Category: Defense Procurement

Scrapping the Zumwalt

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Gene Taylor (D-MS), hairman of the House Armed Services Committee’s seapower subcommittee, is proposing scrap the Zumwalt class (DDG-1000), and replace it with an additional LPD and two resupply ships. The senior Republican on the subcommittee, Rosco “Neanderthal” Bartlett (R-MD), agrees.

I tend to agree. The Zumwalts are too large, too expensive, and too ambitious. They add nothing in overall capability, their weapons and sensor capability will not differ from their predecessors, so all their size gets is a larger store of weapons, at the cost of reduced coverage, since more smaller ships can cover different areas simultaneously.

They are also both pushing for more nuclear combatants, including a scheme to make the Arleigh Burke’s nuclear powered, which I’m rather dubious of.

KC-45 Tanker: NG Harshing on Boeing Again

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Another Northrop-Grumman Press Release:

Northrop Grumman KC-45: Why We Won – Development Cost

Highlighting Reasons the U.S. Air Force Selected the KC-45 Tanker as Best for Our Men and Women in Uniform

WASHINGTON – May 12, 2008 – The U.S. Air Force found Northrop Grumman Corporation’s (NYSE:NOC) bid to build the next generation of aerial refueling tankers superior to Boeing’s in four of the five most important selection criteria. Despite this fact, the losing bidder wants the Government Accountability Office to overturn the Air Force decision to award the contract to Northrop Grumman even though the Air Force conducted what even Boeing described as a fair, open and transparent bidding process. Here is another reason Northrop Grumman won, drawn from a list of facts included in a redacted version of a protected Air Force selection document.

Development and Production Costs

When the Pentagon considers proposals from defense contractors, one of the key elements of its decision is whether the project can come in on time and on budget. Acquisition planners will frequently take cost estimates provided by the prospective contractor and either raise or lower them, based on the U.S. Defense Department’s assessment of whether those cost predictions are likely to be accurate.

For the system development and demonstration portion of the program, the Air Force concluded that Northrop Grumman was at “low risk” of coming in over budget or not meeting its production timetable, while Boeing was rated “moderate risk.” Many of the reasons Boeing was rated a higher risk than Northrop Grumman are redacted for business competition reasons, but Air Force guidelines state that a “moderate risk” rating would occur if “Some difference exists between the offeror’s proposed cost/price and the government’s probable cost/price that is not reasonably explained.”

A key reason why the Air Force could assign lower development risk to Northrop Grumman is that Northrop Grumman has already built, flown and tested a prototype refueling tanker. In all, the Northrop Grumman tanker has flown 73 flights and spent more than 200 hours airborne. The KC-45 team has also conducted a successful fuel transfer test from its boom to an F-16.

By contrast, Boeing’s aircraft hasn’t been built, and exists only in its design phase. The proposed new boom also has not been built, tested or certified. Boeing is also late on delivering a different version of the KC-767 tanker to both Italy and Japan.

For the production portion of the contract, the Air Force noted that, for the Northrop Grumman offer, “Substantially less funds required to develop and buy the first 68 in support of Air Force tanker recapitalization efforts.”

The Air Force also said it “Estimated Northrop Grumman as … less than Boeing in out-year production,” meaning that it believes Northrop Grumman’s production costs would remain lower than Boeing’s for the life of the contract.

In the document explaining its decision, the Air Force noted that “Northrop Grumman’s more advantageous cost/price proposal was a discriminator” in picking Northrop Grumman. The KC-45 offered more capability at a lower unit cost than the KC-767 to provide the Air Force with the best value.

About the KC-45

The KC-45 Tanker aircraft will be assembled in Mobile, Ala., and the KC-45 team will employ 48,000 American workers at 230 U.S. companies in 49 states. It will be built by a world-class industrial team led by Northrop Grumman, and includes EADS North America, General Electric Aviation and Sargent Fletcher.

Northrop Grumman Corporation is a global defense and technology company whose 120,000 employees provide innovative systems, products, and solutions in information and services, electronics, aerospace and shipbuilding to government and commercial customers worldwide.

(emphasis mine)

Lately, Boeing has had an record of over budget, behind schedule, and under performance that boggles the mind, and NG is just pointing it out.

If at First You Don’t Succeed, Hire Retired Generals

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Lockheed-Martin, the manufacturer of the “troubled” Joint Air to Surface Standoff Missile (JASSM) has recieved authoriziation from the DoD to proceed on development and production.

It should have been canceled long ago. Not only are there other systems that do much the same thing, MBDA Storm Shadow or Taurus KEPD 350 come to mind, but the missile has escalated in cost beyond reason while showing real reliability problems.

We have yet another case of a defense contractor failing upward.

Murtha Proposes Giving Army $20B to Cancel FCS

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John Murtha, chairman of the Defense Appropriations Subcommittee, has proposed an additional $20 billion to develop FCS* technologies, while canceling the program.

Basically, he’s looking at canceling the most ambitious aspects of the program, and the $20 billion would be used to redirect the program towards nearer term technology.

When I worked on the FCS‡, it was an article of faith that the systems, at least the manned systems, would never be fielded in large numbers, but that the underlying technology would be a part of an upgrade to legacy systems, and it looks like Murtha is of the same mind.

There is a lot to admire in the way of technology, the article mentions the use of robots to investigate IEDs and advanced communications systems, for example, and the initial release of this technology could benefit the troops now, as opposed to the full up system, which may not benefit the troops ever.

*Full disclosure, I worked on the Future Recovery and Maintenance Vehicle, FRMV, “wrecker” variant of the FCS-MGV† from 2003-2006 at United Defense (later BAE Systems after the Carlyle Group sold me to buy Dunkin Donuts.
†Future Combat Systems-Manned Ground Vehicle. These are the ones that are the tanks and APCs. As opposed to the various unnmanned vehicles, networking technologies, etc. that form the full FCS along with the MGVs.
‡Yes, I have worked everywhere. Maybe I can’t hold down a job, but more likely this has been my role as “technical hit man”, where you are parachuted in to take care of a specific need.

The Tanker Saga: Northrop Calls Boeing Incompetent

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Northrop is now saying that Boeing lost largely because they cannot be trusted to deliver on time or on budget. From their press release:

….

Past Performance

A contractor’s past performance on related projects is a critical element in the Air Force’s assessment of competing proposals. Because replacing America’s fleet of aerial refueling tankers is the number one acquisition priority for the Air Force, it paid special attention to Boeing’s assertions that it could complete the contract on time and on budget. While Boeing likes to claim that it has a better track record than Northrop Grumman in building tankers, the Air Force determined that Boeing’s past record actually meant it was riskier to do business with Boeing than Northrop Grumman.

According to an Air Force document assessing the two bids, in program management ” … There was a notable difference between the two offerors. Northrop Grumman received a rating of ‘Satisfactory Confidence,’ while Boeing received a rating of ‘Little Confidence.'”

A rating of little confidence means the Air Force concluded that “Based on the offeror’s performance record, substantial doubt exists the offeror will successfully perform the required effort.” The reasons for the Air Force’s poor rating of Boeing were redacted for business competition reasons.

The Air Force stated that Northrop Grumman received a superior rating because of its “Excellent and satisfactory (risk) ratings on six (other) contracts.” The Air Force document concluded “The higher confidence rating for Northrop Grumman … was a discriminator” because “This difference in the program management provides better overall confidence. Northrop Grumman (was) more advantageous.”

It is worth noting that while Northrop Grumman has built, flown and tested a prototype aircraft and conducted a successful fuel transfer through its boom, Boeing has not yet built, flown or tested its proposed new design KC-767 aircraft. In addition, Boeing has been late in delivering tankers to Italy and Japan. These aircraft are significantly different from the design proposed to the Air Force.

…

If this was said in a bar, fists, and possibly beer bottles would fly.

A-330 MRTT Tanker Grounded for Modifications

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Needless to say, the Boeing rent-a-crowd is probably all over this, but really, this grounding is a normal part of a test program. (Paid Subscription Required)

Basically, they are installing updated plumbing, and setting up a remote station for the boom operator in the cockpit.

Earlier tests have been about verifying the airworthiness of the boom, which it passed in flying colors, with testing of the boom in use being done on a smaller A310 testbed.

The MRTT is almost identical to the KC-45 selected by the USAF.

Senate Bill Drops C-17s, Funds F-22s (Sort Of)

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The Senate Armed Services Committee has passed a Defense Authorization bill which funds 20 additional F-22s, but does not fund additional C-17s. (more details at link)

Half way there. We don’t need either, though the F-22 funding also includes $497M for shutting down the F-22 line too.

The idea is to leave both options open to the next president.

Hopefully, the next president will have the guts to kill the white elephant that is the F-22.

Switzerland Fighter Competition

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Basically, the Swiss have been operating F-5E/Fs in 1976, and they are looking towards replacing them.

In the competition were Boeing (F/A-18E/F), Eurofighter (Typhoon), Dassault (Rafale), and my favorite SAAB (Gripen).

Boeing has now pulled out of the competition, even though they would appear to have a leg up, as the Swiss already operate the F/A-18C/D. The official word was that their withdrawal was based on “Thorough review of Switzerland’s requirements for partial replacement of its Tiger fighter aircraft,” which I tend to agree with.

The F/A-18 is about two sizes larger than the F-5, and would require modifications to the facilities to accommodate their size.*

My guess would be that SAAB is at an advantage in this competition:

  • Range is not an issue, Switzerland is a small country.
  • It is far less expensive than any of the alternatives, being around 1/3 that of the Rafale and Typhoon.
  • It’s short field characteristics are probably the best, being designed, according to Swedish doctrine, to operate from stretches of roads.
  • It’s designed for austere maintenance by conscripts.

One wonders if the Swiss would be interested in the base C/D model of the Gripen, or if they would want the upgraded variant.

Considering their needs, I would expect them to go with the lighter original, as I’ve said, they do not need the payload/range, which is already far in excess of the F-5s that are being replaced, though the AESA radar might be a part of an upgrade.

*It probably did not help when, earlier in the competition, Boeing claimed that it would kick ass in short field capabilities relative to the competition.
While the aircraft does take off in a remarkably short distance from an aircraft carrier, that involves the use of catapults and arresting gear.
With the lowest power to weight ratio and highest wing loading of the competitors, they may have had representatives of the Swiss government laughing in their face.

Update on Indian MMRCA Competition

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Proposals for the Indian Medium Multi-Role Combat Aircraft (MMRCA) competition were sent in recently. See my earlier post here)

A good rundown on the competitors is at the link, though I count the IAF’s familiarity with Russian equipment as a plus, not a minus.

The competitors are the MiG-35 (a Mig-29 derivative), Gripen, Rafale, Typhoon, F-16 and F-18E.

I think that the US fighters may be ruled out because of the effects of possible sanctions in the future, the US is much more aggressive in these actions than the French or British.

The Rafal and Typhoon are too pricey.

This leaves the MiG-35 and Gripen, with the former being cheaper to buy but more expensive to operate. The upgraded Gripen closes some of the gap in payload and range, but both are far superior to the MiG-21s that they would replace.

Then again, we know how good my predictions are.

Tanker Update

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It’s been a while, so we need to feed that tanker dispute Jones.

First, we have a press release from Northrop Grumman saying the obvious, that “Compared to the KC-767, the KC-45 can deliver more fuel at equal ranges (decreasing the number of aircraft required to meet mission requirements) or the same fuel load from greater distances (increasing potential Air Force basing options),” which is at this point in the “well duh” category, but a few lines down, they say, “Furthermore, the Air Force added that the KC-45’s greater refueling capability “Enables it to execute (the mission) with 22 fewer aircraft than Boeing’s … an efficiency of significant value to the government.”

22 Aircraft ain’t chicken feed.

By way of a very small cloud on the KC-45 Horizon, the Australian A330 MRTT is getting some new parts and modifications, some of which probably involve the boom.

The bottom line on the boom, however, is that while it was invented by Boeing, it was also designed from a clean sheet by McDonnell Douglas for the KC-10, and it’s been around for 50 years. It is not rocket science.*

*Full Disclosure, in 1999-2000 and 1996-1998, I worked as a mechanical engineer for what is now Lockheed Martin Missiles and Fire Control, and I have some claim to actually being a rocket scientist.

Whither Us Defense Contractors?

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Dov S. Zakheim and Ronald T. Kadish, senior executives at Booz Allen Hamilton, the government and defense consulting firm, have written a blistering editorial criticizing the defense consolidation of the 1990s, and the role of the government, in particular the Clinton administration, in encouraging this.

While I agree with their assessment of the facts, that there was an extraordinary level of consolidation in the 1990s, and that no savings have yet materialized, and that defense procurement is an over budget and behind schedule mess, I disagree with their basic thesis, that somehow deconsolidating the defense industry will help.

These moves highlight an unfortunate reality: The United States is approaching an “arsenal system” for developing and producing its weapons — that is, one in which the government manufactures its own weaponry. It’s an antiquated model with modest benefits, but the way things are going even those will probably be lost.

I have worked off and on in defense since 1992, and I have not seen any significant change.

With the US government spending more than the rest of the world on defense, it means that we are merely seeing the consequences of an effective monopsony (single buyer market, the reverse of a monopoly).

We already have a market without meaningful competition, and when you have for profit institutions without competition, you do not save money.

What’s more the self-dealing, how many retired generals work for defense contractors after, and other corruption and pork barrel aspects to not bode well for the future.

I’m not sure how to fix this, but the use of private defense contractors is not working, so perhaps an arsenal model will work.

I will note that the one part of the Soviet economy that produced reasonable quality products efficiently was their defense industry, which was precisely the arsenal model that they disparage.

Northrop Grumman Wins BAMS

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The Broad Area Maritime Surveillance (BAMS) has just been awarded to NG, beating Lockheed-Martin/General Atomics and Boeing/General Dynamics.

BAMS! Northrop Wins Billion-Dollar UAS Deal | Danger Room from Wired.com

Basically it’s a large drone and sensor suite optimized for maritime work. NG and LM/GA’s bids were fairly typical (see picture below), and Boeing/GD had presented an “optionally manned” modified Gulfstream biz jet.

As the norm these days, I expect a challenge

US May Prevent Shipments Eurofighter Typhoons to House of Saud

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It appears that the issue here is not technology transfer, but the corruption allegations swirling around the deal that have put the transfer at risk.

The Department of Justice has problems with the roughly $1 billion in “consultancy fees” to Prince Bandar, aka “Bandar Bush”. See here, here, here, here, and here for my earlier thoughts on this.

I don’t see anything happening to Prince Bandar until after January 2009, because of his remarkably close ties to the Bush clan, and truth be told, I don’t see anything beyond embarrassment happening to him until the violent revolution that seems inevitable in the lands of the House of Saud.

Tanker Update

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Here is some interesting scuttlebutt on the tanker challenge.

Two items, one is that the USAF has moved to have the GAO dismiss the challenge in its entirety, which is not unexpected, and the second is that USAF “Red Teamed” the bid process in response to the prior contract, the lease deal which imploded in corruption convictions and jail times for USAF and Boeing officials.

Well, the NorGrum official told me that for a month and a half, the Air Force convened a Red Team of the Army and Navy’s top procurement officers, staffers from Pentagon acquisition chief John Young’s office and Pentagon IG officials at Wright Patterson Air Force base. The team was tasked with poking holes in the contract process to make sure there could be no protest from either side on how the Air Force handled the competition.

I believe this report, because after the first tanker contract came down, and Boeing screwed it up by getting too greedy, which is what got the investigation going in the first place, I could see people from the top to the bottom of the chain of command having, “Don’t f&^% it up this time,” as an imperative