a 35 percent stake in Naval Group, also reportedly expressed caution about linking up Naval Group and Fincantieri, an Italian source told Defense News.
This year, a leaked 36-page report from ADIT, a partially French state-owned company working in economic intelligence, painted a “highly negative” picture of the compliance and ethics of Fincantieri, a depiction which was challenged by Fincantieri.
“There is a lack of communication, a lack of figures,” according to Fabrice Wolf, a defense economics analyst. “This leads many to be concerned that this project is ideologically driven and that the realities of the industrial base are not fully taken into account.”
The main interest for Naval Group is to find work for its research office, which is the real reason for the FTI intermediate frigate program, he said.
There is a “concern” elsewhere in French industry, notably at Thales, which sees its sale of radars and electronic systems under risk from Italian archrival Leonardo, Wolf added.
“Naval Group is a great partner for Thales and I hope that lasts,” said Thales CEO Patrice Caine, business daily Les Echos reported May 27. Thales is more than just a shareholder in Naval Group, as the former transferred its combat systems business to the latter in 2007 in exchange for a shareholding, he added.
“When we build the FTI frigate with Naval Group, it's like building the Rafale with Dassault — it's a link up for life,” he said, pondering the intentions of an Italian government that pursues nationalism and a protectionist trade policy.
Naval Group and Thales were unavailable for comment.
The Italian pursuit of anti-immigration and anti-free trade seems to have struck a chord with U.S. President Donald Trump, who met Italian Prime Minister Giuseppe Conte at the White House on July 30.
“Italy is becoming a reference country in Europe and a privileged partner of the United States,” Trump said.
That U.S. preference for Italy effectively puts Rome ahead of Paris, French media have reported.
February 7, 2023 | International, Aerospace
The program’s focus is on designing, building, and testing a seaplane that can operate efficiently at less than 100 feet above the ground, hold flight altitudes of up to 10,000...
July 20, 2020 | International, Aerospace, Naval, Land, C4ISR, Security
AIR FORCE Lockheed Martin Corp., Marietta, Georgia, has been awarded a $15,000,000,000 indefinite-delivery/indefinite-quantity contract for C-130J development, integration, retrofit and production activities for all C-130J variants. This contract provides flexibility to accommodate the broad enterprise of activities associated with the C-130J program. Work will be performed in Marietta, Georgia, and is expected to be completed July 16, 2030. This contract involves Foreign Military Sales and is the result of a sole-source acquisition. Fiscal 2018 and 2019 aircraft procurement funds in the amount of $3,300,000 are being obligated at the time of award. Air Force Life Cycle Management Center, Wright‐Patterson Air Force Base, Ohio, is the primary contracting activity (FA8625‐20‐D‐3000). Leidos Inc., Arlington, Virginia, has been awarded a ceiling $30,000,000 indefinite-delivery/indefinite-quantity contract for high speed attack munitions research. The first task order will be for a $341,500 award under task order FA8651-20-F-1011. The five-year contract will support research and development, advancing state of the art in weapons airframe research to explore the impacts of complex flight environments on advanced weapon systems. Work will be performed at Eglin Air Force Base, Florida, and is expected to be completed August 2021 for the initial task order. Fiscal 2020 research, development, test and evaluation funds in the amount of $325,000 are being obligated at the time of award. Air Force Research Laboratory, Eglin Air Force Base, Florida, is the contracting activity (FA8651-20-D-0011). DEFENSE LOGISTICS AGENCY Stryker Corp., doing business as Stryker Endoscopy, San Jose, California, has been awarded a maximum $225,000,000 fixed-price with economic-price-adjustment, indefinite-delivery/indefinite-quantity contract for patient monitoring and capital equipment systems and accessories. This was a competitive acquisition with 52 offers received. This is a five-year base contract with one five-year option period. Location of performance is California, with a July 16, 2025, ordering period end date. Using customers are Army, Navy, Air Force, Marine Corps and federal civilian agencies. Type of appropriation is fiscal 2020 through 2025 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania (SPE2D1-20-D-0011). Stonewin LLC, Miami, Florida, has been awarded a minimum $7,775,696 modification (P00001) to a 54-month contract (SPE605-20-D-4522) with a six-month option period to increase funds for various types of fuel. This is a fixed-price with economic-price-adjustment contract under solicitation SPE605-20-R-0200. This modification increases the contract ceiling from $2,700,575 to $10,476,271. Locations of performance are Arizona, California, Florida, Nevada and Utah, with a Sept. 30, 2024, performance completion date. Using customers are Army, Navy, Air Force, Marine Corps and federal civilian agencies. Type of appropriation is fiscal 2020 through 2024 defense working capital funds. The contracting activity is the Defense Logistics Agency Energy, Fort Belvoir, Virginia. U.S. SPECIAL OPERATIONS COMMAND Collins Aerospace Inc., Cedar Rapids, Iowa, was awarded a $126,000,000 maximum indefinite-delivery/indefinite-quantity, firm-fixed-price, cost-plus-fixed-fee and cost-reimbursable contract (H92241-20-D-0002) in support of U.S. Special Operations Command (USSOCOM) for continued research, development, production and sustainment of the common avionics architecture system, avionics management system and cockpit management system used on Army special operations aircraft. Fiscal 2020 operations and maintenance funds in the amount of $346,082 were obligated at the time of award. The majority of the work will be performed in Cedar Rapids. The contract is a non-competitive award and is in accordance with Federal Acquisition Regulation 6.302.1. USSOCOM, Tampa, Florida, is the contracting activity. NAVY Raytheon Missiles and Defense, Marlborough, Massachusetts, is awarded a $125,881,928 fixed-price, incentive fee modification to previously awarded contract N00024-16-C-5370 to exercise options for the Enterprise Air Surveillance Radar (EASR) low rate initial production (LRIP). Work will be performed in Marlborough, Massachusetts (76%); Andover, Massachusetts (18%); Sudbury, Massachusetts (5%); and Portsmouth, Rhode Island (1%). This option exercise is for the production of six EASR LRIP units; four AN/SPY-6(V)2 (air and missile defense radar) EASR rotator LRIP units; and two AN/SPY-6(V)3 EASR fixed-faced LRIP units. The AN/SPY-6(V)2 EASR rotator LRIP units will be deployed on the USS Bougainville (LHA-8); USS John C. Stennis (CVN-74); USS Richard M. McCool Jr. (LPD-29); and USS Harrisburg (LPD-30). The AN/SPY-6(V)3 EASR fixed-faced LRIP units will be deployed on USS John F. Kennedy (CVN-79); and USS Brooke (FFG-1). Work is expected to be completed by January 2023. Fiscal 2017, 2018 and 2020 shipbuilding and conversion (Navy) funding in the amount of $122,301,170 will be obligated at time of award. Funds will not expire at the end of the current fiscal year. The Naval Sea Systems Command, Washington, D.C., is the contracting activity. Lockheed Martin Corp., Fort Worth, Texas, is awarded a $935,530,602 contract, which consists of an $895,531,143 not-to-exceed cost-plus-incentive-fee, cost-plus-fixed-fee, fixed-price-incentive-firm, firm-fixed-price undefinitized line item; and a $39,999,459 cost-plus-incentive-fee definitized line item. The undefinitized line items procure support equipment, autonomic logistics information system hardware, training systems, site activations and integrated contractor support for the F-35 Lightning II. Additionally, definitized line items on this contract support tasking that will result in improvements to the reliability, availability, maintainability and total ownership cost of the F-35 Lightning II for the Air Force, Marine Corps, Navy, non-Department of Defense (DOD) participants and Foreign Military Sales (FMS) customers. Work will be performed in Orlando, Florida (76%); Fort Worth, Texas (10%); Redondo Beach, California (9%); Owego, New York (4%); and Samlesbury, United Kingdom (1%), and is expected to be completed by March 2026. Fiscal 2020 aircraft procurement (Navy) funds in the amount of $205,656,772; fiscal 2020 aircraft procurement (Air Force) funds in the amount of $153,835,313; non-DOD participant funds in the amount of 279,748,427; and FMS funds in the amount of $62,479,903 will be obligated at time of award. No funds will expire at the end of the current fiscal year. The Naval Air Systems Command, Patuxent River, Maryland, is the contracting activity (N00019-20-C-0032). ARMY Bryan 77 Construction JV, Colorado Springs, Colorado (W912GB-20-D-0004); Framaco International Inc., Rye Brook, New York (W912GB-20-D-0005); Sociedad Espanola De Montajes Industriales SA, Madrid, Spain (W912GB-20-D-0006); Serka Taahhut Insaat Anonim Sirketi, Istanbul, Turkey (W912GB-20-D-0007); SKE SRL, Vicenza, Italy (W912GB-20-D-0008); and Zafer Taahhut Insaat Ve Ticaret Anonim Sirketi, Ankara, Turkey (W912GB-20-D-0009), will compete for each order of the $49,950,000 firm-fixed-price contract to provide design-build and design-bid-build construction services in Bulgaria and North Macedonia. Bids were solicited via the internet with 12 received. Work locations and funding will be determined with each order, with an estimated completion date of July 16, 2025. U.S. Army Corps of Engineers, Wiesbaden, Germany, is the contracting activity. South Dade Air Conditioning and Refrigeration Inc.,* Homestead, Florida, was awarded a $49,877,832 firm-fixed-price contract to provide all plant, labor, materials and equipment to provide road repair and paving in support of Fort Stewart and Hunter Army Airfield, Georgia. Bids were solicited via the internet with nine received. Work locations and funding will be determined with each order, with an estimated completion date of July 19, 2023. U.S. Army 419th Contracting Support Brigade, Fort Stewart, Georgia, is the contracting activity (W9124M-20-D-0007). Savi Technology Inc.,* Alexandria, Virginia, was awarded a $45,805,123 firm-fixed-price contract for active radio frequency identification transponder tags to track equipment worldwide. Bids were solicited via the internet with one received. Work locations and funding will be determined with each order, with an estimated completion date of July 16, 2024. U.S. Army Contracting Command, Rock Island Arsenal, Illinois, is the contracting activity (W52P1J-20-D-0034). Hughes Construction Services LLC,* Ozark, Alabama, was awarded a $45,000,000 firm-fixed-price contract for rapid-response temporary roofing projects in the continental U.S. coastal regions in the event of an emergency. Bids were solicited via the internet with 16 received. Work locations and funding will be determined with each order, with an estimated completion date of May 31, 2027. U.S. Army Corps of Engineers, Omaha, Nebraska, is the contracting activity (W9128F-20-D-0037). General Dynamic Land Systems Inc., Sterling Heights, Michigan, was awarded a $44,415,556 modification (PZ0003) to contract W56HZV-20-F-0060 to procure improved fire control electronics units in support of the Abrams expedited active protection system-trophy. Work will be performed in Tallahassee, Florida, with an estimated completion date of Oct. 1, 2022. Fiscal 2020 weapons and tracked combat vehicles procurement (Army) funds in the amount of $44,415,556 were obligated at the time of the award. U.S. Army Contracting Command, Detroit Arsenal, Michigan, is the contracting activity. Southwest Valley Constructors, Albuquerque, New Mexico, was awarded a $22,303,760 modification (P00015) to contract W912PL-19-C-0015 to modify existing barrier wall electrical attributes, closed circuit television, linear ground detection system and shelters. Work will be performed in Lukeville, Arizona, with an estimated completion date of Sept. 7, 2021. Fiscal 2020 operations and maintenance (Army) funds in the amount of $22,303,760 were obligated at the time of the award. U.S. Army Corps of Engineers, Phoenix, Arizona, is the contracting activity. ESI Contracting Corp.,* Kansas City, Missouri, was awarded an $11,662,196 firm-fixed-price contract for Missouri River levee system repair. Bids were solicited via the internet with two received. Work will be performed in Brunswick, Missouri, with an estimated completion date of Feb. 1, 2022. Fiscal 2020 civil flood control and coastal emergencies funds in the amount of $11,662,196 were obligated at the time of the award. U.S. Army Contracting Command, Kansas City, Missouri, is the contracting activity (W912DQ-20-C-1087). Great Lakes Dredge and Dock Co. LLC,* Oak Brook, Illinois, was awarded an $8,841,345 firm-fixed-price contract for maintenance dredging of the inland waterway C&D Canal federal navigation project. Bids were solicited via the internet with two received. Work will be performed in Chesapeake City, Maryland, with an estimated completion date of Jan. 29, 2021. Fiscal 2020 civil operations and maintenance funds in the amount of $8,841,345 were obligated at the time of the award. U.S. Army Corps of Engineers, Philadelphia, Pennsylvania, is the contracting activity (W912BU-20-C-0031). DEFENSE ADVANCED RESEARCH PROJECTS AGENCY Lockheed Martin Corp., Rotary and Mission Systems, Riviera Beach, Florida, has been awarded an $11,196,098 cost-plus-fixed-fee contract to support a Defense Advanced Research Projects Agency program. Fiscal 2020 research and development funds in the amount of $5,600,000 are being obligated at the time of award with an estimated completion date of September 2021. The Defense Advanced Research Projects Agency, Arlington, Virginia, is the contracting activity (HR0011-20-C-0139). Lockheed Martin Corp., Missiles and Fire Control, Grand Prairie, Texas, was awarded a cost-plus-fixed-fee contract to support the Operational Fires Integrated Weapon System Phase 3 program. This modification exercises the Contract Line Item Number 0005 option (valued at $7,451,558) for the development, building, integration, assembly, testing and checkout of the propulsion components for the Stage 2 section of the missile. Fiscal 2020 research and development funds in the amount of $1,000,000 are being obligated at the time of award. Work will be performed in Camden, Arkansas (50%); Huntsville, Alabama (45%); and Orange, Virginia (5%), with an estimated completion date of January 2022. The Defense Advanced Research Projects Agency, Arlington, Virginia, is the contracting activity (HR0011-20-C-0038). (Awarded Jan. 10, 2020) *Small Business https://www.defense.gov/Newsroom/Contracts/Contract/Article/2278883/source/GovDelivery/
April 30, 2020 | International, Aerospace
Lee Hudson Graham Warwick Boeing is facing a novel coronavirus-related setback to the VC-25B presidential transport program, causing the company to recognize a $168 million impact in the first quarter. The VC-25B effort faced “inefficiencies” because personnel were directed to work virtually because of COVID-19. This forced Boeing to re-evaluate its estimate, Greg Smith, the company's chief financial officer, told reporters April 29 following a first-quarter earnings call. “The reach-forward loss on VC-25B is associated with engineering inefficiencies from the COVID-19 environment,” according to Boeing's first-quarter earnings report. “We believe these inefficiencies will result in staffing challenges, schedule inefficiencies and higher costs in the upcoming phases of the program.” The U.S. Air Force acknowledged the VC-25B program is a victim of COVID-19 because of component delivery delays from overseas suppliers, the service's acquisition executive, Will Roper, told reporters April 29. However, the V-25B program is a fixed-price contract, meaning Boeing will take the financial hit, not the Air Force. Smith reiterated that despite the financial loss, the program remains on schedule. Boeing began structural modifications on the first 747-8 aircraft to become a VC-25B in March after removing the interior, engines, auxiliary power units and other subsystems. The Air Force acquired the 747-8s in 2017 after selecting Boeing to replace two VC-25As that now perform the role. The service anticipates spending $5.3 billion to complete modifications on both aircraft to begin operations at the end of 2024. https://aviationweek.com/defense-space/budget-policy-operations/covid-19-impacts-air-force-one-replacement-bottom-line