Silicon Valley. The non-profit Silicon Valley Defense Group (SVDG) is urging Congress to retain a House-passed provision in the final fiscal year 2024 defense appropriations legislation to provide $1 billion for Defense Innovation Unit to establish a Non-Traditional Innovation Fielding Enterprise (NIFE) hedge-fund portfolio. In an Oct. 24 letter to the leaders of the House and Senate Appropriations Committees, the group also calls on Congress to include a directive in the final FY ‘24 National Defense Authorization act proposed in the House’s version of the defense policy bill that authorizes establishing the NIFE. “Increased collaboration with non-traditional and commercial industry begins with greater connectivity within the department. We believe the enactment of this provision, coupled with the robust funding proposed by the House bill, will lead to greater coordination across the department and serve as a powerful demand signal to non-traditional and commercial companies to work with DoD,” SVDG wrote in its letter.
Rheinmetall/Ukraine.
Germany’s Rheinmetall has officially established a new joint venture with Ukrainian state-owned defense firm Ukrainian Defense Industry JSC (UDI), formerly known as Ukroboronprom. “The joint venture will be active in the fields of service and maintenance as well as assembly, production and development of military vehicles and will initially operate solely on Ukrainian sovereign territory,” Rheinmetall said in a statement. “Ukraine stands to benefit from this cooperation in multiple ways, including the creation and expansion of defense technology capacities in-country, additional local added value as well as the swift delivery of military equipment from Germany.” Rheinmetall owns a 51 percent stake in the new Rheinmetall Ukrainian Defense Industry LLC, while UDI holds the remaining 49 percent.
New Speaker. Rep. Mike Rogers (R-Ala.), chair of the House Armed Services Committee, offered a statement in support of HASC Member Mike Johnson’s (R-La.) election as the new Speaker of the House on Oct. 25. “The election of Mike Johnson as Speaker of the House sends a strong message to our adversaries. As a member of the House Armed Services Committee, he has a deep knowledge of the threats facing our nation and has a proven track record in working to counter those threats, particularly from China,” Rogers said in a statement. Johnson, who served on HASC’s Readiness and Seapower Subcommittees, has indicated he wants the House to pass a final conferenced version of the fiscal year 2024 National Defense Authorization Act (NDAA) in December. “Every member of this committee understands how critical the National Defense Authorization Act is for our national security, Mike is no different. The NDAA boosts our national defense, provides for our servicemembers, and deters our adversaries. I look forward to working with Speaker Johnson to advance the National Defense Authorization Act later this year,” Rogers said.
CBO Report. A new report from the Congressional Budget Office (CBO) finds the Pentagon may be underestimating its costs in its 2024 Future Years Defense Program (FYDP), which projects spending levels in the coming years. The CBO report notes the new FYDP projects DoD’s budgets will remain relatively flat, when adjusted for inflation, through 2028. In projecting out to 2038, and without factoring for inflation, the FYDP projects DoD’s costs would reach $922 billion. The report finds that if DoD’s FYDP “grew at rates consistent with CBO’s economic forecast,” the department’s cost would be three percent higher from 2024 to 2028 and about four percent higher from 2024 to 2038. “To accommodate higher costs, DoD would need to scale back its plans or request larger budgets than are anticipated in the 2024 FYDP,” the CBO writes in its report.
Taiwan Letter. Rep. Mike Gallagher (R-Wis.), chairman of the House Select Committee on China, and Rep. Young Kim (R-Calif.), chairwoman of the House Foreign Affairs Committee’s Indo Pacific Subcommittee sent a letter to Secretary of the Navy Carlos Del Toro this week pressing the Navy to quicken production and sales of weapons to Taiwan. They highlighted delays in entering into contracts and RFPs for approved Harpoon missiles, Harpoon Coastal Defense Systems, and Harpoon AGM-84K SLAM-ER (extended range) missiles. The House members argued the pace of contracting, production and delivery does not match military leadership rhetoric on the danger of China potentially invading Taiwan in the near to medium term.
…Accelerate? Gallagher and Kim’s letter asked Del Toro when he expects the delivery of these hundreds of missiles and systems to be finished, what the status of Requests for Proposals are, how can they get on contract as quickly as possible, how likely budgets for these weapons will exceed Taiwan’s Letter of Acceptance given inflation issues, and how can production and delivery be accelerated.
LCS-28 Demo. The USS Savannah (LCS-28) Independence-variant Littoral Combat Ship demonstrated a containerized launch system to fire an SM-6 at a surface target, the Navy announced on Oct. 25. The service argued this demonstrated the “modularity and lethality” of LCSs with their ability to integrate a containerized weapon system. The Navy said this exercise will inform future testing, evaluation and integrations of containerized weapons systems on afloat platforms generally.
DDG-125. The first Flight III Arleigh Burke-class guided-missile destroyer, USS Jack H. Lucas (DDG-125), arrived at its new homeport of San Diego on Oct. 25. The ship was commissioned on Oct. 7 in Tampa and is now assigned to the U.S. 3rd Fleet. The trip from Tampa to San Diego, which had the ship transit the Panama Canal, entailed several drills, checks and a missile launch using the ship’s radar and weapons system. The ship is set to next undergo several tests to evaluate combat readiness and effectiveness. As the first Flight II ship, it features several changes to accommodate the RTX SPY-6 Air and Missile Defense Radar.
DDG-61 Maintenance. The Navy awarded NAE Systems’ Jacksonville Ship Repair an $83 million contract action for the maintenance, modernization and repair of the Arleigh Burke-class destroyer USS Ramage (DDG-61) during a fiscal year 2024 docking selected restricted availability. The award announcement said this award includes all the labor, supervision, equipment, production, testing, facilities, and quality assurance necessary to prepare for, and accomplish, the Chief of Naval Operations Availability for critical modernization, maintenance and repair programs, The construct includes options that, if exercised, would raise the total value to nearly $93 million. The work will occur in Mayport, Fla., and is expected to be finished by April 2025. While this award was competitively procured with three offers received, the Navy did not disclose the other competitors. The announcement did not say if the competition was limited to offerors on the East Coast.
Norfolk Dry Dock 4. The Navy awarded Cianbro Corp. a contract worth upward of $112 million on Oct. 23 for the design-bid-build for construction of a new Dry Dock 4 Refueling Complex at the Norfolk Naval Shipyard in Virginia. The contract is part of the 20 year-long Shipyard Infrastructure Optimization Program (SIOP) that seeks to update and improve the Navy’s four public shipyards that service the Navy’s nuclear-powered naval vessels: all submarines and aircraft carriers. The announcement said the base price as well as the first two options for this contract will be awarded for $109 million with an award fee in the mount of $3.6 million, leading to the total obligated amount of $112 million. The work is expected to be finished by December 2025. DoD said the contract was competitively procured but it only received this one offer.
Mojo Risin. Melissa Johnson is U.S. Special Operations Command’s (SOCOM) new acquisition executive, replacing Jim Smith. Johnson had been the deputy director of the Air Force’s Rapid Capabilities Office in Washington, D.C., since October 2020. As an active duty Air Force colonel, “Mojo” Johnson served as SOCOM’s program executive officer for fixed wing programs at MacDill AFB, Fla. from June 2017 to July 2020. In that role, she oversaw more than 100 special operations forces acquisition programs.
AFRL/Space Force CRADA. Air Force Research Laboratory (AFRL) scientists spearheaded the first non-domestic Cooperative Research and Development Agreement between U.S. Space Force, AFRL’s space vehicles directorate, and two Indian start-up companies, 114AI, which turns out dual-use artificial intelligence (AI) software for domain awareness, and 3rd ITECH, the country’s only image sensor company, AFRL said. “The CRADA will foster collaborative efforts in cutting-edge technologies, marking a significant milestone in advancing innovation in Earth observation sensors and space domain awareness,” AFRL said.
…INDUS-X. After a June 22 visit to the White House by Indian Prime Minister Narendra Modi, he and Pres. Joe Biden issued a joint statement that mentioned the CRADA and said that both Indian companies will work with General Atomics “to co-develop components using cutting edge technologies in AI and semiconductors.” Modi and Biden also noted India’s buy of General Atomics MQ-9B high altitude long endurance drones and the launch of the U.S.-India Defense Acceleration Ecosystem (INDUS-X) among universities, startups, industry and think tanks. INDUS-X “will facilitate joint defense technology innovation, and co-production of advanced defense technology between the respective industries of the two countries,” Modi and Biden said.
Risk Management. Northrop Grumman Chairwoman, President and CEO Kathy Warden last week said the company approach to bidding on fixed-price development contracts and their risk-reward profile depends on how much risk reduction has already been accomplished. In the case of the company’s win this year of the Air Force’s Stand-in Attack Weapon (SiAW), she said the company pursued the air-to-ground weapon because its approach builds on mature technical and product capabilities found in its Advanced Anti-Radiation Guided Missile (AARGM) and AARGM-Extended Range missiles. “We are able to reduce cost, schedule, and of course have better risk management,” she said during the company’s third quarter earnings call last Thursday. “That allows us to have the risk tolerance then to bid fixed-price.”
…Kubasik’s Take. L3Harris Chairman and CEO Chris Kubasik said last Friday that his company will not bid fixed-price development contract that “simultaneously ask for development and production,” adding that estimating development work is “hard enough,” not to mention committing to production lots several years out. It is the customer’s right to use the contract vehicle they want, but, eventually “I think at some point in time, everyone in the industry will stop bidding and we’ll get the right vehicle and we’ll fight it out for the best solution,” he said during the company’s earnings call. L3Harris will trade sales growth for “profitability, cash, and margin, and…the best way to get your margins up, stop writing off money on programs. And that moves the needle,” he said.
Iron Dome Boost. RTX and Israel’s Rafael Advanced Defense Systems are building a new $33 million manufacturing plant in East Camden, Ark., to produce Tamir missiles for the Iron Dome medium-range air defense system and its U.S. variant, SkyHunter. The companies have work together on Iron Dome for more than 10 years. “This new Camden site will be the first all-up-round production facility in the U.S. to help support the Armed Forces and allies across the globe with this highly capable air defense missile,” Tom Laliberty, president of Raytheon’s Land & Air Defense Systems and chairman of the Raytheon-Rafael Area Protection System joint venture. Ground breaking on the facility is expected later this year with missile production slated to begin in 2025. The plant will produce missiles for the U.S. Marine Corps and allied partners. Israel has been using its Iron Dome systems to help defense against rocket and missile attacks from Hamas and other militants in the Gaza Strip and Hezbollah in Lebanon the past three weeks.
People News. HII has named retired British army Brig. Gen. Paul Tenant as corporate vice president of engagement and international government relations, reporting to Stewart Holmes, the company’s executive vice president of government and customer relations. Tenant will work from HII’s Arlington, Va., office and will lead government and customer relations international initiatives, including the Australia, United Kingdom, and United States partnership, better known as AUKUS. Peraton has appointed William “Bill” Mertz as senior vice president and chief procurement officer. Previously, he was vice president of enterprise supply chain at CACI International. Mertz will oversee the procurement team, including business systems compliance, strategic sourcing, positive cash flow management, and subcontractor management.
OPC Christened. The Coast Guard’s first medium-endurance offshore patrol cutter (OPC), the USCGC ARGUS (WMSM-915), was christened last Friday at Eastern Shipbuilding Group’s Nelson Facility in Panama City, Fla. The first Heritage-class cutter is expected to be delivered in a year. The Coast Guard plans to acquire 25 OPCs. Eastern Shipbuilding is constructing the first four ships and Austal the next 11.
DHS Support. LMI last week said it has received a potential five-year, $604 million contract to support the Border Patrol’s Program Management Office Directorate, the largest award ever for the management consultancy. LMI will help the directorate modernize and expand its technology capabilities across the northern and southern borders. The support includes program management, lifecycle logistics management, technical and engineering support, and environmental planning support. LMI will also support all the Border Patrol’s headquarters directorates.