By Ann Roosevelt
Boeing [BA] last week received a partial termination order from the Army for the Manned Ground Vehicle (MGV) portion of the Future Combat System (FCS).
The order formally stops the money flow on the MGV, and legally authorizes the Army and Boeing to begin termination proposals and negotiations, Paul Mehney, an Army spokesman, said.
However, the order does not stop work on the active protection system development or testing, which is proceeding according to schedule, he said.
The Non-Line of Sight Cannon continues under a stop work order on the mission module and mission equipment, as it is on a separate, congressionally directed development and fielding schedule.
Boeing and SAIC [SAI] manage the FCS program, now being restructured into the Brigade Combat Team modernization plan, for the Army.
The partial termination for the convenience of the government for the MGV only comes as a result of the Pentagon’s June 23 Acquisition Decision Memorandum on FCS restructuring, following decisions made by Defense Secretary Robert Gates in April to terminate the MGV portion and accelerating and reordering the program’s technology spin outs.
In a statement released yesterday, Boeing said: “We will now begin notifying those partners and suppliers impacted by the order and initiate the termination proposal process with the Army. It would be premature to comment publicly on those discussions at this time.”
General Dynamics [GD] and BAE Systems would be the most affected, as they have been managing and developing the MGV family of vehicles. The partial termination order also allows Boeing to proceed in negotiating termination fees with both companies.
“While this is disappointing, we are encouraged by the Army’s commitment to preserve key technologies and leverage the significant design and development work already accomplished,” the Boeing statement said.
Boeing received the partial termination order July 17, the same day layoff notices began going out to employees working on the FCS program because of the Army’s changed plans. The Boeing SAIC workforce of some 2,000 will be reduced by 30 percent, the companies said (Defense Daily, June 20).
Boeing said it continues to work with the Army to minimize the impact to the program as the contract is restructured.
“Our goal remains the same–getting these networked systems and technologies into the hands of soldiers as soon as possible,” the Boeing statement said.