19 août 2020 | International, Aérospatial, Naval, Terrestre, C4ISR, Sécurité
By: Mike Gruss
One way to understand how the United States' largest defense companies are responding to the coronavirus pandemic is to listen to what their leaders said on the most recent round of earnings calls.
Consider this anecdote from General Dynamics.
Phebe Novakovic, the company's chief executive, told analysts in late July that when COVID-19 struck, “our classified customers closed their sites to all but mission-essential employees. This impacted revenue and earnings and will continue to do so. Some of IT services' highest-margin programs have come to a hard stop because of COVID-19.”
Novakovic described the pandemic as a time of “significant uncertainty.”
That story was not unusual.
David Calhoun, Boeing's CEO, described this as “a historically dynamic and challenging time.” Greg Hayes, Raytheon Technologies' top executive, opened his second-quarter call by stating: “As everyone knows, these last several months have been incredibly challenging.” And Bill Brown, the CEO of L3Harris, said: “The pandemic has challenged us all to find new ways of working effectively.”
To be clear, defense contractors have lost roughly 20 percent of their value in the last six months, by tracking exchange-traded funds. That's the worst run for publicly traded companies in at least a decade.
So what to make of this?
James Taiclet, Lockheed Martin's new leader, said his philosophy is that there may be “an opportunity for us if there is a downturn, we're going to look at the silver linings that may be there.” He was talking about mergers and acquisitions.
But defense companies of all sizes should look for another opportunity: a reason to operate differently, not an excuse to get back to basics. Leaders should reexamine how to embrace new talent, how to effectively telework, and how to add new equipment or partnerships with unexpected sources.
Military leaders for years have said they value agility. Now they will get to watch firsthand who changes, who is prepared for the long term, who adapts and who merely talks about adapting. These “challenges” can give acquisition officials a reason to reward agility.
But back to the earnings calls. Officials hinted about what may happen next, before we — fingers crossed — enter a post-pandemic world. Lockheed's Kenneth Possenriede, the company's chief financial officer, said that while solicitations may be slower getting out the door, final deadlines have not changed.
Brown at L3Harris said: “We believe that the heightened threat environment will drive the trajectory of U.S military spending regardless of the election.”
Novakovic seconded that notion. “There's a general consensus that the threat has not dissipated,” she said. “In fact, arguably some of our potential adversaries have raised additional questions. ... We'll see going forward, but [I'm] not hearing a lot at the grassroots level on ... any pending defense cuts.”
The threat may not have changed. Nor may the business of defense. Yet.
But it's impossible to ignore that almost everything else has.
25 novembre 2024 | International, Aérospatial
The US Department of Defense (DoD) is considering revising the 2022 Nuclear Posture Review to maintain effective nuclear deterrence amid perceived growing threats from China and Russia and the potential absence of nuclear arms control agreements after February 2025.
14 janvier 2020 | International, Aérospatial, Naval, Terrestre, C4ISR, Sécurité
NAVY AgustaWestland Philadelphia Corp., Philadelphia, Pennsylvania, is awarded a $176,472,608 firm-fixed-price contract for the production and delivery of 32 TH-73A aircraft, initial spares, peculiar support equipment, flyaway kits, hoists, sling loads, data in excess of commercial form fit function/operations maintenance instructional training data as well as ancillary instructor pilot and maintenance personnel training. Work will be performed at Philadelphia, Pennsylvania (87%); Mineral Wells, Texas (5%); and various locations outside the continental U.S. (8%), and is expected to be completed in October 2021. Fiscal 2020 aircraft procurement (Navy) funds in the amount of $176,472,608 will be obligated at time of award, none of which will expire at the end of the current fiscal year. This contract was competitively procured via an electronic request for proposal; five offers were received. The Naval Air Systems Command, Patuxent River, Maryland, is the contracting activity (N61340-20-C-0007). Airbus Helicopters Inc., Grand Prairie, Texas, is awarded a $37,729,000 firm-fixed-price indefinite-delivery/indefinite-quantity contract. This contract provides performance-based logistics support to include ground and repair maintenance of five UH-72 aircraft, sustaining engineering required to maintain UH-72 Federal Aviation Administration certification, the incorporation of U.S. Navy Test Pilot School specific modifications, and the support to provide ground and flight training for the UH-72/EC-145 aircraft. Work will be performed in Patuxent River, Maryland, and is expected to be completed in January 2025. No funds will be obligated at the time of award. Funds will be obligated on individual orders as they are issued. This contract was not competitively procured pursuant to Federal Acquisition Regulation 6.302-1. The Naval Air Warfare Center Aircraft Division, Patuxent River, Maryland, is the contracting activity (N00421-20-D-0010). C.E.R. Inc.,* Baltimore, Maryland, is awarded a $12,886,000 firm-fixed-price task order (N4008020F4121) under a multiple award construction contract for Gambo Creek Bridge replacement at Naval Support Facility Dahlgren. The work to be performed provides for a design build project to remove and replace Gambo Creek Bridge on Tisdale Road with a reinforced concrete bridge structure that complies with the Federal Highway Administration lane widths for two way traffic. Work will be performed in Dahlgren, Virginia, and is expected to be completed by November 2022. Fiscal 2020 operations and maintenance (Navy) contract funds in the amount of $12,886,000 are obligated on this award and will expire at the end of the current fiscal year. Five proposals were received for this task order. Naval Facilities Engineering Command Washington, Public Works Department, South Potomac, Dahlgren, Virginia, is the contracting activity (N40080-19-D-0011). DRS Systems Inc., Melbourne, Florida, is awarded a $7,660,583 modification (P00001) to a cost-plus-fixed-fee, cost reimbursable delivery order (N0001919F2730) against a previously issued basic ordering agreement (N00019-19-G-0030). This modification provides program management, engineering and logistics support to mitigate identified risks to the Distributed Aperture Infrared Countermeasure program. Work will be performed in Dallas, Texas (70%); San Diego, California (27%); and Fort Walton Beach, Florida (3%), and is expected to be completed in December 2020. Fiscal 2019 research, development, test and evaluation (Navy) funds in the amount of $2,670,597; and fiscal 2020 research, development, test and evaluation (Navy) funds in the amount of $3,798,000 will be obligated at time of award, $2,670,597 of which will expire at the end of the current fiscal year. The Naval Air Systems Command, Patuxent River, Maryland, is the contracting activity. AIR FORCE Raytheon Missile Systems Co., Tucson, Arizona, has been awarded a $10,593,360 modification P00001 to previously awarded contract FA8675-20-C-0033 for Advanced Medium Range Air-to-Air Missile Production Lot 33 spares. This contract modification provides for the production Air Force and Navy spares. Work will be performed at Tucson, Arizona, with an expected completion date of March 31, 2022. Fiscal 2018 Air Force procurement funds in the amount of $1,730,203; and fiscal 2020 Navy procurement funds in the amount of $8,863,157 are being obligated at the time of award. Total cumulative face value of the contract is $778,877,267. The Air Force Life Cycle Management Center, Eglin Air Force Base, Florida, is the contracting activity. (Awarded Jan. 10, 2020) *Small Business https://www.defense.gov/Newsroom/Contracts/Contract/Article/2056101/source/GovDelivery/
19 mai 2024 | International, Terrestre
Polaris developed two new MRZR Alpha variants that support using more payloads in the field: a power export variant, and a heavy payload variant.