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August 4, 2020 | International, Land

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


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.”

On the same subject

  • Pentagon reports boost in predatory foreign investment to US tech firms amid pandemic

    May 7, 2020 | International, C4ISR

    Pentagon reports boost in predatory foreign investment to US tech firms amid pandemic

    Valerie Insinna Since the coronavirus pandemic began, the Defense Department has seen a small increase in predatory foreign investment in U.S. companies, such as small drone manufacturers, the Pentagon's head of industrial policy said Wednesday. “In general terms, there has been of an uptick, but it's always been pretty high,” Jennifer Santos, deputy assistant secretary of defense for industrial policy, said Wednesday during the C4ISRNET Conference. The Pentagon has become increasingly concerned about what it calls “adversarial capital” — a tactic whereby foreign nations, particularly China, make investments into U.S. technology startups that are part of the defense market. Once those countries make their investments, they could own or have access to unique American technologies, while the Pentagon loses its own access due to security considerations. With the U.S. economy increasingly fragile due to COVID-19, the Defense Department must be vigilant about potential risk to American companies, Santos said. “We simply cannot afford during this period of economic uncertainty the loss of American know-how in critical tech.” But Santos stopped short of saying the uptick in predatory foreign investment was a direct result of the pandemic, instead noting that the Defense Department recently expanded its existing tools to monitor adversarial capital. One tool, known as the Committee on Foreign Investment in the United States, or CFIUS, allows the government to block a foreign investment attempt on national security grounds. The jurisdiction of that tool increased in February, so the Defense Department has seen a boost in the number of cases it is tracking, Santos said. “Twenty percent of our [gross domestic product] is foreign direct investment, which is fantastic. But there's some areas where there are threats associated with some of that capital, and we want to protect those industry partners,” she said. Over the past eight weeks, the Pentagon hosted 25 teleconferences with industry to help guide companies that might be experiencing financial distress caused by COVID-19. Some of that outreach, such as a webinar held last week, centered around avoiding adversarial capital, Santos said. While her comments on adversarial capital did not center specifically on the small drone industry, she noted that the pandemic has made supply chain vulnerabilities in that sector more apparent to the department. “The market for UAS [unmanned aerial systems] in the United States is dominated primarily by foreign companies, especially Chinese companies,” she said, adding that Chinese firms hold 97 percent of the small UAS market, with about 75 percent of sales in the U.S. commercial market coming from Chinese drone maker DJI. “U.S. firms have struggled to compete in this drone area,” she said. "Even commercial drones manufactured in the United States often use components made in China. We don't know what the exact effects of COVID will be on this small UAS sector, but I know one thing: We will emerge from this stronger.” Brent Ingraham, the Pentagon's unmanned systems technical director, pointed to the American Drone Security Act currently under proposal by Congress. If passed, the legislation would apply the same security restrictions on UAS used by the Defense Department to the rest of the federal government, which would secure industrial opportunities for U.S. vendors that have a trusted supply chain, he said. As the Defense Department looks to expand its base of small UAS manufacturers, one of the military's legacy providers offered a word of caution. "We as a community are all in favor in faster, cheaper, better, but we need to have an exercise in caution when you do that,” said Gorik Hossepian, AeroVironment's vice president of UAS product line management. “Our past is full of examples of when we do those kinds of things, we tend to sacrifice one versus the other. We need to not lose sight that what we need is a balance.” "At the end of the day, the war fighter at the edge of the battlefield ... needs to have a product that is trusted,” he said. “Members of some of our community, to some extent, have that as some of our DNA — the DNA of working with the end user to solve those problems.”

  • Kratos Receives $30 Million in C5ISR Contract Awards

    July 6, 2020 | International, C4ISR

    Kratos Receives $30 Million in C5ISR Contract Awards

    San Diego, July 2, 2020 (GLOBE NEWSWIRE) -- Kratos Defense & Security Solutions, Inc. (Nasdaq: KTOS), a leading National Security Solutions provider, announced today that it has recently received approximately $30 million in contract awards for Command, Control, Computing, Communication, Combat, Intelligence, Surveillance and Reconnaissance (C5ISR) Systems, focused primarily on missile defense related combat systems. Kratos is an industry leader in the rapid development, demonstration and fielding of affordable leading technology products and solutions in support of the United States and its allies' national security missions. Kratos C5ISR Modular Systems Business is an industry leader in manufacturing, producing and delivering C5ISR Systems for Missile, Radar, High Power Directed Energy, Ballistic Missile Defense, Unmanned Aerial Vehicle, Chemical, Biological, Radiation, Nuclear and High Explosive (CBRNE) and other programs and applications. Work under these recent program awards will be performed at secure Kratos manufacturing and production facilities. The majority of the performance under these contract awards will be completed over the next 24 months. Due to customer, competitive and other considerations, no additional information will be provided related to these U.S. National Security related program awards. Tom Mills, President of Kratos C5ISR Business, said, “These recent contract awards to support critical national security related systems and programs are representative of the confidence of Kratos' customers in our ability to meet their mission critical needs and requirements, on schedule and on budget. Our entire organization is proud to support the Department of Defense, other customers, government agencies and the warfighter in the execution of their mission.” Eric DeMarco, President and CEO of Kratos Defense, said, “We believe that these recent contract awards are representative of Kratos' positioning as a disruptive leading technology systems, products and intellectual property company, including our focus on unmanned jet drones, space and satellite communications, microwave electronics, next generation jet engines for tactical systems, missile defense and hypersonic vehicles. At Kratos, affordability is a technology, and we are executing on our plan to be an alternative provider to our DoD and National Security customer base in our key focus areas.” About Kratos Defense & Security Solutions, Inc. Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS) develops and fields transformative, affordable technology, platforms and systems for United States National Security related customers, allies and commercial enterprises. Kratos is changing the way breakthrough technology for these industries are rapidly brought to market through proven commercial and venture capital backed approaches, including proactive research and streamlined development processes. Kratos specializes in unmanned systems, satellite communications, cyber security/warfare, microwave electronics, missile defense, hypersonic systems, training and combat systems, and next-generation turbojet and turbo-fan engine development. For more information, go to Notice Regarding Forward-Looking Statements Certain statements in this press release may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are made on the basis of the current beliefs, expectations and assumptions of the management of Kratos and are subject to significant risks and uncertainty. Investors are cautioned not to place undue reliance on any such forward-looking statements. All such forward-looking statements speak only as of the date they are made, and Kratos undertakes no obligation to update or revise these statements, whether as a result of new information, future events or otherwise. Although Kratos believes that the expectations reflected in these forward-looking statements are reasonable, these statements involve many risks and uncertainties that may cause actual results to differ materially from what may be expressed or implied in these forward-looking statements. For a further discussion of risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to the business of Kratos in general, see the risk disclosures in the Annual Report on Form 10-K of Kratos for the year ended December 29, 2019, and in subsequent reports on Forms 10-Q and 8-K and other filings made with the SEC by Kratos. Press Contact: Yolanda White 858-812-7302 Direct Investor Information: 877-934-4687 View source version on Kratos Defense & Security Solutions, Inc.:

  • As Defender 2020 drill winds down, US Army plans for 2021 edition

    July 13, 2020 | International, Land

    As Defender 2020 drill winds down, US Army plans for 2021 edition

    By: Aaron Mehta WASHINGTON — As the last portions of the altered Defender 2020 exercise kick into gear, the U.S. Army is beginning to plan its 2021 edition, a top general said Thursday. Speaking at a Defense News virtual panel on trans-Atlantic alliances Brig. Gen. Sean Bernabe, deputy commander of U.S. Army Europe, expressed confidence that Defender 2021 will be able to happen despite the ongoing coronavirus pandemic. “We've been continuing to look forward now that we've gained some confidence that we can train large-scale, collective [military exercises] in this environment,” Bernabe said. “We've been looking further and further forward. As we speak, we're planning exercise Defender Europe 2021, to take place in the late spring, early summer of 2021, focused in the Black Sea and Balkans.” Planning “is underway, again informed by our experiences between March and June. Having validated that we can do it, we're confident that we'll figure it out in partnership with our allies,” he added. “I feel confident that we will [be able to] maintain readiness and interoperability across Europe, despite COVID, regardless of how long it may be a part of our operating environment.” Bernabe predicted the 2021 exercise will likely be smaller than 2020′s planned version, which should be no surprise. Defender 2020 was billed as the third-largest military exercise in Europe since the end of the Cold War, a major test of the United States' ability to move stateside forces to locations across Europe, including Poland, the Baltics, some Nordic nations and Germany. A total of 20,000 soldiers were expected to participate. However, the COVID-19 outbreak forced the Army to hit pause on the exercise in March just as it was starting. Several smaller, related drills were canceled outright, and U.S. forces were sent back home. A smaller associated exercise picked up again in June. Bernabe's comments came just hours before the Army announced that a combined arms battalion would deploy to Europe between July 14 and Aug. 22 as part of the “final phase” of the modified Defender 2020 exercise. The deployment will involve 550 soldiers from the 2nd Battalion, 12th Cavalry Regiment, 1st Armored Brigade Combat Team, 1st Cavalry Division out of Fort Hood, Texas, with the 1st Cavalry Division Headquarters in Poznan, Poland, serving as mission command. Approximately 55 Abrams tanks and Bradley Infantry Fighting Vehicles will take part. The tanks will be equipped with the Trophy active protection system so the Army can “assess and experience the dynamics of moving and installing the system in a field environment.” At the end of June, the European Union put citizens of the United States on a list of countries barred from traveling to EU member states due to the continued spread of COVID-19. However, military movements are exempt from that rule, and Bernabe believes the Army has a good plan in place for the intake of forces into Europe. “To be good neighbors, we are using some very, I'd say, aggressive approaches to make sure that we are screening and testing for COVID as personnel arrive,” he said. “Make sure that we're putting in the mandatory 14 days' [quarantine], making sure that we continue screening, we wear masks, we practice physical distancing to make sure that we're not bringing infection into Europe while we focus on maintaining the military readiness. “So thankfully we've worked with our host nations to continue to flow personnel into and out of Europe.”

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