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June 11, 2019 | International, Aerospace, Security

Why the new Raytheon Technologies will eschew platforms for new technology development

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WASHINGTON — “Platform agnostic.”

It's a term getting a lot of play from United Technologies CEO Greg Hayes and Raytheon CEO Tom Kennedy, in the wake of this weekend's surprise announcement that the two companies would be merging into a new firm,known as Raytheon Technologies Corporation.

Neither company works as a platform producer, eschewing the production of aircraft or ground vehicles and instead focusing on the technology that makes them work. It's a business model that has produced well for both firms, and in a Monday interview with Defense News, the two CEOs made it clear they see no need to deviate now.

“One of the first and foremost things we absolutely agree on is, we want to be platform agnostic,” Hayes said, noting that UTC sold off its Sikorsky helicopter unit almost five years ago because “we didn't like the programmatic risk associated with platforms.”

“We'll supply all the content and all the systems, all of the offensive, defensive capabilities necessary to make the system successful, but we really think it's important that we remain agnostic among the platform providers,” Hayes added.

Said Kennedy, “Neither of us essentially develop platforms or sell platforms. Why that's important is, really, the amount of capital that you have to go and spend in maintaining and creating these platforms kind of takes your eye off the ball relative to investing in technology moving forward. So that was a big feature, that both companies are platform agnostic.”

Instead, both men said the new firm will remains focused on developing high-end technologies which can be inserted on, or in, platforms developed by the other major defense primes. With that goal in mind, the company is preparing to spend $8 billion in R&D funds in the year following its merger.

When the merger is completed in early 2020, Kennedy will become chairman of the board, with Hayes serving as CEO. Two years later, Kennedy will step down, with Hayes adding the chairman title.

One area Kennedy highlighted as having good synergies is hypersonic weapons, a major interest for the Pentagon. Raytheon has already been working on hypersonic missiles, including the guidance and control systems, but UTC's experience with propulsion and materials science might be able to help deal with a specific challenge for Raytheon's weapon designers.

“It just turns out when you're flying at Mach 5, you really increase your temperature on all your surfaces," Kennedy said. "If you have a propulsion system, the air is coming in at such a high speed, that creates a significant amount of heat; it has to be dissipated in a very efficient way,” Kennedy said. “And one of the areas that the United Technologies has, really based in the Pratt & Whitney guys, is all the technology that they've developed over the years in working very high temperatures internal to their turbine engines,” he continued. “So not only do they have, I would call it the heat management capabilities, but also the material science to go implement those.”

Hayes identified two areas where shared R&D will have a near-term impact, and they underline the benefit of having a new company that will be roughly 50-50 defense and non-defense business.

The first is on aircraft control systems, where each company has technologies that can be brought to bear for the FAA's next-generation air traffic control networks. The second comes in the form of cybersecurity.

“I think Raytheon is second to none as it relates to cyber, and we view this as a core competency that can benefit the entire commercial aerospace ecosystem,” Hayes said. “Not just the connected aircraft, which is probably the first order of business, but the whole ecosystem. How do you protect passenger data, how do you protect the equipment that's on the ground? How do you protect the airplane while it's flying?

“I think we'll see that shortly in the marketplace.”

https://www.defensenews.com/industry/2019/06/10/why-the-new-raytheon-technologies-will-eschew-platforms-for-new-technology-development/

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    NAVY DoD Marine Constructors JV, Napa, California (N62473-21-D-1403); The Dutra Group, San Rafael, California (N62473-21-D-1404); Granite-Healy Tibbitts JV, Watsonville, California (N62473-21-D-1405); Manson Construction Co., Seattle, Washington (N62473-21-D-1406); Marathon Construction Corp.,* Lakeside, California (N62473-21-D-1407); R.E. Staite Engineering Inc.,* San Diego, California (N62473-21-D-1408); Reyes Construction Inc., Pomona, California (N62473-21-D-1409); and TNT Constructors, Bremerton, Washington (N62473-21-D-1410), are each awarded a firm-fixed-price, indefinite-delivery/indefinite-quantity multiple-award construction contract for new construction, repair and renovation of waterfront facilities at various government installations located in the Naval Facilities Engineering Systems Command Southwest area of responsibility. These eight businesses may compete for task orders under the terms and conditions of the awarded contract. 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Future task orders will be primarily funded by operation and maintenance (Navy); Navy working capital; and military construction (Navy) funds. Work will be performed at various government installations in states including, but not limited to, California (90%); Arizona (6%); Nevada (1%); Utah (1%); Colorado (1%); and New Mexico (1%), and will be completed by December 2026. Fiscal 2021 operation and maintenance (Navy) funds in the amount of $5,000 will be obligated to each awardee at time of award and will expire at the end of the current fiscal year. This contract was competitively procured via the beta.SAM.gov contract opportunities website, with 15 proposals received. The Naval Facilities Engineering Systems Command, Southwest, San Diego, California, is the contracting activity. TechFlow Mission Support LLC, doing business as EMI Services, Idaho Falls, Idaho, is awarded a maximum value $128,970,744 indefinite-delivery/indefinite-quantity contract for base operation support services at Naval Air Station Patuxent River, Maryland; Webster Field, St. Inigoes, Maryland; Solomons Annex, Solomons, Maryland; and Point Lookout, St. Mary's County, Maryland. Work will be performed in St. Mary's County, Maryland (92%); and Calvert County, Maryland (8%), and is expected to be complete by March 2029. Fiscal 2021 operation and maintenance (Navy) funds in the amount of $13,269,831 for recurring work will be obligated under the initial task order at time of award and will expire at the end of the current fiscal year. 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This contract provides for systems engineering services for assigned Global Radio Frequency Intelligence Networks related technologies and systems in support of the Naval Air Warfare Center Aircraft Division Webster Outlying Field Integrated Command, Control and Intel Division. Work will be performed in Saint Inigoes, Maryland, and is expected to be completed in April 2026. No funds will be obligated at the time of award. Funds will be obligated on individual task orders as they are issued. This contract was competitively procured via an electronic request for proposal; one offer was received. The Naval Air Warfare Center Aircraft Division, Patuxent River, Maryland, is the contracting activity (N00421-21-D-0010). Kay and Associates Inc., Buffalo Grove, Illinois, is awarded a $69,515,496 cost-plus-fixed-fee, cost reimbursable modification (P00012) to previously awarded contract N00421-17-C-0044. This modification exercises an option to procure maintenance and support services for F/A-18 aircraft and associated equipment in support of the government of Kuwait. Work will be performed in Kuwait, and is expected to be completed in January 2022. Foreign Military Sales funds in the amount $69,515,496 will be obligated at time of award, none of which will expire at the end of the current fiscal year. The Naval Air Warfare Center, Aircraft Division, Patuxent River, Maryland, is the contracting activity. Teledyne Brown Engineering Inc., Huntsville, Alabama, is awarded a $39,211,704 firm-fixed-price modification to previously awarded contract N00024-19-C-6402 to exercise options for the production of MK11 shallow water combat submersibles. Work will be performed in Huntsville, Alabama, and is expected to be completed by September 2024. Foreign Military Sales (country name withheld per international agreement) funding in the amount of $39,211,704 will be obligated at time of award and will not expire at the end of the current fiscal year. The Naval Sea Systems Command, Washington, D.C., is the contracting activity. Raytheon Co., Keyport, Washington, is awarded a $16,095,857 modification to previously-awarded indefinite-delivery/indefinite-quantity requirements contract N61331-17-D-0001 to exercise options for maintenance and support for the AN/AQS-20 sonar mine detecting set. Work will be performed in Portsmouth, Rhode Island (65%); Keyport, Washington (30%); and Panama City, Florida (5%), and is expected to be completed by January 2022. No funds will be obligated at time of award. Funds will be obligated on individual task orders as they are issued. The Naval Surface Warfare Center, Panama City Division, Panama City, Florida, is the contracting activity. Heffler Contracting Group,* El Cajon, California, is awarded a maximum value $15,000,000 firm-fixed-price, indefinite-delivery/indefinite quantity contract for specialty trade work, additions, alterations and repairs at various facilities located at Travis Air Force Base, California. No task orders are being issued at time of award. The work to be performed will be primarily design-bid-build (fully designed) task orders or task orders with minimal design effort (e.g. shop drawings). Projects may include, but are not limited to, specialty trade work. The work performed may include new work, additions, alterations, maintenance and repairs. Future task orders will be primarily funded by operation and maintenance (Navy) funds. Work will be performed at Travis Air Force Base, California, and is expected to be completed by January 2026. Fiscal 2021 operation and maintenance (Navy) funds in the amount of $2,000 will be obligated at time of award in order to meet the minimum guarantee and will expire at the end of the current fiscal year. This contract was competitively procured via the beta.SAM.gov website, with nine proposals received. The Naval Facilities Engineering Systems Command, Southwest, San Diego, California, is the contracting activity (N62473-21-D-1018). Agile-Bot II LLC,* Reston, Virginia, is awarded a $14,075,424 cost-plus-fixed-fee contract for advanced cyber support services in support of the Marine Corps Cyberspace Operations Group. This one-year contract includes four one-year option periods which, if exercised, would bring the cumulative value of this contract to an estimated $72,996,224. All work will be performed in Quantico, Virginia. The period of performance of the base period is from Jan. 14, 2021, through Jan. 13, 2022. If all options are exercised, the period of performance would extend through Jan. 13, 2026. Fiscal 2021 operation and maintenance (Marine Corps) funds in the amount of $2,991,443 will be obligated at the time of award. This contract was competitively procured via request for proposal N66001-18-R-0011 published on the Federal Business Opportunities website and the NAVWAR e-Commerce Central website. Five offers were received and one was selected for award. The Naval Information Warfare Center, Pacific, San Diego, California, is the contracting activity (N66001-21-C-0043). Electrical Equipment Co.,* Norfolk, Virginia, is awarded a $10,976,873 firm-fixed-price, indefinite-delivery/indefinite-quantity contract. This contract provides for the delivery of up to a maximum quantity of 620 XVR16 and 380 XVR19 Versa Module Eurocard Single Board computers; four annual XVR19 Open Linux software development kit maintenance licenses; and 120 RES-3000 Ethernet Switch System components for multiple AN/UPX-24(V) Interrogator Set and AN/UPX-46(V) Interrogator System projects in support of Naval Air Warfare Center, Aircraft Division, Combat Integration and Identification Systems. Work will be performed in Norfolk, Virginia, and is expected to be completed in January 2026. No funds will be obligated at the time of award; funds will be obligated on individual orders as they are issued. This contract was competitively procured via an electronic request for proposal; one offer was received. The Naval Air Warfare Center, Aircraft Division, Lakehurst, New Jersey, is the contracting activity (N68335-21-D-0047). MISSILE DEFENSE AGENCY L3Harris Technologies Inc., Fort Wayne, Indiana, is being awarded a firm-fixed-price prototype award with a total value of $121,634,954 through the Missile Defense Agency's authority under 10 U.S. Code § 2371b. This prototype award was competitively solicited among awardees of the Hypersonic and Ballistic Tracking Space Sensor Phase IIa effort, which was competitively awarded as a Prototype Other Transaction pursuant to 10 U.S. Code § 2371b. Four proposals were received. Under this award, the performer will provide the Missile Defense Agency's Hypersonic and Ballistic Tracking Space Sensor program with an on-orbit prototype demonstration, culminating with launch and early orbit testing. The work will be performed in Fort Wayne, Indiana, with an estimated completion date of July 14, 2023. Fiscal 2020 research, development, test and evaluation funds in the amount of $25,000,000 will be obligated at the time of award. 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