January 27, 2021 | International, Land
GLOBAL BUSINESS EDITOR
JANUARY 26, 2021 02:51 PM ET
Raytheon Technologies executives told investors Tuesday that it expects the Biden administration to block at least one arms deal to a Middle Eastern ally as the U.S. shifts its weapons export policy.
Raytheon CEO Greg Hayes, speaking on the company's quarterly earnings call, said Raytheon has removed from its books a $519 million projected sale of an “offensive weapon system” to a “customer in the Middle East...we can't talk about.”
On the same call, CFO Toby O'Brien said the sale involves an “offensive munition.”
The scale of the deal indicates that the execs were referring to the planned sale of some 7,500 Paveway bombs to Saudi Arabia. Last April, Raytheon said in a regulatory filing that its arms sales could be hurt by lawmakers' concerns about Riyadh's role in Yemen's civil war and about the Saudi crown prince's involvement in the murder of a U.S.-based Saudi journalist. Still, in December, Bloomberg reported that the Trump administration was moving ahead with the sale.
“We had assumed that we were going to get a license to provide these offensive weapon systems to our customer,” Hayes said. “With the change in administration, it becomes less likely that we're going to be able to get a license for this. And so we appropriately decided that we could no longer support the booking of that contract.”
During his Senate confirmation hearing last week, now-confirmed Secretary of State Anthony Blinken said the Biden administration would “end our support for the military campaign led by Saudi Arabia in Yemen.”
Still, Hayes said the company does not anticipate issues selling defensive weapons, like Patriot missile interceptors, and other types of arms in the region.
“Look...peace is not going to break out in the Middle East anytime soon,” Hayes said. “I think it remains an area where we'll continue to see solid growth.”
Similarly, Lockheed Martin CEO Jim Taiclet expected foreign arms sales to remain a priority in the Biden administration.
“As far as international business, including foreign military sales, the tendency of the people in the Biden administration [and] in the president's own statements, reiterate his view that alliances are important that they need to be cultivated, and that they have real value in deterrence and national defense,” Taiclet said. “I do think that we'll have a more open environment for [foreign military sales] and direct commercial sales to our international partners.”
Taiclet said foreign weapon sales are a way to generate American jobs and stimulate the U.S. economy.
“If jobs and the economy are important, the promotion of international defense sales, one would surmise, would also be important,” Taiclet said Tuesday morning on Lockheed's quarterly earnings call.
While arms sales create jobs growth, a 2019 Center for International Policy report said those claims, particularly during the Trump administration, were greatly exaggerated.
Still Taiclet, a former U.S. Air Force pilot, said arms sales are a way to deepen relationships with an ally.
“I can tell you that there's no better way to get a tighter bond with an ally than sell them jet fighter aircraft,” he said. “All the way back in the mid-[19]80s, when I was in pilot training, we had Saudis in our class, for example.”
September 1, 2022 | International, Aerospace, Naval, Land, C4ISR, Security, Other Defence
Letting SBIR expire would have existential consequences for the U.S. Department of Defense and the tech industry serving it.
August 12, 2020 | International, Naval
August 11, 2020 - BAE Systems has received an $83.5 million contract from the U.S. Navy to modernize the guided-missile destroyers USS Carney (DDG 64) and USS Winston S. Churchill (DDG 81). The modernization work will be performed sequentially by the company's shipyard in Jacksonville. The contracts include options that, if exercised, would bring the cumulative value to $211.6 million. This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20200811005766/en/ The USS Carney will be first in the shipyard, arriving in September 2020. The 23-year-old ship just returned from a six-year operational period in Rota, Spain, and will undergo extensive repair and upgrade work that will take more than 400 days to complete. The shipyard will drydock the ship and perform maintenance of the underwater hull, renovation of crew habitability spaces and upgrades to shipboard systems. The modernization is scheduled to be completed in November 2021. The Winston S. Churchill will undergo a 390-day maintenance period when the ship arrives in June 2021. The shipyard's work aboard the 18-year-old ship will include drydocking, replacement of steel structures onboard and support of the electronic systems upgrades. The modernization of the Winston S. Churchill is scheduled to be completed in July 2022. “The modernization work aboard the Carney and Winston S. Churchill are significant for our Jacksonville maritime team and important for the service lives and mission capability of these combatants,” said Tim Spratto, general manager of BAE Systems Jacksonville Ship Repair. “The back-to-back sequencing of work is efficient and beneficial for our employees, our subcontractors and our Navy customer.” BAE Systems' Jacksonville shipyard has posted jobs and is expecting to hire workers in a number of trades, including welders, pipefitters, electricians, and painters, over the next two years to work on the two destroyers and for its ongoing repair and modernization work on other ships. The award of these two ships will also provide work for our team of subcontractor partners and third-party vendors in the port. Commissioned in 1996, the USS Carney is named after Admiral Robert Carney, who served as chief of naval operations during the Eisenhower administration. The USS Winston S. Churchill is named after the renowned British prime minister and was commissioned in 2001. BAE Systems is a leading provider of ship repair, maintenance, modernization, conversion, and overhaul services for the Navy, other government agencies, and select commercial customers. The company operates four full-service shipyards in California, Florida, Hawaii and Virginia, and offers a highly skilled, experienced workforce, eight dry docks/marine railways, and significant pier space and ship support services. For information about company jobs, visit www.jobs.baesystems.com View source version on businesswire.com: https://www.businesswire.com/news/home/20200811005766/en/ (Photo credit: BAE Systems)
July 14, 2020 | International, Aerospace
By: Valerie Insinna WASHINGTON — The Air Force has officially placed an order for its first batch of F-15EXs, awarding Boeing a contract on Monday that puts a ceiling value for the entire program close to $23 billion. The first delivery order, which has a not-to-exceed value of about $1.2 billion, covers the first lot of eight F-15EX fighter jets, as well as support and one-time, upfront engineering costs. The contract award is a massive win for Boeing and gives a second life for the F-15 production line in St. Louis, Mo. After years of urging the Air Force to consider an advanced version of the F-15 as a complementary capability to Lockheed Martin's F-35, Boeing found an ally in the Defense Department's Cost Assessment and Program Evaluation office, which in 2019 forced the service to purchase F-15EX planes in order to build capacity. Although Air Force leaders at the time said that the service would have preferred funds to buy additional fifth generation planes like the F-35, officials now say that buying new F-15s is the quickest path for replacing aging Air National Guard F-15C/Ds that are reaching the end of their service lives. “The F-15EX is the most affordable and immediate way to refresh the capacity and update the capabilities provided by our aging F-15C/D fleets,” Gen. Mike Holmes, Air Combat Command commander, said in a statement. “The F-15EX is ready to fight as soon as it comes off the line.” The first two F-15EX aircraft are already being manufactured and will roll off the production line early next year, the company said in a news release. They will initially be based at Eglin Air Force Base, Fla., for testing, with the remaining six aircraft set to be delivered to the base in fiscal year 2023, the Air Force said. Along with the first eight F-15EXs, which were approved in the fiscal year 2020 budget, the Air Force has requested 12 F-15EXs in FY21 and plans to ask for 64 jets from FY22 to FY25. The service could buy as many as 144 aircraft, according to Boeing. The Air Force has not decided which bases will be the first to receive F-15EX jets, with the service adding in its news release that “the Strategic Basing Process is in work to determine the fielding locations for subsequent aircraft lots.” The F-15EX will be a two-seat jet with fly-by-wire controls, the new Eagle Passive Active Warning Survivability System electronic warfare system, an advanced cockpit, and new mission systems. But according to the Air Force, the most significant upgrade comes in the form of an open mission systems architecture that will allow the service to more rapidly update the F-15′s software. Another major advantage of purchasing additional F-15s is the aircraft's payload capacity, which will allow it to carry and launch hypersonic missiles at standoff distances. “The F-15EX is the most advanced version of the F-15 ever built, due in large part to its digital backbone,” said Lori Schneider, Boeing F-15EX program manager. “Its unmatched range, price and best-in-class payload capacity make the F-15EX an attractive choice for the U.S. Air Force.” Monday's announcement follows a firm, fixed-price contract worth up to $101 million that was awarded to General Electric in late June for the first lot of F-15EX engines. Under the contract, GE will provide “F110-GE-129 engines, including installs and spares, and modernized engine monitoring system computers,” the department stated. https://www.defensenews.com/air/2020/07/13/heres-how-much-money-boeing-is-getting-to-build-the-new-f-15ex/