BAE Systems, original equipment manufacturer for the Bradley Fighting vehicle, is proposing ways to keep the 586 supplier-strong industrial base and Army modernization moving along instead of an Army plan to shutter vehicle production from 2014 to at least 2017, an official said.
“It’s about maintaining a strategic capability that is easily lost and is not easily reconstituted and the cost for that reconstitution is probably in excess of the cost to sustain the capability over the same period,” Mark Signorelli, vice president and general manager of BAE Vehicle Systems, told Defense Daily in an interview.
Detailed analysis of the cost to shut down production lines at the York, Pa., facility, then restart them and requalify the lines and personnel is some $750 million, the company said in a fact sheet.
Basically, the service would be spending money to shut down and then re-establish the capability, not improve it, he said.
Work begins to ramp down this year. By 2014, the tipping point is reached: there’s just not enough work to sustain the industrial base, Signorelli said. In 2017, comes the uptick and restarting for the industrial base. In other words, about the time the ramp-down is complete, it’s time to start training personnel to meet the 2017 startup date.
BAE has laid out a number of things that could bridge the potential three-year gap, Signorelli said.
First, if the continuing resolution passes with defense appropriations attached, it provides a $140 million plus-up for the Bradley industrial base. Also, there is $62 million for M88 Recovery Vehicle work to help sustain York in 2014.
BAE has asked for support for Bradley, for example, adding survivability improvements to a couple of brigade sets so rapidly deploying forces have a more capable vehicle.
The M88 will help York get through 2014. Also, the company has asked Congress and the Army to consider moving to a pure fleet–the M88 A2 standard.
In 2015, the M88 takes up the preponderance of the workload and BAE is working with the Army to develop some applications for Bradley, but funding for that would have to be found.
To maintain the industrial base capability BAE isn’t looking for billions, but a few millions, Signorelli said.
BAE’s problem is the same as that faced by General Dynamics [GD] and the Anniston and Red River Army Depots, Signorelli said. The wartime military investment in recapitalizing the heavy combat vehicle fleet leaves it in pretty good shape now as it returns from Iraq and Afghanistan. But, with a smaller budget, there is less money for discretionary funding and the service is not resourcing enough work to sustain the industrial base.
“What it really translates to is a real likelihood that some significant portion of the supply base, and part of the manufacturing base as well, will either be put out of business or choose to exit the defense sector and likely not return,” Signorelli said.
Those same vendors are needed to sustain the Bradley out to 2020-2025, under current service plans, he said.
A three-year shutdown means specific skills are likely lost: welding large ballistic structures, armor welding and laser production technology, to name three, and none are common in the commercial industrial base, nor is something like electro-magnetic interference shielding. “Those are the things that are truly at risk,” he said
“By 2017, our belief is that many of those skills will not be available, and it would cost the Army significantly more to re-establish capabilities we have today than it would to provide minimum sustaining levels.”
Even if those same vendors are still available and willing to come back to the defense market, they still must go through a qualification process because of the production break.
As an example, Signorelli said, even a large supplier like L-3 [LLL] which builds Bradley transmissions, potentially might have to shut down that line unless something supports it through the production break. That would mean job losses, and since the Army would need the transmissions, there are costs to restarting the line, requalifying the processes and personnel and again rise up the learning curve.
Employees, labor unions, support vendors and associations such as Aerospace Industries Association and the National Defense Industrial Association have been engaged and working to ensure interested parties understand the issues.
BAE’s tracked combat vehicle industrial base is largely tied to its York, Pa., site. York maintains the readiness of four of the five vehicles used by Armored Brigade Combat Teams: Bradley, the M88, the M109 Family of Vehicles, the self-propelled howitzer Paladin Integrated Management program, and the M113 personnel carrier.