Can’t Turn on a Dime. If the Marine Corps shifts to lighter, more mobile forces and assets that would require lighter amphibious warships that would be acquired by the Navy, then industry needs to be part of the conversation because “you’re really talking about what does shipbuilding, what does the Navy look like 10 to 15 years from now,” Mike Petters, president and CEO of Huntington Ingalls Industries, said last week in response to an analyst’s question during the company’s first quarter earnings call. The operational concept the Marines are considering doesn’t change “their near-term requirement for heavy lift,” he said. Petters added that the Navy that the country will have in five years is being “built today and it’s at sea today. So, time frames have to be kind of thought their way through,” he said, and industry and the Navy need to “work together to take advantage of all the assets that we have to create a capability that would support going forward.”

…Competitive Landscape. If the Navy were to shift to lighter ships in support of the Marine Corps, that would open up the industry to more competition, Petters said in a reply to the questions from Pete Skibitski, a defense analyst with Alembic Global Advisors. Petters said, “something that we’re thinking really hard about is that there is a bit of a floor for us in terms of as you get smaller in ship size, the market becomes a lot more competitive. And so, we’ve got to think our way through that, just as a business, how do we improve our competitive position as, if this is a direction that our customer is going to want to go.”

…Valuations. During the earnings call, Petters was asked by Bank of America aerospace and defense analyst Ron Epstein if the COVID-19 pandemic presents acquisition opportunities for HII’s Technical Solutions segment. Petters said that at the moment, “valuations are just, I’d almost say, mythical” because they’re difficult to gauge. HII is still interested in acquisitions but a company whose stock maybe has been “wiped out” due to market volatility may still think it’s worth “a lot more than their share price is,” he said. HII is still looking and “we’re kind of leaning forward to try to find ways to make something out of it,” he said.

…HII Subs. Petters said the company is optimistic the Navy will end up buying a second Virginia-class attack submarine in FY 2021. The Department’s budget request sought only one submarine despite previous plans to buy two per year over the five-year multi-year procurement contract. “There were some late moving items in the budget frankly from last year to this year that I guess my assessment is that the Congress was surprised about, and so, when that happens, it takes a lot more work from the administration and from all the stakeholders to work their way through it,” Petters said on the May 7 in a quarterly earnings call. “My sense of this, though, is that the outlook for that second Virginia is pretty bright. I think the Congress pretty much made its intentions pretty clear and so I don’t know how the pieces move around but I’d say I’m pretty optimistic about it.”

JASSM Production. The Air Force on Wednesday awarded Lockheed Martin a $49.8 million cost-plus-fixed fee modification to increase Joint Air-to-Surface Standoff Missile (JASSM) production. Work will be performed in Orlando, Florida, and is expected to be complete by March 31, 2023.

CA-25. Retired Navy F/A-18 fighter pilot and Raytheon former vice president of business development Mike Garcia (R) appears poised to win the May 12 special election to represent the district most recently held by Rep. Katie Hill (D). Hill resigned in late 2019 amid an ethics investigation; Tuesday’s special election will pit Garcia against Democrat Christy Smith. Multiple reports currently show Garcia with an edge in polls. The district includes Edward AFB.

Rocket Lab Back Online. Rocket Lab said Thursday it has resumed launch operations after being grounded for over a month while following local COVID-19 health guidelines in the United States and in New Zealand. Its Electron rocket is back on the pad in Mahia, New Zealand, for wet dress ahead of its 12th launch, with launch window schedule soon to be announced. The “Don’t Stop Me Now” mission will include payloads for NASA, the National Reconnaissance Office (NRO) and the University of New South Wales Canberra Space.

ACE Program. Dynetics said Wednesday it has received a $12.3 million contract for part of DARPA’s Air Combat Evolution (ACE) program, which will use automated aerial dogfighting as an initial challenge scenario to implement AI into high-intensity air conflicts. Dynetics is leading Phase 1 of ACE’s Technical Area 3 portion, and will use technology advances in automated dogfighting to lay the groundwork for future live experiments with manned and unmanned systems over the 18-month program.  “In a sense, what we’re trying to do is fundamentally invert the current battle management network, to where a single human is able to control … multiple agents and unmanned systems across the distributed network, which will allow us as a country to learn how to increase resiliency and lethality in our mosaic warfare type strategies that are being developed now throughout the military,” said Tim Keeter, ACE program manager at Dynetics in a Thursday media call.

GMD Boosters. The Missile Defense Agency awarded Boeing a $128 million modification on May 7 to work on the Ground-Based Midcourse Defense (GMD) system’s C2 boost vehicles. It specifically definitizes continued support of the GMD by manufacturing C2 boost vehicles, booster spare parts and associated avionics to maintain fleet and flight test programs. This increases the total GMD contract from $11.208 billion to $11.337 billion. The period of performance lasts from January 2018 to September 2022.

RCOH. The Navy awarded Huntington Ingalls Industries a $187 million modification to prepare and make ready for the refueling and complex overhaul (RCOH) of the USS John C. Stennis (CVN-74). This mod will extend the period of performance of the existing RCOH contract for continued advance planning efforts like material forecasting, long lead time material procurement, scheduling, resource forecasting and planning, data acquisition, pre-overhaul tests and inspections. The work is expected to be finished by January 2021. “This modification constitutes the award of an existing option for an additional six months of effort,” the contract announcement said. As the only contractor that built the Nimitz-class carriers, DoD noted HII is the only private yard capable of accomplishing the RCOH work. Work will be split between Newport News (65 percent) and Norfolk (35 percent), Va.

ATFLIR. The Navy awarded Raytheon a $325 million contract to repair the Advanced Targeting Forward Looking Infrared System (ATFLIR) used in support of the F/A-18 aircraft. The ATFLIR operates in a pod and integrates advanced Electro-Optical/Infra-Red sensors with a laser to locate and designate targets at ranges over 40 nautical miles and altitudes over 50,000 feet. Work will be split between facilities in McKinney, Texas (59 percent), and Jacksonville, Fla. (41 percent), and the work is expected to be finished by May 2025. This is a five-year base contract with no option periods. Raytheon was the only company solicitated for the sole-source requirement as the original manufacturer.

Purpose-Built. Air Force Gen Terrence O’Shaughnessy, Commander, United States Northern Command and NORAD, said homeland missile defense should use more purpose-built systems in the future rather than relying on modifying existing systems. Speaking at a Mitchell Institute video event on May 4, O’Shaughnessy said the military has to take new technology available like directed energy and new types of radars and “we ought to take the technology from all those things, but we ought to apply it in a purpose-built way that will allow you to do it at an affordable rate, while still using some of the things that we are traditionally using.” He said the traditional view is how to use what’s already being used like F-35s and Patriot systems and apply that to homeland defense purposes. “I think we have to get out of that mindset and really start thinking about what the purpose-built capability capacity is because I don’t need a Patriot.”

…Cost Curve. O’Shaughnessy also said especially with homeland defense the military needs to “flip that cost curve” with missile defense systems. Doing that requires “directed energy, it’s new ways to actually defeat things, not just directed energy but it’s just things like directed energy.” He noted directed energy is the type of system that allows a high rate of power, a deep magazine, and being able to take on multiple threats.

FMS Fees. A new GAO report is calling on the Pentagon to improve its oversight processes for managing transportation fees associated with foreign military sales. “DoD’s financial oversight is supposed to ensure that money goes in and out of the transportation accounts appropriately. However, DoD’s oversight processes do not ensure that: annual reviews are routinely overseen, which increases the risk that fees collected may be inaccurate [and] shipping expenses paid are accurate and allowable,” GAO officials wrote in their report. GAO is recommending the initiatives are implemented to conduct annual reviews to ensure fees collected in FMS transportation accounts are accurate and suggest establishing a new process to monitor the timeliness of reporting collection of transportation fees. 

N95 Masks. The Pentagon, in coordination with the Department of Health and Human Services, has awarded $126 million to 3M to increase production of its N95 medical masks. The new deal is aimed at boosting production to 26 million masks per month, starting in October. “3M will design, procure, and implement necessary production facilities and equipment to expedite the existing delivery schedule and increase N95 respirator production by at least 312 million annually within the next 12 months,” Air Force Lt. Col. Mike Andrews, a Pentagon spokesman, said in a statement.

Army Trailers. Leonardo DRS said May 6 it has received a new deal from the Army to build tactical transport trailers for armored vehicles. The Army placed an initial $12.2 million order for 60 of the Heavy Duty Tank Trailers. The advanced HDTT systems will be used to haul main battle tanks and other heavy vehicles, and are designed to carry over 70 tons of payload. “We are proud to have been chosen by the U.S. Army Contracting Command for this important program that will help extend mission capability,” John Fitzpatrick, Leonardo DRS Land Systems’ vice president of business development, said in a statement. 

Cyber/EW Industry Day. Army Project Manager Electronic Warfare & Cyber will host an online “Strategic Planning Industry Day” on May 28 to provide updates on its procurement portfolio for FY ‘21 and protected contract opportunities. PM EW&C will detail technology for cyber electromagnetic activities and tools for integrated EW, signals intelligence and cyber capabilities. The program office is also interested in miniaturized high gain broadband directional antennas, radio frequency interference mitigation tools and capabilities for deep sensing in contested environments.

Hungary AMRAAM FMS. The State Department on Friday approved a $230 million deal with Hungary for 60 AMRAAM-Extended Range missiles. The deal also includes two spare AMRAAM-ER guidance sections, four training missiles and missile containers. “The sale is in support of Hungary’s acquisition of the National Advanced Surface to Air Missile System (NASAMS) air defense system and would provide a full range of protection from imminent hostile cruise missiles, unmanned aerial vehicles, rotary wing and fixed wing threats,” Defense Security Cooperation Agency officials wrote in a statement.

New IC Cyber Position. Acting Director of National Intelligence Richard Grenell last Friday announced several organizational changes to his office, including the consolidation of four separate organizations focused on cyber into the Intelligence Community Cyber Executive. The statement says the IC Cyber Executive position is the “focal point for the cyber mission” and will strengthen the community’s cyber posture. Grenell also established an adviser position for Military Affairs to “unify” his office’s efforts for the Defense Department.

USS Boise. The USS Boise (SSN-764) was moved from Naval Station Norfolk to Huntington Ingalls Industries’ Newport News Shipbuilding facility on May 8 to start pre-maintenance “smart scan” activities as the company prepares for the vessel’s multi-year engineered overhaul. The overhaul is a mid-life submarine event to perform necessary repairs, maintenance and modernization. The Boise has been the poster child for the Navy’s delayed maintenance issues over the past decade. It was first scheduled to start maintenance work at the Norfolk yard in 2013 but that was delayed several times. In 2018 it was scheduled to undergo the work at HII but that was then delayed to this year due to lack of funds and the USS Helena’s (SSN-725) maintenance availability going longer than planned. Boise has been delayed so long it lost its dive certification in 2017. Last December, Navy officials said the Boise would finally go into drydock around April.