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Industry News

News from Washington

July 1, 1999
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News from Washington

Joint STARS Upgrade Contract Awarded

Northrop-Grumman Corp.'s Integrated Systems and Aerostructures Sector has received an indefinite-delivery/indefinite-quantity contract with a potential value of $1.2 B from the US Air Force for upgrade work on the Joint Surveillance Target Attack Radar System (Joint STARS), which extends through March 2005. The recent contract is separate from the Radar Technology Insertion Program (RTIP) preplanned product improvement contract that Northrop Grumman was awarded in December 1998 to develop next-generation advances for Joint STARS. With the value of the RTIP expected to exceed $1.3 B, the combined Joint STARS awards have a potential value of $2.5 B.

The first project to be initiated under the new contract will be the development of an integrated satellite communications system for Joint STARS - an effort valued at approximately $40 M. The E-8C Joint STARS airborne surveillance and target acquisition system provides real-time information about vehicles on the ground and slow-moving aircraft for peacekeeping missions and battlefield decision-making. The system is currently deployed with the NATO forces in Kosovo.

Boeing Selected to Build UCAV Demonstrator System

The Defense Advanced Research Projects Agency (DARPA) and the US Air Force have selected The Boeing Company, Phantom Works, Seattle, WA and St. Louis, MO, to continue into the second phase of the Unmanned Air Combat Vehicle (UCAV) Advanced Technology Demonstration (ATD) Program. Boeing Phantom Works will design, fabricate and flight test its UCAV demonstrator system during a 42-month, $131 M cost-shared effort.

The goal of the joint DARPA/Air Force UCAV ATD program is to demonstrate the technical feasibility for a UCAV system to effectively and affordably perform 21st century Suppression of Enemy Air Defenses and strike missions. Three industry teams participated in the first phase of the program, completing exhaustive mission effectiveness and affordability trades to optimize their operational systems design, identifying critical technologies and issues, and planning their phase II demonstration programs.

The UCAV ATD is the next step on a path toward a revolutionary weapon system that will augment future manned weapon systems as part of an integrated, post-2010 force structure. The Boeing UCAV concept exploits real-time, on-board and off-board sensors to detect, identify and locate fixed, relocatable and mobile targets. Secure communications and advanced cognitive decision aids will provide human operators with the situational awareness and positive air vehicle control necessary to authorize munitions release. The tailless, stealthy air vehicle to be demonstrated is expected to carry multiple advanced, precision-guided munitions and relay battlefield damage information to the mission control system. Maintained in ready-to-ship containers, the UCAV system is also expected to be capable of global deployment and operation in concert with manned Air Expeditionary Forces.

Navy Directed to Spend $100 M for Land Attack Missile

Defense Daily reports that Jacques Gansler, Pentagon acquisition chief, has directed the US Navy to spend $100 M to develop an advanced land attack missile in FY 2001 and 2002. The Navy has said that affordability caused it to select Raytheon's Land Attack Standard Missile (LASM) instead of a naval version of Lockheed Martin's Army Tactical Missile System (ATACMS) as its near-term fire support solution for Arleigh Burke-class (DDG-51) destroyers and Ticonderoga-class (CG-47) cruisers.

A May memo from Gansler agreed with the Navy's plan to develop the LASM in the near term only if at least $50 M per year in FY 2001 and FY 2002 are allocated for an alternative land attack missile. Further, he recommended that at least 75 percent of those funds be devoted to modification of the ATACMS for the vertical launch tubes aboard the Arleigh Burke destroyers.

Status of Army Materiel Command Personnel Reduction Efforts Reviewed

The 1997 Report of the Quadrennial Defense Review (QDR) has directed the US Army to reduce personnel to free up funds to be used to modernize its force. It was expected that the Army Materiel Command (AMC) could significantly reduce the number of civilian personnel by increasing its reliance on the private sector. In its report required by the Strom Thurmond National Defense Authorization Act for FY 1999, "Status of Efforts to Implement Personnel Reductions in the Army Materiel Command" (GAO/NSIAD-99-123), the General Accounting Office (GAO) examines AMC's plans and time frame for achieving the reductions, the cost savings projected for such reductions and the cited impacts the reductions will have on workload and readiness.

According to the report, AMC has identified 8530 civilian positions that will be eliminated by FY 2004 as mandated by the QDR. Most of these reductions appear to be based on organizational changes, improved operating efficiencies and anticipated future workload decreases rather than on the level of competitive sourcing anticipated by the review. Actions to achieve the majority of the 20 percent of the reductions expected over the next two years are underway. Plans for the 80-percent reductions expected to take place in FY 2001 through 2004 are still being finalized and some have serious uncertainties.

Original Army savings estimates for the personnel reductions indicated $1.4 B in cumulative savings from FY 1999 through 2004 and $589 M annual savings thereafter. GAO's analysis concludes that both the short- and long-term savings will fall short of their estimates and suggests that shortfalls will be due largely to the omission of investment costs necessary to achieve the savings. These costs include items like personnel separation costs arising from implementing reductions. In addition, some savings could be delayed by the longer than anticipated time required to complete and implement competitive sourcing studies. Savings through FY 2005 are also overstated because higher than average civilian salaries were used to compute the savings.

GAO feels that the impact of workload and readiness is impossible to determine until most of the planned reductions are completed by 2004. The report fails to make any recommendations since GAO finds that the AMC has sufficient options to achieve its reduction goals by 2004. However, the conclusion was made that the savings estimates associated with the reductions are overstated.

MEADS Development Team Selected

Defense Daily reports that representatives of the US, Germany and Italy have selected a Lockheed Martin-led team to develop the technologies needed for the Medium Extended Air Defense System (MEADS). Lockheed Martin's MEADS team, which includes Germany's DaimlerChrysler Aerospace and Italy's Alenia, will be awarded a contract with a potential value of $250 M for the risk-reduction phase of the program scheduled to begin this summer. The US Ballistic Missile Defense Organization is leading the US portion of the effort to develop a mobile defense system against ballistic, cruise and air attack that could be based on Raytheon's PATRIOT Advanced Capability-3 (PAC-3) system. While the initial MEADS concept was to develop a new missile with a significantly wider performance envelope than the PAC-3, Germany and Italy agreed to a restructured program that could be based on the PAC-3 missile, a system tailored for high flying missile interception. The agreement followed a US finding that the new missile would probably cost twice the $2.5 B estimated by the NATO MEADS program office and a resulting threat to drop out of the program unless it used the PAC-3 as its basis.

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