21 décembre 2020 | International, Aérospatial, Naval, Terrestre, C4ISR, Sécurité

Contract Awards by US Department of Defense - December 18, 2020

ARMY

General Dynamics Land Systems Inc., Sterling Heights, Michigan, was awarded a $4,620,000,000 fixed-price-incentive contract to produce Abrams M1A2 SEPv3 tanks. Bids were solicited via the internet with one received. Work locations and funding will be determined with each order, with an estimated completion date of June 17, 2028. The U.S. Army Contracting Command, Detroit Arsenal, Michigan, is the contracting activity (W56HZV-21-D-0001).

STS International Inc., Berkeley Springs, West Virginia, was awarded a $49,500,000 firm-fixed-price contract for combat field service equipment team services. Bids were solicited via the internet with four received. Work locations and funding will be determined with each order, with an estimated completion date of Dec. 17, 2025. The U.S. Army Contracting Command, Aberdeen Proving Ground, Maryland, is the contracting activity (W911QY-21-D-0001).

Canadian Commercial Corp., Ottawa, Ontario, was awarded a $30,000,000 firm-fixed-price contract for the removal of existing excitation equipment and replacement of solid-state excitation equipment/systems. Bids were solicited via the internet with seven received. Work locations and funding will be determined with each order, with an estimated completion date of Dec. 17, 2030. The U.S. Army Corps of Engineers, Nashville, Tennessee, is the contracting activity (W912P5-21-D-0002).

NAVY

Koa Lani JV LLC,* Orlando, Florida, is awarded an $854,000,000 indefinite-delivery/indefinite-quantity contract with firm-fixed price, cost-plus incentive fee and cost-reimbursement contract line items for range operations support and base operations support services. This contract includes a 60-month base period with one 60-month option period. Work will be performed at the Pacific Missile Range Facility, Island of Kauai, Hawaii. Work is expected to be completed by December 2025; if the option is exercised, work will be completed by December 2030. Subject to the availability of funds, fiscal 2021 operation and maintenance funds (Navy) in the amount of $20,000,000 will be obligated at the time of award to fund the contract's minimum amount and funds will not expire at the end of the current fiscal year. The requirement was posted to the Federal Business Opportunities website and the Navy Electronic Commerce Online website as a 100% 8(a) set-aside requirement, with three offers received. The Naval Supply Systems Command, Fleet Logistics Center, Pearl Harbor, Hawaii, is the contracting activity (N00604-21-D-4000).

L3 Technologies Inc., Salt Lake City, Utah, is awarded a $495,530,542 cost-plus-incentive-fee contract. This contract provides for the production and delivery of 10 pod simulators, eight operational prototype pods, four jettison mass model pods, two captive mass models, two mission system prototypes and two technique development systems in support of engineering and manufacturing development for the Next Generation Jammer Low Band program. Work will be performed in Salt Lake City, Utah (66%); Boulder, Colorado (10%); Carlsbad, California (9%); Stuart, Florida (7%); Indianapolis, Indiana (4%); St. George, Utah (2%); and Guthrie, Oklahoma (2%), and is expected to be completed in September 2025. Fiscal 2020 research, development, test and evaluation (Navy) funds in the amount of $20,377,862 will be obligated at time of award, all of which will expire at the end of the current fiscal year. This contract was competitively procured via an electronic request for proposal; two offers were received. The Naval Air Systems Command, Patuxent River, Maryland, is the contracting activity (N00019-21-C-0021).

Raytheon Missile Systems, Tucson, Arizona, is awarded a $145,101,510 modification (P00003) to previously issued fixed-price-incentive-firm-target, firm-fixed-price contract N00019-20-C-0030. This modification exercises an option for the production and delivery of 90 full rate production Lot 17 Block V Tactical Tomahawk (TACTOM) All Up Round (AUR) Vertical Launch System missiles, including related hardware and services for the Navy. Additionally, this modification procures TACTOM AUR recertification AGR-4 spares. Work will be performed in Tucson, Arizona (40.6%); Walled Lake, Michigan (11.4%); Gainesville, Virginia (9.7%); El Segundo, California (5.1%); Clearwater, Florida (3.3%); Glenrothes, Scotland (3.1%); Spanish Fork, Utah (3%); Middletown, Connecticut (2.7%); Berryville, Arkansas (2.5%); Midland, Ontario, Canada (2.4%); Ontario, California (2%); Camden, Arkansas (1.8%); Vergennes, Vermont (1.7%); Anniston, Alabama (1.2%); and various locations within the continental U.S. (9.5%), and is expected to be completed in December 2023. Fiscal 2021 weapons procurement (Navy) funds in the amount of $140,686,082; and fiscal 2020 weapons procurement (Navy) funds in the amount of $4,415,428 will be obligated at time of award, none of which will expire at the end of the current fiscal year. The Naval Air Systems Command, Patuxent River, Maryland, is the contracting activity.

Progeny Systems Corp.,* Manassas, Virginia, is awarded a $41,716,025 fixed-price-incentive (firm target), cost-plus-fixed-fee and cost only modification to previously awarded contract N00024-18-C-6410 to exercise options for the production of MK54 MOD 1 lightweight torpedo kits, associated production support material, spares and engineering and hardware support services. This modification is in support of the MK54 MOD 1 Lightweight and MK48 Heavyweight torpedo programs. This contract combines purchases for the Navy (99%); and the governments of Australia, Canada, Taiwan, United Kingdom, Netherlands, Denmark and Belgium (1% combined), under the Foreign Military Sales (FMS) program. Work will be performed in Charleroi, Pennsylvania (70%); Salt Lake City, Utah (26%); and Manassas, Virginia (4%), and is expected to be completed by December 2023. Fiscal 2021 weapons procurement (Navy) funds in the amount of $41,210,110 (99%); and FMS funds in the amount of $505,915 (1%) 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.

CFM International Inc., West Chester, Ohio, is awarded a $28,529,246 modification (P00006) to previously awarded firm-fixed-price contract N00019-18-C-1071. This modification adds scope to procure two P-8A Poseidon CFM56-7B27AE engines for the governments of Australia and New Zealand. Work will be performed in Villaroche, France (53%); Durham, North Carolina (43%); Singapore (3%); and Bromont, Canada (1%), and is expected to be completed in November 2021. Foreign Military Sales funds in the amount of $14,264,623; and foreign cooperative project funds in the amount of $14,264,623 will be obligated at time of award, none of which will expire at the end of the current fiscal year. The Naval Air Systems Command, Patuxent River, Maryland, is the contracting activity.

General Dynamics Bath Iron Works, Bath, Maine, is awarded a $23,852,562 cost-plus-award-fee and cost modification to previously awarded contract N00024-19-C-2322 to exercise options for the accomplishment of planning yard efforts such as engineering, technical, planning, ship configuration, data and logistics efforts for DDG-1000 class destroyers post-delivery and in-service life-cycle support. Work will be performed in Bath, Maine (95%); and San Diego, California (5%), and is expected to be completed by December 2021. Fiscal 2021 shipbuilding and conversion (Navy) $1,659,554 funding will be obligated at the 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 (N00024-19-C-2322).

Northrop Grumman Systems Corp., San Diego, California, is awarded a $22,320,161 modification (P00006) to previously awarded cost-plus-fixed-fee contract N00019-20-C-0025. This modification exercises options to procure software and engineering sustainment services, software support, logistics, cyber security and program related engineering in support of MQ-8 Fire Scout unmanned air systems. Work will be performed in San Diego, California, and is expected to be completed in December 2021. Fiscal 2021 aircraft procurement (Navy) funds in the amount of $5,452,295; fiscal 2021 operation and maintenance (Navy) in the amount of $3,982,259; and fiscal 2021 research, development, test and evaluation (Navy) funds in the amount of $139,877 will be obligated at time of award, of which $3,982,259 will expire at the end of the current fiscal year. The Naval Air Systems Command, Patuxent River, Maryland, is the contracting activity.

BAE Systems Platforms & Services, Minneapolis, Minnesota, is awarded an $18,000,057 fixed-price contract action for Virginia class submarine propulsors. The services under this contract include the engineering and support for the construction of fixed assemblies for the Virginia class propulsor. This contract includes options which, if exercised, would bring the cumulative value of this contract to $98,152,185. Work will be performed in Louisville, Kentucky (90%); and Minneapolis, Minnesota (10%), and is expected to be completed by February 2027. Fiscal 2020 shipbuilding and conversion (Navy) $18,000,057 funding will be obligated at time of award and will not expire at the end of the fiscal year. This contract was not competitively procured in accordance with 10 U.S. Code 2304(c)(1) (only one responsible source and no other supplies or services will satisfy agency requirements). The Naval Sea Systems Command, Washington, D.C., is the contracting activity (N00024-21-C-4106).

Daniels & Daniels Construction Co., Inc., Goldsboro, North Carolina, is awarded a $13,437,820 firm-fixed-price contract for the construction of the Marine Raider Regiment Headquarters, Marine Corps Base, Camp Lejeune, North Carolina. The work to be performed constructs a headquarters facilities and includes miscellaneous supporting structures, utilities, parking, roadways, sidewalks, running trails and site work. The structures will be single-story steel frame buildings with brick veneer over metal studs, standing seam metal roofs, metal soffits and translucent wall panels. Work will be performed at Marine Corps Base, Camp Lejeune, North Carolina, and is expected to be completed by December 2022. Fiscal 2020 military construction (Navy) contract funds in the amount of $13,437,820 are obligated on this award and will not expire at the end of the current fiscal year. This contract was competitively procured via the beta.SAM.gov website with five proposals received. The Naval Facilities Engineering Systems Command, Mid-Atlantic, Norfolk, Virginia, is the contracting activity (N40085-19-R-9148).

DRS Systems Inc., Melbourne, Florida, is awarded a $10,121,768 firm-fixed-price, cost-plus-fixed-fee, cost reimbursable delivery order (N00019-21-F-0238) against previously issued basic ordering agreement N00019-19-G-0030. This order provides non-recurring engineering for the design, development and integration of the AN/AAQ-45 Distributed Aperture Infrared Countermeasure system, including associated weapons replaceable assemblies in support of the HH-60W aircraft for the Air Force. Work will be performed in Dallas, Texas (80%); San Diego, California (11%); Fort Walton Beach, Florida (8%); and Melbourne, Florida (1%), and is expected to be completed in January 2023. Fiscal 2020 research, development, test and evaluation (Air Force) funds in the amount of $10,121,768 will be obligated at time of award, all of which will expire at the end of the current fiscal year. The Naval Air Systems Command, Patuxent River, Maryland, is the contracting activity.

The Lockheed Martin Corp., Rotary and Mission Systems, Mitchel Field, New York, is awarded a $9,273,205 cost-plus-incentive fee and cost-plus-fixed-fee contract modification (P00012) to previously awarded and announced contract N00030-20-C-0045 for the U.S. and United Kingdom (U.K.) to provide strategic weapon system Trident fleet support, Trident II SSP Shipboard Integration (SSI) Increment 8, SSI Increment 16, Columbia class and U.K. Dreadnought class navigation subsystem development efforts. Work will be performed in Mitchel Field, New York (47%); Huntington Beach, California (36%); Clearwater, Florida (9%); Cambridge, Massachusetts (6%); and Hingham, Massachusetts (2%), with an expected completion date of Nov. 30, 2023. Fiscal 2021 other procurement Navy funds in the amount of $9,273,205 will be obligated. No funds will expire at the end of the current fiscal year. This contract was a sole-source acquisition in accordance with 10 U.S. Code 2304(c)(1) and (4). The Strategic Systems Programs, Washington, D.C., is the contracting activity.

Raytheon Co., McKinney, Texas, is awarded an $8,400,868 firm-fixed-price order (N68335-21-F-0102) against previously issued basic ordering agreement N68335-20-G-1043. This order provides non-recurring engineering for the Multi-Spectral Targeting System (MTS) software deficiency corrections, design and integration of four turret unit sensors and two electronics unit circuit card assemblies to address system obsolescence and provide a standard definition compatible system to multiple systems on various aircraft that utilize the MTS for the governments of India and Australia. Work will be performed in McKinney, Texas (85%); Patuxent River, Maryland (10%); and Owego, New York (5%), and is expected to be completed in September 2022. Foreign cooperative project funds in the amount of $6,853,795; and Foreign Military Sales funds in the amount of $1,547,073 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, Lakehurst, New Jersey, is the contracting activity.

Edison Chouest Offshore, Cut Off, Louisiana, is awarded a $7,740,555 modification (P00021) to previously awarded firm-fixed-price contract N32205-17-C-3513 to exercise a third 12-month option with reimbursable elements for one maritime support vessel MV Carolyn Chouest. This vessel will be utilized to launch, recover, refuel and resupply of various size crafts in the U.S. Indo-Pacific Command's (USINDOPACOM) area of responsibility (AOR). This contract includes a 12-month base period, three 12-month option periods and one 11-month option period. Work will be performed in the USINDOPACOM AOR, and is expected to be completed, if all options are exercised by Nov. 21, 2022. The option will be funded by fiscal 2021 (Navy) working capital funds in the amount of $6,001,581 that will expire at the end of the fiscal year; and fiscal 2022 (Navy) working capital funds in the amount of $1,738,974 that will expire at the end of fiscal 2022. The Military Sealift Command, Norfolk, Virginia, is the contracting activity.

AIR FORCE

The Boeing Co., Oklahoma City, Oklahoma, has been awarded a $400,000,000 modification (P00014) to contract FA8107-19-D-0001 for B-1 and B-52 bomber engineering services. This modification is for recurring and non-recurring engineering services to B-1 and B-52 aircraft. Work will be performed at Tinker Air Force Base, Oklahoma; Edwards AFB, California; Barksdale AFB, Louisiana; and Oklahoma City, Oklahoma, and is expected to be completed Dec. 31, 2022. The total cumulative value of the contract is $1,200,000,000. Fiscal 2021 operation and maintenance funds in the amount of $33,903,201 are being obligated at the time of award. The Air Force Life Cycle Management, Tinker Air Force Base, Oklahoma, is the contracting activity (FA8107-19-D-0001).

Kegman Inc., Melbourne, Florida, has been awarded a $98,700,000 firm-fixed-price, indefinite-delivery/indefinite-quantity contract with cost-reimbursable line items for travel and material purchases as needed and approved by the government. This contract provides non-personal advisory and assistance services in support of the Air Force Technical Applications Center's (AFTAC) mission that will include, but not be limited, to technical, programmatic, acquisition, expert panel, analyses, engineering, logistical and consultation support on a task order basis. Work will be performed on Patrick Space Force Base, Florida, and is expected to be completed Dec. 31, 2025. This award is the result of a competitive acquisition and one offer was received. Subject to the availability of funding, fiscal 2021 operation and maintenance funds in the amount of $2,267,485; fiscal 2021 research, development, test and evaluation funds in the amount of $3,194,720; and fiscal 2021 other procurement funds in the amount of $256,955 are being obligated at the time of award. Headquarters Air Combat Command, Acquisition Management and Integration Center, Patrick Space Force Base, Florida, is the contracting activity (FA7022-21-D-0002).

Lockheed Martin Missile and Fire Control, Orlando, Florida, has been awarded a $48,634,855 855 cost-plus-incentive-fee and cost-plus-fixed-fee modification (P00017) to contract FA8682-18-C-0009 for the Joint Air-to-Surface Standoff Missile Group One development. This contract modification provides risk reduction testing, cyber testing and coatings to support the Group One development effort. Work will be performed in Orlando, Florida, and is expected to be completed June 28, 2024. Fiscal 2020 research, development, test and funds in the amount of $5,338,074; and fiscal 2019 other procurement funds in the amount of $3,100,060 are being obligated at the time of award. Total cumulative face value of the contract is $258,029,572. The Air Force Life Cycle Management Center, Eglin Air Force Base, Florida, is the contracting activity.

General Atomics Aeronautical Systems Inc., Poway, California, has been awarded a $36,246,974 modification (P00009) to contract FA8620-20-C-2009 for France contractor logistics support MQ-9 Block Five and Block One aircraft. The contractor will provide an additional period of contractor logistics support for the French Air Force. Work will be performed in Poway, California, and is expected to be completed Dec. 31, 2021. This contract involves 100% Foreign Military Sales (FMS) to France. FMS funds in the amount in the full amount are being obligated at the time of award. The total cumulative face value of the contract is $73,305,690. The Air Force Life Cycle Management Center, Wright-Patterson Air Force Base, Ohio, is the contracting activity (FA8620-20-C-2009).

DynCorp International LLC, Fort Worth, Texas, has been awarded a $14,761,791 firm-fixed-price modification (P000012) to contract FA2860-19-C-0005 for rotary wing maintenance. This contract provides helicopter maintenance of aircraft assigned to the 316th Wing at Joint Base Andrews, Maryland. This modification exercises Option Period Two and is expected to be completed Dec. 31, 2021. Fiscal 2021 operation and maintenance funds in the full amount are being obligated at the time of award. Total cumulative face value of the contract is $75,020,715. The 316th Contracting Squadron, Services Flight, Joint Base Andrews, Maryland, is the contracting activity.

The Raytheon Co., El Segundo, California, has been awarded a $10,873,024 cost-plus-fixed-fee contract for the sustainment of the Enhanced Integrator Sensor Suite (EISS) for the RQ-4 Global Hawk program. This contract provides for contractor logistics support and sustainment of the EISS on the RQ-4 Global Hawk aircraft. Work will be performed in El Segundo, California, and is expected to be completed Dec. 31, 2025. This award is the result of a sole-source acquisition. Fiscal 2021 operation and maintenance funds in the amount of $923,333 are being obligated at the time of award. The Air Force Life Cycle Management Center, Robins Air Force Base, Georgia, is the contracting activity (FA8577-21-C-0002).

DEFENSE LOGISTICS AGENCY

SupplyCore, Inc.,* Rockford, Illinois, has been awarded a maximum $80,000,000 firm-fixed-price, indefinite-delivery/indefinite-quantity contract for facilities maintenance, repair and operations supplies. This was a sole-source acquisition using justification 10 U.S. Code 2304 (c)(1), as stated in Federal Acquisition Regulation 6.302-1. This is a one-year bridge contract with no option periods. Locations of performance are Ohio, Kentucky, Indiana, Nebraska, Illinois, Wisconsin, Iowa, Missouri, Minnesota, Michigan, North Dakota and South Dakota, with a Dec. 18, 2021, ordering period end date. Using customers are Army, Navy, Air Force, Marine Corps, and Coast Guard. Type of appropriation is fiscal 2021 through 2022 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania (SPE8E3-21-D-0004).

FreshPack Produce Inc., Denver, Colorado, has been awarded a maximum $41,500,000 firm-fixed-price with economic-price-adjustment, indefinite-delivery/indefinite-quantity contract for fresh fruits and vegetables. This was a competitive acquisition with one response received. This is a five-year contract with no option periods. Location of performance is Colorado, with a Feb. 28, 2026, ordering period end date. Using customers are Department of Agriculture schools and reservations. Type of appropriation is fiscal 2021 through 2026 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania (SPE300-21-D-S748).

TMG OpCon LLLP, Ellijay, Georgia, has been awarded a maximum $27,000,000 fixed-price with economic-price-adjustment, indefinite-delivery/indefinite-quantity contract for medical equipment and accessories for the Defense Logistics Agency electronic catalog. This was a competitive acquisition with 135 responses received. This is a five-year contract with no option periods. Location of performance is Georgia, with a Dec. 17, 2025, performance completion date. - Using military services are Army, Navy, Air Force and Marine Corps. Type of appropriation is fiscal 2021 through 2026 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania (SPE2DH-21-D-0054).

Crown Clothing Co.,* Vineland, New Jersey, has been awarded a maximum $8,541,763 firm-fixed-price, indefinite-delivery/indefinite-quantity contract for men's coats, belts and keepers. This was a competitive acquisition with four responses received. This is a one-year base contract with four one-year option periods. Location of performance is New Jersey, with a Dec. 17, 2021, ordering period end date. Using military service is Marine Corps. Type of appropriation is fiscal 2021 through 2022 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania (SPE1C1-21-D1432).

*Small business

https://www.defense.gov/Newsroom/Contracts/Contract/Article/2452534/source/GovDelivery/

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    30 juin 2020 | International, Aérospatial

    South Korea to spend $2 billion on aircraft buy

    By: Mike Yeo MELBOURNE, Australia – South Korea is set to acquire more airborne surveillance and intelligence gathering aircraft, as the U.S. ally seeks to bolster its capabilities in both areas. The country's Defense Project Promotion Committee approved last Friday plans to acquire an undisclosed number of airborne early warning and control, or AEW&C aircraft, according to the Defense Acquisition Program Administration or DAPA. The committee also approved plans to acquire more signals intelligence or SIGINT gathering aircraft. Approximately $1.3 billion has been earmarked for the acquisition of the AEW&C aircraft for entry into service by 2027 while a further $725 million has been set aside for the SIGINT platforms, which are expected to enter service in 2026. The announcement did not disclose the platforms being pursued for either program, but South Korea is almost certain to go with additional Boeing 737 AEW&C aircraft. The Republic of Korea Air Force or ROKAF is already operating four such aircraft, acquired from the United States under the Peace Eye program, since 2012. The Peace Eye 737s are derivatives of Boeing's 737 Next Generation airliners fitted with a distinctive dorsal radar housing containing a Northrop Grumman Multi-Role Electronically Scanned Array or MESA radar. The L-band radar is reportedly capable of simultaneous air and sea search, fighter control and area search, simultaneously tracking 180 targets and conducting 24 intercepts. The DAPA announcement said the acquisition of additional AEW&C aircraft will be to further minimize gaps in South Korea's air defence coverage. South Korea has in recent months publicised the intercept of Chinese and Russian military aircraft entering the Korean Air Defense Identification Zone or KADIZ. The new SIGINT aircraft will be used to replace four older platforms based on the Hawker 800 business jets. DAPA says the new aircraft will be equipped with indigenous systems and will serve alongside two Dassault Falcon 2000 SIGINT aircraft delivered to the ROKAF in 2017. The older Hawker 800 platforms were acquired in 1996 under the Paekdu project and were modified by E-Systems Incorporated for its SIGINT role. The aircraft were delivered in the early 2000s along with four other Hawker 800XPs modified for imagery reconnaissance with synthetic aperture radars and moving target indicators. https://www.defensenews.com/global/asia-pacific/2020/06/29/south-korea-to-spend-2-billion-on-aircraft-buy/

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  • How COVID-19 Could Change The A&D Supply Chain

    16 mars 2020 | International, Aérospatial, Naval, Terrestre, C4ISR, Sécurité

    How COVID-19 Could Change The A&D Supply Chain

    Michael Bruno The COVID-19 outbreak is the biggest punch to the gut commercial aviation has taken since the Sept. 11, 2001, terrorist attacks. And coming on the heels of the Boeing 737 MAX crisis, Airbus and Boeing widebody production rate cuts, U.S. trade wars and the flight-shaming movement in Europe, the coronavirus emergency is challenging the aerospace manufacturing sector and its global supply chain. Is the historic upcycle of commercial aircraft orders over? Will orders be canceled and deferred? Will business aviation go out of favor? Only time will tell, but it has been interesting to hear what aerospace and defense (A&D) executives are worrying about. First, lost revenue from disrupted operations in China is not among their worries. Practically no one in A&D manufacturing has revised their 2020 financial forecasts—provided in January or February—because of COVID-19 alone. “To date, we have no reported cases of our employees having contracted the virus, and the direct impact to our trading activities has been minimal,” Senior Plc CEO David Squires said March 2. Likewise, GE CEO Larry Culp did not change the company's financial outlook because COVID-19 was already cited in a forecast given last month. “In our view, in all likelihood it is going to be temporary, but it doesn't mean it is going to disappear tomorrow,” Culp said at a March 4 shareholder briefing. To be sure, some OEMs and suppliers with Chinese operations had to shut down in recent weeks due to COVID-19. But those factories are back up, and the impact to revenue was limited. For instance, only 20 of Triumph Group's roughly 5,000 active suppliers are located in China or South Korea. All 20 remain operational, and no supply chain interruptions have occurred. On the supply side, the glancing blow could have a lot to do with the fact that not much in Western aerospace is sourced in China. According to U.S. Commerce Department data, the U.S. imports just $1.1 billion annually in aircraft, spacecraft and related parts. What is more, that figure has been dropping since 2016—before the U.S.-China trade war—and was expected to fall off a cliff for 2019 and 2020 regardless of the “Phase One” trade deal truce. China always was a twofold market for U.S. aerospace: Sell parts and services to existing Western-supplied fleets there, and partner for local production of nonproprietary parts and systems for emerging Chinese fleets. But China is ramping up efforts to get its own fleet into operation and is pairing with Russian suppliers more often. Any growth in overall aerospace trade likely would have to come from a jump in Chinese orders of Airbus or Boeing airliners, which was not widely expected in the wake of the Jan. 16 trade truce and is not anticipated now after the recent plummet in Chinese air traffic. Although collapsing demand worldwide for air travel could have a devastating effect on A&D manufacturing and supply, executives do not consider it likely. COVID-19 quickly turned into a short, sharp shock to the system, but industry leaders see the same underlying macro conditions driving long-term growth. Chief among them: expanding middle classes worldwide that spend more discretionary funds traveling by air for leisure. During the 2020 Aviation Summit in Washington, new Collins Aerospace President Stephen Timm was asked if the airliner-customer landscape could look a lot different in coming years due to the scare. “Frankly, we're going to see differences,” Timm said. “This will be a blip—a serious blip that we have to deal with today—but compared with the macro aerospace industry, we're in a really good place.” Where do industry insiders see change coming to the supply chain? For one thing, COVID-19 could help deepen resistance to business travel, said some attending Aviation Week's Annual Aerospace Raw Materials and Manufacturers Supply Chain Conference on March 9-12. That would exacerbate the ongoing drop in demand for widebodies. Still, the biggest change could come in accelerating a budding shift in A&D supply from globalization to regionalization. Executives and consultants at both the Wharton Aerospace Conference on Feb. 29 and Aviation Week's supply chain event discussed how COVID-19 cements a belief that just-in-time global supply chains are too risky and not worth the lower cost anymore. Instead, they look to capitalize on aerospace manufacturing hubs in Asia, Europe-North Africa and North America to supply themselves. The trend could start with aerostructures for future single-aisle airliners, especially as composite materials are increasingly incorporated. “From a colocation strategy,” says one supplier executive, “you will see it in the next-gen airplanes.” https://aviationweek.com/aerospace/manufacturing-supply-chain/how-covid-19-could-change-ad-supply-chain

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