Netherlands signs letter of acceptance for $1.2 billion Apache helicopter upgrade

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  March 2, 2020 | International, Aerospace, Naval, Land, C4ISR, Security

  French defense firms fête formidable profits in 2019

  By: Christina Mackenzie PARIS – France's major defense companies are looking back at a strong 2019, thanks to a combination of exceptional contracts and the country's overall healthy economy, executives said this week. In the naval sector, Naval Group's orders shot up 44 percent to €5.3 billion ($5.8 billion) in 2019, taking the company's order book to a total of €15.1 billion ($16.6 billion). Of this, 38 percent is for the export market and 62 percent is for France. Roughly three quarters of the business were in the shipbuilding sector, with almost one quarter in services. These figures do not include the whole of the contract to build 12 submarines for Australia, “as this income will be shown as it is paid, tranche by tranche,” explained outgoing CEO Hervé Guillou. In addition, the group saw a 6 percent rise in EBIT (earnings before interest and taxes) to €282 million ($310 million) and a 3 percent rise in revenues to €3.7 billion ($4 billion). Guillou, who will be replaced as CEO in March by Pierre-Eric Pommellet, said his successor had four main challenges for the future: delivering the Suffren submarine; accelerating production in the face of Chinese competition; consolidating the group's international presence; and developing the workforce. In the land sector, revenues for Arquus, the French company which is the defense arm of Sweden's Volvo Group, rocketed 72.5 percent between 2017 and 2019. CEO Emmanuel Levacher said he was not allowed to give revenue and sales figures for Arquus, whose revenues are included in the Volvo “Group functions and other” column. However, those data show net sales for 2019 were SEK8.8 billion ($911.4 million), which means they are likely around the $660 million mark. Levacher was all smiles announcing “a very great year” that was “exceptionally rich,” remarking that “this is remarkable growth for an industrial company.” He said he expected the company to grow a further 10 percent in 2020. Exports accounted for 42 percent of the revenue. Levacher was able to put a figure on contracts signed in 2019: €1.2 billion ($1.3 billion) “mostly in Africa,” but also a tranche of €214 million ($235 million) in the framework of the CaMo contract with Belgium for 382 Griffon multirole armored vehicles and 60 Jaguar armored reconnaissance and combat vehicles to be delivered between 2025 and 2030. Levacher said contracts were also signed for “a few dozen” Sherpa and Dagger vehicles for the Middle East. He was optimistic for the future, remarking that “all of the French army's military trucks, whether they be 4×4s, 6×6s, 8×8s all need to be changed in the next five years.” He said the company had developed a specific truck to meet these needs as the call for tender will be published before the end of this year. In the defense-electronics sector, Thales's CEO Patrice Cain also described 2019 as “a good year in which we progressed.” Its EBIT rose 19 percent to slightly over €2 billion ($2.2 billion), “the first time we've gone over the symbolic bar of €2 billion,” he said. Defense accounts for 40 percent of the group's revenues. Order intakes in the defense and security sector rose a record 17 percent to €9.9 billion ($11 billion) while sales rose 6.4 percent, “a little higher than anticipated,” according to CFO Pascal Bouchiat, to €8.3 billion ($9 billion). These include Thales and Babcock winning the bid for the T31 frigate in the UK against BAE Systems. Bouchiat noted that “several multi-year contracts” had been signed “underpinning long-term growth” for the group. Finally, in the military-aircraft sector, Dassault Aviation recorded an order intake of €3.3 billion (against €2.7 billion in 2018), the bulk of which (€2.6 billion) was for France and includes the integrated support contract for the French Rafale over the next 10 years and an additional order for supplemental development and integration work concerning communications for the F4 standard of the aircraft. Net sales shot up 44 percent to €7.3 billion due to the record number of 26 Rafales delivered in 2019. CEO Eric Trappier said that in 2020 Dassault expected to deliver 13 Rafales and he saw a tendency of governmental authorities to buying the company's Falcon business jet for surveillance and reconnaissance missions. Trappier said that in 2020 the company would continue to try and export the Rafale and was notably working on the Finnish and Swiss fighter competitions. Both countries are expected to make their decisions in 2021. https://www.defensenews.com/global/europe/2020/02/28/french-defense-firms-fete-formidable-profits-in-2019

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  December 18, 2018 | International, Aerospace

  China is driving use of armed drones in Mideast, says British think tank

  By: Zeina Karam, The Associated Press BEIRUT — The use of armed drones in the Middle East, driven largely by sales from China, has grown significantly in the past few years with an increasing number of countries and other parties using them in regional conflicts to lethal effects, a new report said Monday. The report by the Royal United Services Institute, or RUSI, found that more and more Mideast countries have acquired armed drones, either by importing them, such as Jordan, Iraq, Saudi Arabia and the United Arab Emirates, or by building them domestically like Israel, Iran and Turkey. China has won sales in the Middle East and elsewhere by offering UAVs at lower prices and without the political conditions attached by the United States. The Associated Press reported earlier this year that countries across the Middle East locked out of purchasing American-made drones are being wooed by Chinese arms dealers, helping expand Chinese influence across a region vital to American security interest. It noted the use of Chinese armed drones across Mideast battlefields, including in the war on Yemen, employed by the Emirati Air Force. Iran has also violated Israeli airspace with armed UAVs from bases in Syria, provoking armed Israeli response on the suspected bases. The RUSI report, titled “Armed Drones in the Middle East: Proliferation and Norms in the Region,” said that by capitalizing on the gap in the market over the past few years, Beijing has supplied armed drones to several countries that are not authorized to purchase them from the U.S., and at a dramatically cheaper price. "China, a no-questions-asked exporter of drones, has played and is likely to continue playing a key role as a supplier of armed UAVs to the Middle East," it said. The report explored where and how each of the states have used their armed drones and whether they have changed the way these countries approach air power. It found that Iran, the UAE and Turkey all changed the way they employ air power after they acquired armed drones. For Turkey and the UAE, armed drones enabled them to conduct strikes in situations where they would not have risked using conventional aircraft, it said. Iran developed armed drones from the outset specifically to project power beyond the reach of its air force, which is hamstrung by obsolete aircraft and sanctions, the report added. The report said it remains to be seen whether and how the loosening of restrictions on the export of armed drones by the Trump administration will alter dynamics in the region. The administration in April permitted U.S. manufacturers to directly market and sell drones, including armed versions, although the government must still approve and license the sales. Aniseh Bassiri Tabrizi, who authored the report along with Justin Bronk, said proliferation of armed drones in the Middle East is unlikely to stop and could accelerate despite changes introduced by the U.S. administration. “Over the past two years the sales have increased massively and they are likely to increase even more,” she said. “This kind of collaboration is just going to grow especially in cases where countries don't have the capacity to build them themselves.” https://www.defensenews.com/unmanned/2018/12/17/china-is-driving-use-of-armed-drones-in-mideast-says-british-think-tank

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  January 16, 2020 | International, Land

  US Army cancels current effort to replace Bradley vehicle

  By: Jen Judson WASHINGTON — The U.S. Army is taking a step back on its effort to replace its Bradley Infantry Fighting Vehicle after receiving only one bid in its competitive prototyping program, but this does not mean the end of the road for the future optionally manned fighting vehicle, service leaders told reporters Jan. 16 at the Pentagon. Until now, the Army has been tight-lipped ever since it appeared the competitive effort was no longer competitive, as the service had received only one prototype submission. “Today the U.S. Army will cancel the current solicitation for the Section 804 Middle Tier acquisition rapid prototyping phase of the [optionally manned fighting vehicle]. Based on feedback and proposals received from industry, we have determined it is necessary to revisit the requirements, acquisition strategy and schedule moving forward,” said Bruce Jette, the Army's acquisition chief. “Since its inception, the OMFV program has represented an innovative approach to Army acquisition by focusing on delivering an essentially new capability to armored brigade combat teams under a significantly reduced timeline compared to traditional acquisition efforts. The Army asked for a great deal of capability on a very aggressive schedule and, despite an unprecedented number of industry days and engagements to include a draft request for proposals over a course of nearly two years, all of which allowed industry to help shape the competition, it is clear a combination of requirements and schedule overwhelmed industry's ability to respond within the Army's timeline,” Jette said. “The need remains clear. OMFV is a critical capability for the Army, and we will be pressing forward after revision." In October, the Army ended up with only one bidder in the OMFV competition — General Dynamics Land Systems. The service had planned to hold a prototyping competition, selecting two winning teams to build prototypes with a downselect to one at the end of an evaluation period. Defense News broke the news that another expected competitor — a Raytheon and Rheinmetall team — had been disqualified from the competition because it had failed to deliver a bid sample to Aberdeen Proving Ground, Maryland, by the deadline. A bellwether for what was to come in the prototyping competition happened earlier in the year when BAE Systems, which manufactures the Bradley, decided not compete, Defense News first reported. And, according to several sources, Hanwha also considered competing but decided against the opportunity. The CEO of BAE Systems' U.S.-based business, Jerry DeMuro, told Defense News in a recent interview that the company didn't regret its decision not to pursue OMFV as the requirements and schedule were previously laid out, but said it continues to talk to the Army about future opportunities. “It was a very challenging program,” DeMuro said. “It always comes down to three things: requirements, schedule and funding. The schedule was very, very aggressive, especially early on, and at the same time trying to get leap-ahead technologies. There's a little bit of dichotomy there. “The requirements that were being asked for was going to require, in our estimation, significantly more development that could not be done in that time frame and significantly more capital than the Army was willing to apply.” Jette said the Army had a large number of vendors interested in the effort, hosted 11 industry days and had a number of draft requests for proposals on the street, but, he said, “it's always a challenge for industry. I was on the outside two years ago, and you get an RFP in after the discussions — it still cannot align with what you thought, and that is what you have to respond to is the RFP.” The acquisition chief believes what happened in this case is there was “a large number interested, they started paring down, which started causing us some uncertainty about the competition, but we still had viable vendors in. And when you get out to actually delivering on those requirements, we had one vendor who had challenges meeting compliance issues with delivery, and the second vendor had difficulty meeting responsive issues, critical issues within the requirement — not knowing how to fulfill that.” When pressed as to whether GDLS met the requirements with its bid sample, the Army's program executive officer for ground combat systems, Brig. Gen. Brian Cummings, who was present at the media roundtable along with the Next-Generation Combat Vehicle Cross-Functional Team leader Brig. Gen. Ross Coffman, said the Army could not discuss results and findings regarding the company's submission. Several sources confirmed a letter was circulating around Capitol Hill from GDLS to the Army secretary that strongly urged the service to continue with the program without delay. So now it's back to the drawing board to ensure the Army gets the prototyping program right. Jette took pains to stress that the OMFV effort is not a failed program with the likes of Comanche, Future Combat Systems, Crusader or the Armed Reconnaissance Helicopter. “This is a continuing program. This is an initial effort at trying to get to a programmatic solution yielded, input that we needed to evaluate, which said we needed to revise our approach, not abandon the program or that it was a failure.” Some major failed programs in the past, Jette noted, were canceled after spending large amounts of money and still moving along even though problems were identified as the service proceeded. Crusader cost about $2 billion, Comanche about $6.9 billion and Future Combat Systems about $19 billion, Jette said. “We've spent a very small amount of money in trying to get to where we are, and in fact a good bit of the technology development that was part of the assessment phase is still totally recoverable," he added. Army Futures Command chief Gen. Mike Murray told the same group of reporters he is hesitant to call OMFV a program because it's a prototyping program, not a program of record. “We are still committed to this. This is like a tactical pause,” he said. The effort so far “gave us a great deal of clarity in understanding what is truly doable,” Jette noted. Army leaders said they would be unable to estimate how long its renewed analysis on the program might take before proceeding with a new solicitation to industry, or what that would mean for the program's schedule in its entirety. The original plan was to field OMFV in 2026. Last month, Congress hacked funding for the OMFV prototyping program, providing $205.6 million in fiscal 2020, a reduction of $172.8 million, which would have made it impossible to conduct a competitive prototyping effort. What happens to that funding or congressional support for the overall program is unclear. While sources confirmed to Defense News in early October that the failure with the OMFV prototyping effort revealed rifts between the acquisition community and the Army's new modernization command, Army Futures Command, Jette said while there is a bit of “scuffing here and there" the two organizations are working together “much better.” Murray added it is his view that the acquisition community and Army Futures Command is moving forward as “one team” with “one goal in mind.” https://www.defensenews.com/land/2020/01/16/army-takes-step-back-on-bradley-replacement-prototyping-effort/