News

Michael Bruno Companies have good quarters and bad quarters, but rarely does a whole industry sound like it just got sucker-punched. That's what the next few weeks will be like in the aerospace and defense sector, and for sure there will be headlines describing industrial carnage as the industry gasps for air and works to recover after COVID-19. The truth is the aerospace and defense (A&D) supply chain suddenly is far too large for what is needed, maybe by a quarter or a third of excess capacity. As a result, quick or methodical cutbacks in manufacturing and services are expected throughout the syndicates that make airliners, business jets and other aircraft. As public companies report their latest quarterly financial results in late April and May, they will have to address the year ahead and offer insight into their response plans. Unfortunately, business as usual prior to COVID-19 is not expected until 2022 or later, according to numerous analysts and advisors. And that is just too long to carry extra financial costs, which means all levels will feel pain. “The COVID-19 decline is a serious risk for commercial OEM plays—Boeing, Spirit AeroSystems, Allegheny Technologies, Hexcel, Howmet Aerospace, Triumph Group and Carpenter Technology,” Cowen analysts say. “Aftermarket ‘relative safe havens' Honeywell International, Heico and TransDigm Group also face stiff near-term headwinds, with more serious risks at General Electric.” If OEMs and their Tier 1 and 2 suppliers are already cutting their workforces, slashing executive salaries and suspending shareholder returns—as dozens have announced since the novel coronavirus began sweeping through the U.S. in March—then it is easy to imagine that much lower tiers with their even thinner margins could face existential reckonings. “People who didn't plan for it were unreasonably naive,” asserts Avitas consultant Adam Pilarski, a longtime expert who espoused a bearish view on commercial aviation long before the Boeing 737 MAX crisis started gumming up business models. “There is no magic potion here. You will have less production.” While Pilarski's comment may come across as harsh, it accurately describes the depth of the coming paradigm shift for commercial aviation. Yes, perhaps it was too much to have asked OEMs and suppliers to model for a 95% collapse in passenger air traffic and two-thirds of large commercial aircraft fleets getting parked—including brand-new deliveries. But practically no one seemed to imagine simultaneous cuts to new orders, standing backlogs and aftermarket revenue streams. Indeed, Pilarski was one of the few who envisioned an environment with much less than the traditional 5% annual growth in air traffic. That is now changing: Airbus has revealed narrowbody and widebody production rate cuts of about a third, and Boeing is expected to follow suit any day. According to Credit Suisse analysts, such sudden rate changes will have a materially negative impact on the supply chain because the effect is exponential. “[The supply chain] will need to cut production by much more as Airbus consumes its inventories—for instance, potentially going to rate 20 on the A320 for some months and ramping up again to 40,” the Credit Suisse analysts say. Boeing's inventory—including roughly 800 MAXs that are backed up with its customers and supplier Spirit AeroSystems and are waiting to join its own fleets—is worse. Still, it is not that simple to look at customers such as Airbus and Boeing and draw a direct line to suppliers to guess their fate. While the vast majority of publicly traded A&D companies have shelved the 2020 forecasts they offered just weeks before, almost no one has outlined new plans. For one thing, few suppliers had even received change orders as of early April, Ken Herbert of Canaccord Genuity says. Here are three factors to watch for in earnings reports to discern how the supply chains will change. First, how much U.S. government aid will companies receive? This is a significant variable, and as of mid-April, we still did not know how much even sector leader Boeing will receive (presuming it does). “Most suppliers we have spoken with are still waiting for more clarity on the exact terms available under the CARES Act,” says Herbert, who has deep ties in the A&D supply chain. Meanwhile, many public companies have been able to tap short-term financing or debt markets to boost liquidity—a testament to their prior investment grades. Second, the supply chain has experienced robust vetting and stress-testing over the past decade. Did it work? Record growth, record mergers and acquisitions, and record private equity involvement have dramatically consolidated industry (for better or worse). Yes, it meant elimination of countless companies, and some smaller survivors remain stressed by technology investments and meager working capital accounts. But top-tier companies have been working to eliminate chokepoints and shore up weak links in their supply chains for the last few years, ironically as they sought to raise rates. Finally, many companies became less susceptible one way or another, especially through revenue diversification (see chart). Take the new Raytheon Technologies, the first supplier to rival its OEM customers in annual sales. Manufacturers elbowed into the aftermarket; commercial providers and defense suppliers tapped into each other's markets; and venture capitalists and billionaire competitors entered into and prodded new technology advances that legacy industry had resisted funding, among other trends. Will this lead to resilience? Some think so. “In many ways, the supply chain is now more mature, diversified and well-positioned to handle this economic downturn versus in 2001 and 2008,” says Alex Krutz, managing director at Patriot Industrial Partners, an advisory firm focused on operations and supply chain. “A large number of suppliers over this last decade have taken significant steps to ensure their long-term success.” There are sure to be industrial casualties as A&D faces its greatest business falloff in history. We should mourn the loss of skilled workers and devoted people who are forced to exit the sector, but there are still new aircraft to build. And there will be supply chains to do it. https://aviationweek.com/aerospace/manufacturing-supply-chain/what-watch-ad-companies-plan-future-covid-19

Par AFP ,publié le 23/04/2020 à 19:52 , mis à jour à 19:52 Paris, 23 avr 2020 - Les industries de défense jugent "fondamental" un plan de relance de l'économie dont elles bénéficieraient face à l'épidémie de coronavirus, mettant en avant les emplois en jeu en France et la concurrence internationale, ont affirmé jeudi leurs représentants. "Nous proposons un plan de relance pour soutenir la base industrielle et technologique de défense à l'image de ce qui avait été réalisé après la crise de 2008 pourtant beaucoup moins forte", a plaidé Stéphane Mayer, président du Conseil des industries de défense française (Cidef) lors d'une audition par les députés de la commission des Forces armées. Il était entendu en tant que président du Groupement des industries françaises de défense et de sécurité terrestres (Gicat) au côté de ses homologues du Gifas (industries aéronautiques et spatiales), Eric Trappier, et du Gican (constructions navales), Hervé Guillou. Le volet défense du plan de relance lancé en 2008 représentait 2,4 milliards d'euros. Il avait notamment donné lieu à la commande d'un porte-hélicoptères supplémentaire, le Dixmude, qui croise aujourd'hui dans les Antilles pour y apporter soutien logistique et matériel sanitaire face à l'épidémie de Covid-19. Un tel plan de relance est aujourd'hui "absolument fondamental", selon eux. "La commande publique est le meilleur moyen de redémarrer l'économie", a jugé Hervé Guillou. "Il faut être capable de relancer notre économie au risque sinon de voir déferler une vague relativement forte de problématiques d'emplois, de problématiques d'activités qui serait désastreuses", a observé Eric Trappier pour le Gifas. Les salariés des industries de défense sont estimés à au moins 165.000 personnes, pour beaucoup très qualifiés et répartis sur l'ensemble du territoire. "Avant de parler de relocalisations, l'industrie de défense est déjà localisée en France, donc un euro dans le budget français va directement dans l'emploi en France et l'export c'est du budget étranger qui donne de l'emploi en France", selon M. Trappier. Le secteur est contributeur net à la balance commerciale, mais fait face à une forte concurrence internationale, notamment d'Allemagne, de Chine ou des États-Unis. "Or, nos principaux concurrents se sont mis dans une situation de redémarrage [de l'activité] qui pourrait très rapidement tuer nos parts de marché", a estimé Hervé Guillou. Entendue par les sénateurs le 10 avril, la ministre des Armées Florence Parly avait affirmé que son ministère, "premier investisseur de l'État", aurait "un rôle particulier à jouer lorsqu'il s'agirait de relancer l'économie française". https://lentreprise.lexpress.fr/actualites/1/actualites/coronavirus-les-industriels-de-defense-plaident-pour-un-plan-de-relance_2124513.html

While some prototype deliveries and field tests are being delayed, Army leaders said, there's enough slack in the schedule that combat units will still get the new tech on time. By SYDNEY J. FREEDBERG JR.on April 23, 2020 at 2:40 PM WASHINGTON: The Army and its contractors are coping with the COVID-19 pandemic so well that the service expects no delay in the fielding of future weapons, the Army Secretary and his two top modernization officials told reporters today. The “rigorous” review of acquisition programs for the 2022 budget request is also still on schedule, Sec. Ryan McCarthy said. “It's just amazing how quickly they've adapted, kept their workforce engaged, and are protecting cost, schedule, and performance on these weapons systems,” said McCarthy, recently returned from a visit to BAE and General Dynamics facilities in Detroit. “Also I'm very proud of Dr. Jette's and Gen. Murray's performance during this crisis, working on things like progress payments for manufacturers, trying to help them get access to small business loans, the managing of second- and third-tier suppliers.” “Right now, all the companies that were closed for any period of time are reopened,” said Assistant Secretary Bruce Jette, the service's civilian acquisition chief. One BAE worker was infected, resulting in a week-long shutdown of a combat vehicle assembly line – you can't weld armor plate over your telephone, Jette noted – but the company has now restarted production with new precautions in place. The company and the union have agreed to give up their traditional week-long shutdown for summer vacation to catch up. The Boeing CH-47 helicopter plant in Philadelphia also shut down for 10 days, Jette reported, but they're back up and running as well. He's most worried about smaller subcontractors, where a single COVID-19 case can force the entire workforce to be quarantined for 14 days, so he's tracking that closely. “I keep track on a daily basis of 63 pages of supply chain [data],” Jette said. “Our industry partners have been really good about opening their books all the way down to their sub-suppliers and keeping us well-informed — they contractually don't have to do that but they have.” Some deliveries of prototypes have been delayed, said Gen. John “Mike” Murray, chief of Army Futures Command. But, so far, those delays are measured in weeks and there's sufficient slack in schedules to catch up later this year, he said, which means programs will proceed to production and fielding on time. What's particularly tricky for the Army is that, after decades of dumping “good ideas” on soldiers only to find they didn't actually work, it's now systematically letting soldiers try out prototypes hands-on. These soldier touchpoints require troops to work together in the field, often side-by-side with contractors who record their feedback and make some fixes on the spot. That's difficult given pandemic precautions – but not impossible. Other types of testing allow a little more social distance, and work from engineering design to budget reviews can take place entirely online. Gen. Murray gave a rundown of key programs: The next flight test of Lockheed Martin's Precision Strike Missile (PrSM) will take place as scheduled on April 30th, Gen. Murray said. “I'm very confident,” he declared, to the point he's already planned his flight to go observe. On the other hand, the third big soldier touchpoint test for the IVAS targeting goggles, scheduled for this summer, has been delayed to the fall. That's not just because of social distancing, Murray said, but also because a Microsoft subcontractor ran into COVID-19 problems (they'll be back in operation this week). Because this would have been the first test of a fully militarized and ruggedized “form factor” of IVAS, which began life as a modified Microsoft HoloLens, it's too important to cut corners, he said. The program will be able to make up the lost time and deliver the final production version to troops on schedule, he said. There's been a six week delay in delivery of the three competiting prototypes for Next Generation Squad Weapon, meant to replace the M249 SAW. Once the weapons arrive, however, the Army will now get them into soldiers' hands in just two weeks, a month faster than originally planned, making up for most of that lost time. Field-testing of one contender for the new FTUAS drone is already underway at Fort Riley, as we've previously reported. Testing of another drone design at Fort Campbell is “a little bit delayed,” Murray said, but should start by the end of the month. The Limited User Test of the IBCS missile defense network has been postponed (again, as we've reported). But the equipment remains in place at White Sands Missile Range in New Mexico, Murray said, software updates continue, and the soldiers who spent months training to operate it will be back to do the test “this summer or early fall.” (The Army also previously announced it would postpone field tests of promising new Robotic Combat Vehicles). “In general,” Jette said, “we don't see any FUEs changing”: That's military jargon for “First Unit Equipped,” the crucial moment when enough of a weapon has been built to equip a significant combat unit. “We are tracking each program,” Jette said, not just the service's top priorities “but all of our over 600 programs, [and] none of them are at risk” of a delay so severe they can't recover. https://breakingdefense.com/2020/04/covid-19-wont-slow-new-army-weapons-mccarthy-murray-jette/

By: Maj. Gen. Larry Stutzriem (ret.) and Douglas Birkey The nation faces a bomber crisis, and it is time to openly acknowledge the scale and scope of the problem. Tasked with deterrence and, if necessary, striking targets around the globe, Air Force crews operating these aircraft afford the nation's security leaders unique options best embodied in the phrase: anytime, anyplace. Despite the criticality of this mission, the Air Force currently operates the smallest, oldest fleet of bombers since its 1947 founding. No other service or ally has this capability, which places an imperative on this finite force. The service's recent announcement that it will be ending its continuous bomber presence in Guam further amplifies the precarious state of bombers. It is a stark warning to senior leaders in the Pentagon, in the executive branch and on Capitol Hill that the Air Force is “out of Schlitz” when it comes to the critical missions they perform. Bombers are unique instruments of power. They can strike targets with large volumes of kinetic firepower without requiring access to foreign bases and without projecting the vulnerability associated with regionally based land or sea forces. The striking power of a single bomber is immense. In fact, B-1Bs flying missions against ISIS in the opening days of Operation Inherent Resolve were able to carry more munitions than that delivered by an entire carrier air wing. Stealth bombers can penetrate enemy air defenses, depriving mobile targets of sanctuary. They can also carry large bunker-buster munitions required to eliminate deeply buried and hardened facilities. Bomber aircraft are also cheaper to operate on a per-mission basis when compared to alternate options, like ships, large packages of smaller strike aircraft or standoff missiles. The erosion of the bomber force is no secret. At the end of the Cold War, the U.S. Air Force possessed 400 bombers arrayed to fight the Soviet Union. Today, it has just 157, with a plan to cut a further 17 in the fiscal 2021 budget submission. Air Force efforts to modernize the bomber force a decade ago were thwarted within the Department of Defense by an excessive near-term focus on counterinsurgency operations. Bombers are requested by combatant commands on a continual basis given the concurrent threats posed by peer adversaries, mid-tier nations like Iran and North Korea, and hostile nonstate actors. The Air Force knows this mission area is stretched too thin, and that is precisely why in 2018 leaders called for an additional five bomber squadrons in “The Air Force We Need” force structure assessment. Well-understood risk exists with operating a high-demand, low-density inventory for too long. The B-1B force, which makes up over one-third of America's bomber capacity, offers a highly cautionary tale in this regard. In the immediate aftermath of 9/11, the service retired 26 of these aircraft to free up modernization funds, which subsequently were snatched away from the bomber mission area for other uses. For the next two decades, the Air Force flew the B-1B in a nearly continuous string of intense combat deployments. Sustainment funding was under-resourced, which further wore down the B-1B force. Last summer, B-1B readiness rates plummeted below 10 percent — effectively putting them out of commission. As Air Force Global Strike Command Commander Gen. Tim Ray explained: “We overextended the B-1Bs.” It was a toxic formula of too much mission demand and too few airplanes. Air Force leaders continually signaled concern, but their calls for help went unanswered. The normal solution to this sort of a challenge would be straight-forward: Go buy more airplanes. However, operational B-21s will not be in production until the latter 2020s. The Air Force is asking to retire 17 B-1s to free up resources to nurse the remaining aircraft along as a stopgap measure. COVID-19 emergency spending and corresponding downward pressure on future defense spending are only going to aggravate the complexity of this juggling act with mission demand, available force structure and readiness. Whether world events will align with these circumstances is yet to be seen. It was in this context that the Air Force decided to end its continuous bomber presence on Guam. Launched in 2004 to deter adversaries like China and North Korea and to reassure regional allies, the mission has been a tremendous success. It clearly communicated U.S. readiness to act decisively when U.S. and allied interests were challenged. Ending continuous bomber presence in the Pacific now sends the opposite message, just as the region grows more dangerous. This is a decision with significant risk, yet it is an outcome compelled by past choices resulting in a bomber force on the edge. The path forward begins with admitting the nation has a bomber shortfall. Retiring more aircraft exacerbates the problem. Nor is this just an Air Force problem. Bombers are national assets essential to our security strategy and must be prioritized accordingly. If other services have excess funds to invest in ideas like a 1,000-mile-range cannon when thousands of strike aircraft, various munitions and remotely piloted aircraft can fill the exact same mission requirements, it is time for a roles and missions review to direct funding toward the most effective, efficient options. Bombers would compete well in such an assessment. Ultimately, the solution demands doubling down on the B-21 program. There comes a point where you cannot do more with less. Given the importance of bombers to the nation, rebuilding the bomber force is not an option — it is an imperative. Retired U.S. Air Force Maj. Gen. Larry Stutzriem served as a fighter pilot and held various command positions. He concluded his service as the director of plans, policy and strategy at North American Aerospace Defense Command and U.S. Northern Command. He is currently the director of studies at the Mitchell Institute for Aerospace Studies, where Douglas Birkey is the executive director. Birkey researches issues relating to the future of aerospace and national security, and he previously served as the Air Force Association's director of government relations. https://www.defensenews.com/opinion/commentary/2020/04/23/americas-bomber-force-is-facing-a-crisis/

By: Andrew Chuter LONDON — Britain is facing some “distasteful medicine “ in an upcoming defense review, with question marks around money, allies, the industrial base, Defence Secretary Ben Wallace has warned. Giving evidence in a virtual session of the Parliamentary Defence Committee April 22, Wallace said there were some difficult issues to be addressed by a post COVID-19 Britain. “We will have to take some pretty distasteful medicine," he told committee members spread across the country in the first ever virtual session of the committee. "It's not just about sums of money. It is about cultural change — our relationship with our allies, what Britain's ambitions are going to be. Do we want to do everything? Do we want to do less? Do we want to let go of something? Do we want to bank on international consortia every time, or do we want to invest in our industrial base? All those are difficult questions. The defense secretary, who only recently recovered from COVID-19, said changing the culture is going to be as important as the sums of money made available to the Ministry of Defence in the integrated review. The government refers to it as an ‘integrated review' as it involves, defense, security, foreign policy and international development departments. Wallace said that whether the review is uncomfortable or not, his hope is the defense ministry will have a realistic amount of money available to undertake what it recommends. That's rarely been the case in previous reviews over the last 30 years or so, and few people here are expecting much different this time round. The issue is already complicated by the never-ending budget pressure at the MoD. According to the National Audit Office, the government's financial watchdog, the MoD already has a financial black hole for its equipment program of between £3 and £13 billion, or as much as $16 billion. John Louth, an independent defense analyst in the U.K., said one of the big challenges facing the MoD will be putting the procurement roadmap back together post COVID-19. “One of the real challenges will be re-profiling a schedule for procurement," Louth said. Everything is slipping to the right, and re-profiling is going to be difficult, particuarly as many of the programs are interdependent on other programs. That poses a large and difficult challenge within a restricted budget." The economic impact of the COVID-19 pandemic is likely to make more difficult allocation of cash to its various departments and ministeries in the next comprehensive spending review. That's not withstanding the fact that MoD personnel — nearly 3,000 at the last count — have been lauded for their excellent performance assisting the National Health Service and others, carrying out tasks ranging from delivering oxygen to hospitals to setting up and running command and control centers. In particular the MoD has been widely praised for rapidly constructing several field hospitals for COVID-19 sufferers, including a 4,000 bed facility at the Excel Centre in London. The site is well known to defense contractors, as it's the venue for the DSEI exhibition. The government announced last week it was pausing the integrated review to focus resources on the COVID-19 fight, without saying when the work would recommence. Wallace answered that question — twice. First he said the review would recommence next year; later he said the correct date was the end of this year, but he was seeking clarity on the exact timing. That decision will be taken by the Cabinet Office who are leading the review. They had previously ordered the review, which was initiated after Prime Minister Boris Johnson won the general election last December, be completed by July. That was a date many analysts and politicians, including the defense committee, thought was risky. “This [the delay] is welcome news. I want a longer period for the integrated review. I want us to examine our place in the world, especially post COVID. It's going to be a different world,” he said. Wallace, an ex-British Army officer, said the number one threat is lack of resilience. "I suspect it will be higher up the agenda as a result of the virus,” he said. The defense secretary said that unlike countries such as France, Britain wasn't bringing forward a number of programs to protect the industrial base. “We are though speaking to industry to ensure their cash flow is continuing. There is a lot of work on the books that we would like to keep going,” he told the committee. One industry executive who asked not to be named said, “cash is not an issue yet, but I'm prepared for that to happen. I'm bracing for extended credit being taken by our customers, but I haven't seen it yet.” The virus has had an impact on a number of major defense programs in the U.K., as people have been ordered to work at home or, if that's not possible, adopt social distancing requirements in the workplace. The impact that might have on defense suppliers ability to meet their contractual obligations, and subsequently their financial viability and and that of the supply chain, has been recognized by the government . A series of actions relating to paying suppliers has been in place since late March, with MoD procurement authorities advised to support suppliers in a range of ways to maintain cash flow. This includes forward ordering, payment in advance, interim payments and payment on order rather than receipt. The scheme has been well received by industry here. The executive said he applauded the government for its swift action, but acknowledged the challenge remains for protecting employment and cash flow. The executive did say though that more clarity was needed from the government over the availability of initiatives like the Corona Business Interruption Loan scheme for defense exporters. Wallace named BAE's F-35 and nuclear submarine activities as programs where the balance between COVID restrictions to keep workers safe and keeping production and cash flow moving were vital. “It's really important that we continue some work that's absolutely key. We also need to help these firms to get through the process, because cash flow is really important to their survival,” said Wallace. But it's not easy keeping your distance from colleagues if you are trying to build something like a nuclear submarine. As such, Wallace said submarine building activities in the U.K. had some of the highest absentee rates in the sector. BAE employs around 9,000 people at its nuclear submarine yard at Barrow in northwest England where it is building Astute-class attack submarines and working on the Dreadnought class of Trident nuclear missile boats. About 4,000 of the staff are working from home with over 1,100 employees now working on site – up from 800-900 last week. A BAE spokesperson said the employees were supporting critical work at the yard. Last week the company reported that HMS Audacious, its latest attack submarine to be built for the Royal Navy, had left the yard and was heading to the submarine base on the Clyde in Scotland. https://www.defensenews.com/global/europe/2020/04/23/uk-defense-plans-could-take-major-hit-from-coronavirus-fallout/

Valerie Insinna A report by a government watchdog that slammed the Air Force's major command-and-control program did not include key classified information and was outdated by the time it was released last week, the service's top general said Wednesday. On Friday, the Government Accountability Office delivered a scathing report on the Air Force's Advanced Battle Management System, which seeks to overhaul the U.S. military's command-and-control infrastructure so that any platform will instantly and seamlessly be able to share data with another weapon system on the battlefield. The problem, according to the GAO, is that the Air Force has not provided enough detail on exactly what technology it needs, how it plans to field it and how much it will cost. But speaking to reporters on Wednesday, Air Force Chief of Staff Gen. Dave Goldfein said the agency did not have access to key information that may have fleshed out the service's plans. “There is a bit of latency to the reporting,” Goldfein said. “Two things I would offer is that they were not able to get to our December ABMS demo. So they didn't actually ... see in real time what we were connecting.” The other problem, Goldfein said, is that the organization was not cleared to receive information about the classified portions of the program. “That makes it challenging because if the technology you're moving forward, if a lot of it is in the classified realm — if a lot of it, quite frankly, was in the space realm — and the GAO doesn't have access or clearance to be able to look at it, then the report is going to be on a very small portion of what the Advanced Battle Management System really is,” he said. In an email to Defense News, GAO director Marie Mak disputed Goldfein's characterization of the report, saying that the organization has a full understanding of past and present ABMS efforts, including the December exercise and numerous classified discussions. “Those discussions did not change our finding that the Air Force still does not have an overall plan for ABMS, a point which they openly acknowledged and in fact concurred with our recommendations,” she said. “The Air Force still needs to develop an overall plan, to include preliminary costs and schedule. Without some type of overall plan in place, it will be difficult for the Air Force to prioritize this program among the acquisition efforts within the Air Force.” When Goldfein became the Air Force's chief of staff in 2016, he made connecting the joint force one of his major priorities. Since then, the service has canceled efforts to replace legacy aircraft that play a role in battlefield management, such as a recapitalization of the E-8C Joint Surveillance Target Attack Radar System aircraft. Instead, it has put its financial resources toward ABMS, which it envisions as a family of systems that will be more survivable than a direct replacement for JSTARS aircraft or other assets. The service tapped Preston Dunlap to manage the ABMS effort in 2019. It then conducted its first set of technology demonstrations in December, where it tested 28 different technologies, with 26 of them proving to be successful. However, some lawmakers have remained skeptical about the Air Force's approach and lack of transparency. In March, Republican Sen. David Perdue called for the Air Force to deliver an analysis of alternatives and capability development document — two pieces of documentation typical to defense acquisition programs. “The development of ABMS is encouraging, but we need to make sure Congress has proper oversight throughout the process,” said Perdue, whose home state of Georgia is the location of Robins Air Force Base, where ABMS is slated to be based. Goldfein did not directly address one of the GAO's major complaints: that the program is at greater risk for schedule delays and cost growth because it does not have a firm business case that spells out capability requirements and cost. But he acknowledged that the Air Force has to do more to share information with Congress and the GAO in a timely matter. However, the pace of the ABMS program may also require lawmakers and the GAO to put in more time to keep updated on the effort's progress, he said. “The GAO has got to keep up ... and we've got to help,” Goldfein said. “This is not a poke or criticism. We've got to help them. We've got to help Congress. We've got to help think tanks. We've got to help others realize that we are moving out and we are developing capability faster than we've ever developed capability before. We're connecting things faster than we've ever connected them before.” “Every four months we are connecting new capabilities that have never been connected. That's a hard one to deliver a report on, but I'm eager to sit down with the GAO and get them up to speed.” Updated on 4/23/19 at 11:45 a.m. with comment from the GAO. https://www.c4isrnet.com/battlefield-tech/c2-comms/2020/04/23/top-air-force-general-blasts-critical-advanced-battle-management-system-report/

By: Joe Gould WASHINGTON — The U.S. Army is girding for modernization program delays and a rise in acquisition costs as the coronavirus pandemic ripples across its installations and through its network of suppliers. Army leaders told reporters Thursday they are confident the service can juggle schedules to make up for any emerging delays and would ask Congress to help address future cost growth. While some larger prime contractors have adapted quickly, officials said, they warned that lower-tier companies with less slack in their workforces remain vulnerable. The Army's Integrated Air and Missile Defense Battle Command System had several major tests and evaluations scheduled, including a long-awaited limited-user test, or LUT. However, Army Futures Command chief Gen. Mike Murray said in a call with reporters that the testing schedule “will slide a little bit, but we will be on time” for the program's other milestone decisions. “I am very confident we will get the LUT done this summer or early fall,” he said. The Army is in the third year of an ambitious modernization overhaul, which depends in part on “soldier touchpoints,” or user evaluations of new equipment. The modernization efforts are now in question as commanders apply physical distancing measures to protect their soldiers. For example, a touchpoint at Fort Riley, Kansas, for a future replacement of the RQ-7 Shadow unmanned aircraft system is going ahead, but the commander at Fort Campbell, Kentucky, decided to postpone one there. Whether wider program delays are coming, “we're still watching very closely, and what I am very much focused on is there may be some slips in key decisions and soldier touchpoints,” Murray said. “The current estimate is we will deliver that [UAS] capability to our soldiers by the time we said we would.” The Army will also push a critical touchpoint for the Integrated Visual Augmentation System from the summer to the fall after Microsoft — a subcontractor for the prime — temporarily closed. The device is a set of goggles meant to provide soldiers next-level night and thermal vision as well as enhance navigation and targeting. “Not only for that program but for all our programs, input from the soldiers that were actually asked to use this equipment has been critical,” Murray said. “That has been impacted.” The comments came as the Pentagon expects a broader three-month delay for major acquisition programs and speeds progress payments to primes that should trickle to small businesses. Army acquisitions officials have worked to help get second- and third-tier suppliers access to small business loans as well as facilitate cash flow to them. “The supply chain does have some challenges, and that's probably where the vast majority of any slips would occur that are tied to individual companies,” said Bruce Jette, the Army's acquisition chief. “These companies are small, and if one person gets COVID in the company, the next thing you know you've lost 14 days with the company because everybody that didn't get it is in quarantine.” BAE Systems coordinated a temporary closure with the Army and plans to scrap a planned summer break to make up the time. Boeing's closure in Philadelphia also came and went. “It's like that down [the] chain for the primes: They tend to be coming back online,” Jette said. “The ones where we end up with two or three weeks are the ones where we've got small individual companies of maybe 20 to 30 people who were suppliers of cables, or connectors and things like that. “There's something there that tends to have a bigger impact or take a little bit longer time. And with them, we try to execute those portions of the program which aren't dependent upon those components, and then we'll come back and clean up the battlespace.” Some big agenda items for the Army don't appear to have been knocked off balance. For example, the Army is still planning on another flight test of Lockheed Martin's Precision Strike Munition, or PrSM, by April 30, which will deliver a new long-range precision fires capability to the battlefield. The capability is the Army's No. 1 modernization priority. “I'm confident enough that we're going to do the next test flight [of] PrSM that I scheduled a military aircraft to go out and see it, so I'm very confident,” Murray said. The Army's latest “night court” review — used to divest the service of unneeded programs — proceeded virtually, as much of the Pentagon shifted to remote work. As part of the review, Army leaders recently received the final brief concerning equipment. “A lot of the recommendations are pretty much close to being finalized,” Murray said. https://www.defensenews.com/land/2020/04/23/us-army-confident-any-tech-schedule-slips-are-recoverable/

Au-delà du plan sanitaire, la crise du Coronavirus impacte l'ensemble des projets des Etats et vient questionner l'Europe. L'Europe questionnée. Le Sénat, à travers la commission des affaires étrangères et de la défense et des sénateurs Hélène Conway-Mouret et Ronan Le Gleut, a présenté les impacts de la crise du coronavirus sur l'Europe, sous l'angle de la défense et de la sécurité. Et le constat semble sans appel : la coopération entre les Etats européens doit être renforcée. « Le bilan de la coopération européenne est pour le moment nuancé : des coopérations bilatérales ont permis des transferts de patients du Grand Est vers des pays frontaliers [...] mais le Conseil européen du 26 mats a donné le spectacle d'Etats membres divisés, incapables de répondre rapidement à l'urgence de la situation », rapporte les deux sénateurs, en rappelant par ailleurs que des mécanismes existants permettraient une coopération accrue, à l'instar de l'article 222 du TFUE qui met en avant le principe de solidarité. Surveiller le contexte international. Cette nécessité de coopération est à analyser à la lumière du contexte international précédent la crise et renforcé par l'événement sanitaire qui touche actuellement le monde. « La crise risque en effet d'accentuer les évolutions stratégiques en cours : l'effritement de l'Europe, le désengagement américain et l'affirmation de puissance de certains Etats qui ne manqueront pas de s'emparer de la faiblesse de l'Europe pour faire avancer leurs propres intérêts », expliquent les deux sénateurs. En effet, on ne manquera pas de noter que si la crise touche violemment la grande majorité des Etats du monde, certains restent épargner, à l'instar de la Corée du Nord qui profite de l'occasion pour démontrer ses capacités militaires et mener des essais de missiles. De même, certains Etats profitent de l'absentéisme de réponse européenne pour nouer des liens précieux avec des pays du vieux continent en leur apportant une aide cruciale face à la crise. « Plusieurs acteurs et observateurs estiment aujourd'hui que la Chine et la Russie utilisent la crise sanitaire pour faire avancer leurs intérêts et renforcer leur influence. [...] Le déploiement de militaires russes en Italie, dans les zones les plus touchées par l'épidémie (Bergame) suscite des interrogations », rapportent les deux sénateurs. Rester présent en OPEX. Une autre préoccupation liée à la crise sanitaire actuelle réside dans la gestion des opérations extérieures. Une préoccupation qui touche d'autant plus la France, qui est aux premières loges au niveau européen. L'Europe « ne doit pas se détourner du reste du monde car la pandémie, si elle mobilise les esprits, ne fait pas disparaître les autres crises, et risque même de les aggraver », soulignent les auteurs. Une attention particulière doit être donnée à l'Afrique, qui souffre déjà d'importants déséquilibres économiques et d'inégalités sociales majeures, souvent à la racine des conflits qui sévissent actuellement sur le continent. Or cette situation pourrait se trouver largement accentuée par la crise du coronavirus, touchant massivement les économies des pays à travers le monde. Une accentuation des problèmes économiques et sociaux en Afrique pourrait aboutir à des désaccords internes pouvant mener à des affrontements. Retour à la case départ ? https://air-cosmos.com/article/limpact-du-coronavirus-pour-leurope-22957

By: Tom Kington ROME — Italy shipbuilder Fincantieri has reopened its facilities after more than a month of closure due to coronavirus. The state controlled firm shut down on March 16 after talks with unions as the virus swept through Italy — the first Western country to be hit hard. Since then, Italy's death toll has been overtaken by the U.S., but remains the most exposed country in Europe, with more than 25,000 deaths and 187,000 total infections. As the contagion rate slows however, the government is targeting May 4 as the date to relax rigid lockdown rules for the public. Fincantieri was given the go ahead to restart production on Monday — at a reduced pace. At the firm's Riva Trigoso yard in the Liguria region, where 1,800 were employed before lockdown building Italy's final FREMM frigate and PPA vessels for the Italian navy, just 350 will initially return to work, a spokesman said. Of that number, 150 will be Fincantieri staff, while the remainder are maintenance, cleaning and security contractors. A similar policy is being followed at Fincantieri's Muggiano yard, also in Liguria, where 2,600 are normally employed, and where just 200 staff and 200 contractors have returned to continue work for Italy on a logistics vessel, the Vulcano and a new LHD, the Trieste; as well as a corvette for Qatar. “We hope to be back to full personnel numbers by the end of May or the start of June,” said the spokesman. In the meantime, safety precautions will be taken, including staggered entrances to the yards for staff, obligatory masks and gloves at work, temperature checks at entrances to spot fever sufferers and in-house medical staff. Each staff member will be given a packet of 20 masks per week so they can change them multiple times during each day. “We are planning buses to get staff to work so they don't have to use public transport,” said the spokesman. Similar measures will be taken at Fincantieri's other yards in Italy, which build cruise ships. During the shutdown, the firm's 8,900 staff were kept at home through use of vacation time, furloughs and home working. By contrast, Italian state defense group Leonardo did not close during the lockdown, although many staff worked from home when possible. A deal was struck with unions to introduce social distancing and cleaning at facilities in Italy, and no staff were furloughed, a spokeswoman said. Separately, the Italian government has reconfirmed Leonardo CEO Alessandro Profumo in his role after his mandate ended. The government did however appoint a new chairman, Luciano Carta, who moves from his post as director of Italy's foreign intelligence service. He replaces Gianni De Gennaro, who was head of the government department overseeing Italy's foreign and domestic intelligence services between he joined Leonardo in 2013. https://www.defensenews.com/coronavirus/2020/04/22/fincantieri-reopens-shipyards-in-italy