Government watchdog finds more problems with F-35’s spare parts pipeline

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  16 octobre 2024 | International, Terrestre

  RTX to pay $950 million to resolve US defense fraud, Qatar bribery charges

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  28 août 2018 | International, Aérospatial, Naval, Terrestre, C4ISR

  Head of Saudi Arabia’s defense industry umbrella org talks Vision 2030

  By: Jill Aitoro LONDON — In spring 2016, Crown Prince of Saudi Arabia Mohammed bin Salman unveiled a plan to reduce the country's dependence on oil and to diversify the economy. The goal of Saudi Vision 2030, as that plan is known, is to make Saudi Arabia “the heart of the Arab and Islamic worlds, the investment powerhouse, and the hub connecting three continents.” Among the sectors central to that vision is military. Taking cues from other countries in the region, Saudi Arabia stood up a single umbrella organization to lead its efforts in defense development and expertise: the Saudi Arabian Military Industries. Defense News spoke to CEO Andreas Schwer in an exclusive interview about the goals of SAMI, and what it could mean for global defense partnership and cooperation. You lead the Saudi Arabian Military Industries. I would love for you to talk a bit about how SAMI, as it's known, was stood up and the goals of that organization. When the Vision 2030 program was established and defined by his royal highness, it became apparent right from the beginning that the defense industry would play a major role to achieve these global targets. So the defense industry, set up, is one of the major tasks of the Vision 2030 program. They established a team to define how this kind of defense industry should be set up. They were looking to comparable countries who are undergoing this kind of process — countries like Turkey, South Korea, South Africa or some Western countries. They have tried to learn the lessons out of that process. It was obvious that there are two choices: either to go for a [new company], or to use existing assets and to build up on those assets. They decided to go [new] in order to enhance the opportunity to implement best Western practices from the beginning. That was the key decision to go ahead, and they decided to build a nucleus which is covering any kind of [military] activities, starting from space, ground or naval activities under one big umbrella company to set up a kind of sustainable business instead of having different companies of smaller size. Are they operating relatively independently, or is it really one management structure? SAMI itself is acting as a kind of active holding company. We will operate through four business divisions. Each of the business divisions will be composed of a set of business units. A business unit is a joint venture with a foreign partner, but it would also integrate the existing assets in the kingdom into this umbrella environment; assets which are already joint ventures today but also nationally owned assets, which will be allocated to the various business divisions. I know you have an extensive career with defense companies. You were with Rheinmetall, and you spent time at Airbus. What interested you about this opportunity? It's quite unique overall in the world that to set up a new company which covers, again, all the product portfolio you can imagine. Space, aviation, land systems, hydraulic simulation, ammunition, shipbuilding, everything. I don't think there's any job in the world which offers you this kind of broad portfolio of activities. So it's unique. It's a once-in-a-lifetime chance. And the second argument is it's fantastic to set up a company. You can apply all your ideas, all the activity to form and shape something which otherwise you will never be able to do, versus ending up in an organization where almost all elements are predefined and it's hard to implement any kind of significant change. You have said that the goal for SAMI is to become one of the largest 25 defense companies in the world by 2030. How do you intend to make that happen? Saudi Arabia has the third-biggest defense budget in the world. It's around $70 billion throughout the year. On top of that, we have to look to all the budgets for the other customers on the domestic scene. It's the National Guard, the Royal Guard, Ministry of Interior, homeland security. There are lots of national customers [for] security-related equipment. Most of that will end up at SAMI's desk. So just by the volume and the size of the procurement, it's achievable, [also with] export potential of 30 percent. With that, you can easily achieve the target to become among the top 25 companies in the world. The Pentagon started working with Saudi Arabia on some very sizable foreign military sales from the United States, with the Trump administration very vocal about supporting that. How does that fit into the picture? There are lots of partnership opportunities. Those [foreign military sales] will be subject to our new scenario. We will apply for each and any of those contracts with the 50 percent localization rule, to be in line with Vision 2030. And whether it's a foreign military sale or whether it's a direct commercial sale, those sorts of buys will offer in all the local industries great opportunities for growth. So it's a good opportunity? You would say it's a positive? It's possible. But we have to make the target. We have to grow the local content from the 2 percent to more than 50 percent of the total span, new procurement, and [maintenance, repair and overhaul]. That's the target: 50 percent localization. That brings up an interesting point. Saudi Arabia has long voiced, like many countries in the Middle East, a desire for more indigenous capabilities. You mentioned the 50 percent localization in terms of contract opportunities, but how else can SAMI promote those aspirations? In the past, we've had the classic vendor-buyer relationship. Saudi Arabia was the classic buyer with very, very little local content. There were offset obligations, but most of the times they were never being fulfilled for different reasons. In the new scheme, we change from this kind of supplier-vendor relationship to a partnership model, a partnership model to the extent that we expect the foreign partner — under the terms of their exclusivity access to Saudi Arabia — to bring all their technologies, all the skills and knowledge into the kingdom. That typically is established through a joint venture so we can build up local competence not only by getting licenses for production, but in the engineering and R&D field to be able to develop the next generation of weapons systems, within the joint venture, within the kingdom. And you established a joint venture with Boeing. Can use that as an example? Saudi Arabia has a very long-lasting, strategic relationship with Boeing. It started many years ago, and we already have an established joint venture in the kingdom, where we conduct substantial aircraft MRO activities. Our future collaboration is obviously centered around this activity and will be expanded along the portfolio of Boeing products. Boeing is a showcase. Boeing is one of our most important partners. What does Saudi Arabia bring to the table both in terms of location, and technological capabilities? What is ripe for expansion within the country to support the military industry? As I mentioned before, we're the third-largest defense budget in the world. If you compare this budget with smaller budgets in other countries and if you compare what they have achieved in terms of localization — we have all the ingredients which we need to have in order to make this a success story. We will invest not only in the defense industry, but we also do a big push in the education system in universities, in any kind of area which needs support in order to get this industry up and running, to support the creation of jobs, to fulfill the Vision 2030. SAMI's obligation is to create more than 40,000 direct jobs, more than 100,000 indirect jobs, to achieve the target as defined. Are there things that the United States and other allies can do to better support Saudi Arabia with this military expansion? If there was a wish, we would love to get more access to top-class technologies from all the U.S. partners. There are obviously limitations, which we are suffering from. That's the one element. So be a little bit more open. And second, export in arms and weapons was driven by FMS programs. In our new set up in Saudi Arabia, we will do more and more in direct commercial sales. Why? Because this office has more flexibility, more opportunity for follow-up in the organization in a more time-effective manner. And yes, companies have to be trained, in that they have to change the mindsets and mentality in order to do this kind of normal type of commercial sales activity and to become a commercial partner on an industrial level rather than on a political or governmental level. They'll need to convince the Pentagon to allow them, too, because there's a lot of cases where the Pentagon tends to put in restrictions and wants to be in control of that relationship. You are absolutely right. This is a burden on the U.S. companies, and I wish them all the best in order to overcome the hurdle [so we] will be equally treated as many other companies who are not restricted by their governments. Some western European countries, for example, are offering much more support in that respect. Offering more opportunities for the companies to transfer their ideas, their technologies into the kingdom. Saudi Arabia had a bit of a shakeup in terms of its own military leadership. Where does that stand, if you don't mind my asking, and how does that influence the formation and growth of SAMI? The Vision 2030 program has many elements. So it's a transformation program, not only for society but also for the governmental administration. And as [the armed forces] are part of this administration body, they also have to undergo this transformation process. This is an ongoing process. The first steps have been done. One of the outcomes is the creation and foundation of the new regulatory body, which is the twin to SAMI, to host a centralized procurement agency, which they regulate and control and manage any kind of military and defense-related or security-related procurement action. This will ensure critical mass, synergy effects, volume effects, and allow us to build up a kind of sustainable business. With this kind of transformation, obviously, the roles and the responsibilities of administrative bodies, as well as leaders in the forces, have to change. And in line with that, some people have to be replaced, to be in full support with this new vision and to be completely in line with our targets, and I can tell you we have relationships with all the national stakeholders, and we consider ourselves with them as partners. They are no longer a client, we are no longer vendor to them; we are partners. You mentioned R&D. What areas do you see the greatest potential in terms of investment for development and product development? We will put our focus on software technologies, electronics, microwave, space-based technologies, robotics, laser weapons systems on the midterm and long term, but in in the short term we have to give the short-term needs, which are conventional in nature. So, in the beginning, as all the other companies are doing, are on the classical systems. How do you meld what Saudi Arabia as a nation needs for its own military with the potential for global export? Upmost importance and top priority is the security of the country. That means, yes, our top priority is to serve the needs of our armed forces, and we try in parallel to satisfy also the needs of our strategic partners. In most of the cases those are quite complementary. You see a lot of efforts in the United Arab Emirates to bolster defense. Is there a collaboration between the military organizations that are stood up in a country like UAE and what you're trying to establish in Saudi Arabia? Top leadership of UAE and Saudi Arabia have recently agreed on a strong collaboration on defense, and defense industries, so we are highly encouraged to align our thoughts and to align our strategies with our counterparts in the UAE. This process is ongoing, but we've had very fruitful collaborative talks, and soon we'll hopefully be in a position to announce some great, common achievements. https://www.defensenews.com/interviews/2018/08/27/head-of-saudi-arabias-defense-industry-umbrella-org-talks-vision-2030

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  31 mars 2020 | International, Aérospatial

  FVL: The Army’s 10-Year Plan For FARA Scout

  The Army's urgently developing new air-launched drones, long-range missiles, and electronic architecture to go on the Future Attack Reconnaissance Aircraft that Bell and Sikorsky are vying to build. By SYDNEY J. FREEDBERG JR WASHINGTON: The Army's Future Attack Reconnaissance Aircraft program is much bigger than the two ambitious high-speed helicopters that Bell and Sikorsky will now get more than $1 billion to build. At least five other major moving pieces must come together on time to turn the final aircraft, whoever makes it, into a working weapon: a new Improved Turbine Engine built by GE; helicopter-launched mini-drones called Air Launched Effects (ALE); a new Long-Range Precision Munition (LRPM), with the Israeli Spike-NLOS as the initial version; an Integrated Missile Launcher (IML) to launch both the missile and the drones; and the underlying electronic framework of standards and interfaces to plug it all together, the Modular Open Systems Architecture (MOSA). The Army is “not just focused on the air vehicle, but focused on the weapon system,” said Brig. Gen. Walter Rugen, Future Vertical Lift director at Army Futures Command, in a call this morning with reporters. Here's the current schedule for everything to come together: 2019 April: The Army awarded five contracts for “initial designs” of the FARA aircraft itself. 2020 March: The Army assessed the five initial designs – including each company's ability to deliver on budget and schedule. Yesterday, they chose Bell and Sikorsky to build prototypes. Each company has already received a “digital model” of how their design must conform to the Modular Open Systems Architecture (MOSA), which will allow the government to plug-and-play MOSA-compliant components from any company, not just the manufacturer, over the life of the program, program manager Dan Bailey said: “We, the government, will control the interfaces internal to the aircraft so we can efficiently upgrade.” December: The Army will conduct a Final Design Review of both designs to confirm “that they are postured for success and risk is acceptable,” Bailey said. “After that, they will begin to build the aircraft.” 2021 Bell and Sikorsky build their prototypes. Despite their very different designs, each company must incorporate certain common Government Furnished Equipment (GFE) provide by the Army. That includes a 20mm cannon; the GE T909 Improved Turbine Engine, which will also be retrofitted to existing Apache and Black Hawk helicopters; and the Integrated Munitions Launcher (IML), which will use MOSA interface standards to connect missiles and ALE mini-drones to the aircraft – without having to modify the aircraft each time a new weapon is developed. If the Army's 2021 budget request is approved, this year the service will buy $152 million of Spike NLOS (Non-Line-Of-Sight) missiles from Israel armsmaker Rafael as an interim Long Range Precision Munition. 2022 Bell and Sikorsky begin ground testing of their prototypes. The Army fields Spike-NLOS missiles on existing aircraft across three Combat Aviation Brigades (CABs), providing both immediate combat power and hands-on experience with the technology to refine either the Spike or a competitor into the full-up LRPM. November: The Bell 360 Invictus and Sikorsky Raider-X fly for the first time. Flight testing begins. 2023 Summer: The prototype aircraft move from their builders' test sites to Redstone Arsenal to begin Army flight testing with all-government crews. The Army finalizes its formal requirements for FARA based on how the prototypes actually perform. Fall: The Army conducts a Weapons System Preliminary Design Review – that is, not of the aircraft alone, but of how all the pieces work together – and, in context of that holistic assessment, selects either Bell or Sikorsky to build the aircraft. By December 31st: The Army launches an official Program Of Record (POR) to acquire FARA. While the first few aircraft will cost more, the service's long-term goal is to spend no more than $30 million per FARA, the same price as the current AH-64 Apache gunship. 2024-2025 The Air-Launched Effects (ALE) mini-drones begin to enter service on existing Army aircraft. As with the Spike missile, this early deployment provides both immediate military benefit and the necessary experience to refine the technology for FARA. 2028-2030 The first FARA aircraft enter operational service. The Army hasn't specified how many it ultimately plans to build or for what price. But the Army's Program Executive Officer (PEO) for Aviation, Patrick Mason, told reporters today that “I have no reason to disagree with” widely circulated independent estimates of 300-400 aircraft for $15-20 billion. “We've got a series of gates” over the years, Mason said. “This is a constant assessment as we go through, and this is really the beauty and benefit of the prototyping design of this program: We will get to see both vendors as they go to their final designs and they build their prototype air vehicle, as we simultaneously carry forward [with] the other elements that are part of the FVL ecosystem.” “We're going to see very, very clear indication of the technology maturity, the readiness, and the ability of the prototype aircraft to meet the requirements,” he said. Novel Contracts, Novel Technology, Tight Schedule It's worth delving into some detail on what happened yesterday, when the Army announced that Bell and Sikorsky would get the chance to build competing prototypes of FARA – the Bell 360 Invictus and the Sikorsky Raider-X – while designs from AVX, Boeing, and Karem were rejected. Each of the five companies had received up to $15 million for design work, while Bell and Sikorsky will each get up to $735 million more to build and test their prototypes. The exact figures are competition-sensitive, and each vendor has invested much of its own money in any case. The contracts call for one-third private funding and two-thirds government funding over the design and prototyping phases combined, but the companies have almost certainly outspent the government so far. Technically, FARA program manager Dan Bailey told reporters, “we actually aren't awarding anything at this time.” Instead, last April, all five contenders got Other Transaction Authority Prototyping (OTAP) contracts for both the design and prototyping phases, but with clauses allowing the Army to cut any vendor at any time. It's that option they've just exercised. Rather than making an award, Bailey said, “yesterday, we notified two that we would continue to fund them into Phase 2 and we notified three that we would stop funding them.” (Emphasis ours). This novel approach, among other benefits, is nigh-impossible for losing bidders to appeal against, Rugen said: “There really is no ability to protest per se with the GAO [Government Accountability Office]. There is legal recourse potentially through the courts but, again, our legal team has advised us the risk is low.” That's helpful because – as the JEDI cloud computing contract proves – legal battles can delay Defense Department programs for months. The Army has a tight timeline for FARA, which it sees as essential to fill the gap in its aerial reconnaissance capability left by the retirement of the aging and much-upgraded Bell OH-58 Kiowa. While the competing designs are very different, Army simulations so far show that either would meet the military needs “Both are advanced rotorcraft configurations,” Brig. Gen. Rugen said. “Both did very well with speed, range, endurance at range, in our European scenario.... The power [for] takeoff with payload out of ground effect was also, again, leap-ahead.” The Bell 360 Invictus is basically a conventional helicopter with small wings for added lift, using fly-by-wire and rotor technology developed for the civilian Bell 525. The Sikorsky Raider-X is a compound helicopter with coaxial rotors and a pusher propeller for added thrust, derived from Sikorsky's S-97 Raider – which is a real, flight-testing aircraft – and ultimately the award-winning X2. “The X2 technology continues to impress,” Rugen said. While Bell's design may not have struck some observers as revolutionary, he said, “the efficiency” with which Bell's engineers stripped out every possible bit of drag – allowing much higher speeds – “was truly innovative. “We've got two great competitors ... on a program that we must deliver for the Army,” Rugen said. https://breakingdefense.com/2020/03/fvl-the-armys-10-year-plan-for-fara-scout