Rapid Fire 2010-09-01: Flying Road Vehicles

• China’s FY 2010 defense spending increased 7.5% to $78 billion, says Taiwan defense report.

• Up and Down: Wells Fargo upgrades outlook for Raytheon’s shares due to significant international sales by the company, while the investment bank downgrades the outlook for Lockheed Martin’s shares because of tighter DoD budgets.

• The Pentagon is cutting $1.5 billion from the WMD defense budget over the next 5 years; over $1 billion is being moved to fund development of vaccines to combat pandemics, according to a DoD memo obtained by Global Security Newswire.

• India may add another 59 Mi-17 helicopters to its $1.2 billion, 80 helicopter deal from 2008.

• UK commissions its new first-of-class nuclear-powered fast attack submarine as HMS Astute, after many delays and technical issues.

• The US Navy’s last Wasp Class LHD, Makin Island, looks like it will face more delays.

• OSI Systems in Hawthorne, CA gets contract worth up to $12 million to provide research support to the US Domestic Nuclear Detection Office.

• USAF is moving ahead with its program to privatize its military housing, which shifts the financial responsibility of renovation, construction, operation, and maintenance of the housing to the private sector. Latest contract was let to Forest City Enterprises for housing at Shaw AFB and Charleston AFB in South Carolina, Arnold AFB in Tennessee, and Keesler AFB in Mississippi.

• Flying Cars?: Yes, it’s true. DARPA is developing a Transformer military transport vehicle that would also be able to take off and fly like an aircraft to avoid roadside bombs; Lockheed Martin and AAI have been selected to develop it, according Popular Mechanics magazine.

Rapid Fire: 2010-08-31

• French defense industry needs to be rationalized, which includes reducing government funding for defense R&D and encouraging aerospace supplier Safran and defense electronics firm Thales to swap assets, says French defense minister.

• President Obama pledges renewed effort to reform the US export control regime for defense and high-tech goods, including consolidating the Commerce Department’s Commerce Control List and the State Department’s U.S. Munitions List.

• USAF awards a 5-year client computing/server (CCS) blanket purchase agreement (FA8771-10-A-0601) worth up to $800 million to HP to provide business desktops and notebook computers, as well as servers and storage.

• Taiwan to cut 37.5% from funding of classified programs under its proposed FY 2011 budget.

• Do budget cuts herald doom for Britain’s fabled Gurkha Regiment and Black Watch?

• Singapore is sending a UAV task group to Afghanistan. Its Joint UAV Command stood up in 2007.

• New AGM-114R Hellfire tests its multi-mode warhead on a tank, following a recent conversion contract.

• The Center for Public Integrity details allegations of abuse regarding subcontractors in Iraq and Afghanistan.

• Northrop Grumman snags 5-year US Navy contract worth up to $39 million to provide security systems for USMC and other DoD facilities worldwide.

Rapid Fire 2010-08-30: Does Insourcing Save Money?

• Yellow Sea Exercises: The North Sea Fleet (Beihai Fleet) of the Chinese Navy plans to hold live-ammunition naval exercises, from Sept 1 to 4, in the Yellow Sea, located between the China coast and the Korean peninsula.

• Set Them Free: Japanese advisory panel to the prime minister recommends lifting export ban on Japanese defense company so they can participate in international projects.

• The US is using South Korean funds, originally contributed by Seoul to bolster joint defense capabilities, to pay for the $9.1 billion move of the US military headquarters from Seoul to Pyeongtaek, according to South Korean government sources quoted in JoongAng Daily.

• Philippine President Aquino is proposing to spend 5 billion Philippines pesos ($111 million) on modernizing the country’s armed forces in FY 2011, including upgrading the air force’s fleet of S-211 jet trainers made by Italy’s Aermacchi.

• BAE Systems opens its new vehicle design and prototyping facility in Sterling Height, MI.

• Former US government contractor Stephen Jin-woo Kim faces US federal charges for allegedly leaking information from a top secret intelligence report on North Korea to a Fox News reporter.

• Does in-sourcing work save DoD money? A Huntsville Times reporter examines the issue.

US Navy Issues Ordnance Management System Contracts

AGM-154 JSOW, loading

The US Fleet and Industrial Supply Center Norfolk Contracting Department’s Philadelphia Office recently awarded a trio of contracts that provide program management and technical support services for the Naval Operational Logistics support Center’s Ordnance Information System, which is used for the important job of tracking US Navy ammunition, bombs, missiles, etc. located around the world.

The 3 contracts were competitively procured via Navy Electronic Commerce On-line, with 5 offers received. They are all 1-year contracts running to September 2011, with 4 one-year option year periods after that:

I Guess They Can’t Be…

Small business qualifier Can’t Be Beat Fence & Construction, LLC in Perkinston, MS recently won a $12.1 million firm-fixed-price contract to design and build an addition to the existing Strategic Weapons System Engineering Facility (Building 3334), at Naval Support Activity Crane, IN. The contract also contains 5 unexercised options which could increase cumulative contract value to $13.1 million.

Work will be performed in Crane, IN, and is expected to be complete by January 2012. The addition will include open systems engineering labs; an analysis lab; test and evaluation labs; engineering and logistics support areas; secured space; shipping/receiving; conference rooms; a lunch/break room; restrooms; a mechanical room, and intrusion detection system and access controls. Special features will include 400 Hz power; controlled lab spaces; a dry air/nitrogen distribution system; a fire protection system; and information system.

This contract was competitively procured via the Navy Electronic Commerce Online website, with 15 proposals received by the Naval Facilities Engineering Command, Midwest in Great Lakes, IL (N40083-10-C-0022).

India to Buy 80 Mi-17v5 Helicopters

Indian Mi-17s

In October 2006, the Indo-Asian News Service reported that the Indian Air Force will buy 80 medium lift multi-role Mi-17 1V helicopters from Russia. India’s Chief of Air Staff Marshal S.P. Tyagi reportedly told the news agency that the contractual detail would be finalized within a few months, that Russia will start delivering the helicopters in 2007, and that deliveries would finish within a year. MosNews estimated the deal’s value at approximately $662 million, with the exact value depending on ancillary equipment like avionics.

The deal is the result of a dance over time involving both Sikorsky and India’s HAL, and the Mi-17 1V incorporates a few changes to the well-known Mi-17 already in service with India. Of course, “a couple of months” in Indian procurement time turns out to be over 2 years – and in a now-familiar scenario, Russia ended up asking for about double the originally agreed deal terms. Nevertheless, a deal is now done.

Rapid Fire: 2010-08-27

• Try Again: US Army cancels competition for development of the next-generation Ground Combat Vehicle IFV (Infantry Fighting Vehicle) after review by Pentagon acquisition officials; revised rules for a more affordable program expected in 60 days.

• 10% Off Everything: US Defense Logistics Agency wants a 10% price reduction from contractors.

• Cyber Allies: The Pentagon unveils new cybersecurity strategy that includes a call for collective cyber defense among allies; not everyone is impressed.

• Yemen Bound: The Pentagon says it notified Congress that it plans to spend $155 million on 4 Huey helicopters, upgrades to 10 Russian-made Mi-17 medium transport helicopters, and 50 Hummers, as well as night vision goggles and transport aircraft for the Yemen Army to fight al-Qaeda.

• NATO special forces have killed 365 insurgent commanders in Afghanistan in the past 3 months, according to a report in Der Spiegel.

Decoding the UK’s Defence Dilemma

Guest article by Ian P. Wilson, Grant Thornton UK LLP

Given unprecedented fiscal pressures inherited by the new UK Government, there is an increasing recognition that the UK will have to reassess how it seeks to assert itself militarily. Given the poor condition of the country’s public finances, it is a widely-held view that the UK simply cannot afford to buy and support military assets to simultaneously project air, sea and land force capabilities on a global scale; nor can it expect to address several major conflicts while maintaining effective security at home.

As it proceeds with its promised 2010 Strategic Defence and Security Review (SDSR), the new UK Government faces the dilemma of having to fund a fundamental realignment and upgrade of the country’s defence and security infrastructure, whilst seeking to reduce a record fiscal deficit. Inevitably, priorities will have to be determined and certain programmes will face cancellation or curtailment…

• 1. A Changing World
  
• 2. The Big Questions
  
• 3. Defence procurement priorities – our view
  
• Additional Readings
  

Safeguarding Your Security Clearance

By Evan H. Lesser, Co-founder and Managing Director, ClearanceJobs.com

With some economists predicting as much as half a decade until U.S. unemployment lowers to the historical norm of 5%, this will not be an equitable jobs recovery and in certain industries – some jobs are likely gone for good. Unlike the sectors hit hard by the recession, the U.S. defense, homeland security, and intelligence industry has been largely untouched by the economic slowdown. Bolstered by the largest line items in the Federal budget, the business of protecting the U.S. and our foreign interests is characterized by its tight labor pool. In particular, workers with active Federal security clearance remain in high demand. With more open jobs than qualified candidates to fill them, security-cleared professionals in the defense and intelligence industry remain in an enviable career position. Simply put, a security clearance opens more than just doors to classified information – it opens doors to a secure career.

However, just because a worker has received a security clearance does not mean they have the ability to maintain it. Periodic reinvestigations of clearance holders are designed to ensure cleared professionals remain suitable for access to classified information. If the results of a cleared worker’s reinvestigation are unfavorable, their security clearance can be revoked, leaving the worker without a job and a valuable career asset…

Rapid Fire: 2010-08-26

• Flash Dance: A flash drive that uploaded malicious code into the US Central Command network in 2008 provided an unidentified foreign intelligence service with undetected access to classified US information, admits a US Pentagon official in a Foreign Affairs article.

• Russian Buffer: Russia is beefing up its military presence in the Caucasus and the Black Sea region in an effort to create a security buffer zone, a Turkish analyst says.

• Low Tech Jarheads: Forget night vision goggles, laptop computers, GPS devices, and robots, US Marines are training to fight in the mountains of Afghanistan using compasses, ropes, pack animals, and communication equipment made out of plastic spoons, string and wire.

• Trimming Sails: Northrop Grumman says it plans to lay off 642 workers at its Pascagoula, MS shipyard by the end of the year, in addition to 400 layoffs undertaken in May, despite plans to move construction of 2 LPD-17 San Antonio amphibious assault ships there.

• Shutting down of contractor-heavy DoD agencies and commands is a blow to the IT industry, writes National Defense magazine.

• Pentagon comptroller Hale expects a 1% growth in the DoD budget in FY 2012.