Page 32 – Defense Daily

CG-71 Returns To San Diego After Vigor Modernization

The Ticonderoga-class guided-missile cruiser USS Cape St. George

(CG-71) recently arrived at its newest homeport at Naval Base San Diego following the completion of modernization work that will help keep it operational for longer than previously planned.

CG-71 started modification in Jun 2021 at Vigor Shipyard in Seattle, Wash., which includes “extensive upgrades” to its hull, mechanical systems, engineering and combat systems. And remaining work is expected to be concluded this year before it rejoins maritime operations.

Ticonderoga-class guided missile cruiser USS Cape St. George (CG 71) arrives at the mouth of San Diego Bay, April 22, 2025. Cape St. George, previously based at Everett, Wash., completed her homeport change to Naval Base San Diego. (U.S. Navy photo by Mass Communication Specialist 1st Class Kelby Sanders) — Ticonderoga-class guided missile cruiser USS *Cape St. George* (CG 71) arrives at the mouth of San Diego Bay, April 22, 2025. *Cape St. George*, previously based at Everett, Wash., completed her homeport change to Naval Base San Diego. (U.S. Navy photo by Mass Communication Specialist 1st Class Kelby Sanders)

The Navy said these upgrades will keep the cruiser as one of the most technologically advanced ships in the Navy.

The Navy awarded Vigor a $225 million contract to execute the modernization work on the USS Chosin (CG-65) and CG-71 in 2019 (Defense Daily, Oct. 2, 2019).

This is the last step in a nearly-botched process to extend the lives of several cruisers via modernization and upgrades.

Last year, the Navy announced it would extend the operations of 12 Flight 1 Arleigh Burke-class destroyers and three cruisers past their planned service lives, including CG-71. This seeks to boost fleet ship numbers as shipbuilding has been slower than desired. The normal cruiser service life was originally planned to be 35 years (Defense Daily, Nov. 4, 2024).

The three cruiser extensions are meant to add 10 years of cumulative service life over FY 2026 to 2029. The other extended cruisers are the USS Gettysburg (CG-64) and Chosin (CG-65).

While the upgrade program originally aimed to add five years of service life to each ship, they will now only last until FY 2030.

When the Navy announced the cruiser extensions, the service noted the cruisers have already, or in CG-71’s case, in the midst of extensive hull mechanical and engineering plus combat systems upgrades in an extended modernization program.

Congress previously mandated the Navy modernize and extend the life of seven cruisers, but Navy program timing and cost troubles mean only those three cruisers could have their lives extended. This kind of modernization work started on CG-64 back in 2014 and is only wrapping up 11 years later.

The Navy previously planned to spend about $2.4 billion to modernize the five cruisers, but a December Government Accountability Office report found that the work had about $881 million in cost growth, a 36 percent increase. The Navy also ended up wasting $1.84 billion total on delays and two ships not having their lives extended (Defense Daily, Dec. 17, 2024)

The Navy also planned for the modernization to take about four years each, but it ended up taking three to five more years than planned.

The Cape St. George was originally commissioned in 1993, with a name commemorating a 1943 World War II battle flight in the South Pacific off the island of New Ireland in the Bismark Archipelago.

Army Looks To Boost GMLRS Production To 19,000 Rockets A Year Starting In FY ‘28

The Army has detailed plans to further ramp up Guided Multiple Launch Rocket System (GMLRS) production, with an aim to build just over 19,000 rockets annually between fiscal year 2028 and 2032.

A new Army notice published Thursday asks for white papers to detail “the most efficient and cost-effective method” to achieve the production boost for the rockets, which are built by

Lockheed Martin [LMT].

GMLRS Alternative Warhead Firing
Photo: Lockheed Martin

“Industry is also encouraged to describe the benefits or risks associated with the inclusion of production options and recommendations on contracting approaches that provide best value to the [Army] while minimizing risk, especially cost risk, to the selected contractor,” the Army writes.

Lockheed Martin has been steadily increasing the GMLRS production rate and has said it plans to achieve capacity in 2025 to build 14,000 rockets per year.

“We continue to work closely with the Army and supply chain partners, who are moving with unprecedented speed, to ramp production capacity and deliver this highly reliable, combat-proven rocket,” Dave Griser, Lockheed Martin’s vice president of precision fires rockets, has said previously.

The Army this past October awarded Lockheed Martin a multi-year GMLRS contract initially worth up to $4.1 billion, with the deal covering the first production order for the new Extended Range variant (Defense Daily, Oct. 16, 2024).

An Army spokesperson confirmed to Defense Daily at the time that the award involved converting an existing contract into the new undefinitized, multi-year deal.

Paula Hartley, Lockheed Martin’s vice president of tactical missiles, told reporters in October the new multi-year deal covers fiscal years 2025 to 2027, and includes a first production lot quantity for 240 ER-GMLRS with deliveries to begin in 2027.

The Army’s plan to build 19,002 GMLRS each year from FY ‘28 to ‘32 would cover the unitary and alternative warhead versions along with the ER-GMLRS variant.

A full-rate production decision for ER-GMLRS, which doubles the range from 70 to 150 kilometers, is expected in early FY ‘27 (Defense Daily, Feb. 5).

Hartley has said Lockheed Martin is aiming to ramp up the ER-GMLRS production line to eventually handle a capacity “in the low thousands…think two to four thousand.”

Oshkosh Defense To Deliver JLTV Variant To Netherlands

The Netherlands has selected Oshkosh Defense [OSK] to deliver a variant of its Joint Light Tactical Vehicle (JLTV) for the Dutch Marines’ effort to field a new all-terrain mobility platform, the company said Thursday.

Oshkosh Defense said it will produce 150 Dutch Expeditionary Patrol Vehicles (DXPV) for the Future Littoral All Terrain Mobility–Patrol Vehicle (FLATM-PV) program.

Dutch Expeditionary Patrol Vehicle variant of the JLTV. Photo: Oshkosh Defense

“Since the FLATM-PV program has no armor requirements and requires a lighter vehicle than the JLTV, we replaced the transparent armor windscreens with automotive windscreens, changed armored sidewalls to lightweight sidewalls, replaced the doors with lightweight doors with automotive glass and replaced a few other minor components with lighter weight components. The DXPV still has the same impressive off-road mobility provided by the Oshkosh TAK-4i intelligent independent suspension system,” an Oshkosh Defense spokesperson told Defense Daily.

A final contract for the new Direct Commercial Sale will be signed in June, according to the company spokesperson, with all vehicles to be delivered by the third quarter of fiscal year 2028.

“Our DXPV is highly common with the approximately 22,000 JLTVs delivered to the U.S. DoD and more than 1,600 JLTVs produced for other NATO and allied countries that are being fielded now and in the future,” Pat Williams, Oshkosh Defense’s chief programs officer, said in a statement. “This high level of commonality not only significantly reduces the logistics footprint required to support and sustain the DXPV, but also ensures exceptional system performance, maximizes operational readiness, and enhances interoperability.”

While Oshkosh Defense lost the U.S. Army’s JLTV re-compete contract to AM General, the company noted it “continues to be the only original equipment manufacturer able to supply the JLTV directly to allied countries.”

The Netherlands is now the latest international partner to operate a version of the platform, joining Lithuania, Slovenia, Montenegro, North Macedonia, Mongolia, Latvia, Slovakia, Brazil, Romania, and Israel, according to Oshkosh Defense.

AM General has said its on track to support the Army’s plan to begin fielding the new A2 version of the JLTV in mid-2026 (Defense Daily, Oct. 17 2024).

Lockheed Martin to Receive Sustainment Contract for FPS-117 Radars

The U.S. Air Force plans to award Lockheed Martin‘s [LMT] site near Syracuse a five-year contract for sustainment of the AN/FPS-117 Atmospheric Early Warning System (AEWS) radar, originally developed by General Electric [GE].

“A sources sought notice posted in September 2024 was issued to determine potential contractors capable of addressing the combined software and hardware issues,” the Air Force Life Cycle Management Center’s AEWS program said in a Thursday business notice. “While responses were received from several vendors, none of them were capable of sustaining the systems that are proprietary technologies to [Lockheed Martin]. Where possible, the government has identified certain assemblies/systems of the FPS-117 Radar that are not considered proprietary technology to [Lockheed Martin]. Those systems will be procured through another contract vehicle which will be competed.”

“Given that the government does not own the rights to the assemblies/systems identified, and that [Lockheed Martin] has proprietary rights over those systems, a sole source award to [Lockheed Martin] is warranted,” the notice said.

The Air Force has said it may issue a five-year Advanced Range and Radar Array Key Instrument for Sustainment (ARRAKIS) solicitation this year to improve the performance of the FPS-117 (Defense Daily, Nov. 26, 2024).

Last November, Air Force Materiel Command (AFMC) held an ARRAKIS industry day at the FPS-117 engineering facility at Hill AFB, Utah. The Air Force is looking to sustain the FPS-117 until at least 2035.

The 250-mile range, three dimensional phased array antenna radar, able to detect objects at 100,000 feet, has 27 sites and is part of the U.S./Canadian AEWS to warn of intrusions into North American airspace by aircraft, missiles, and now balloons over the North Pole. Canada’s portion is the North Warning System (NWS).

NWS, originally designed to counter Soviet bombers, covers nearly 3,000 miles across North America from the Aleutian Islands in southwestern Alaska to Baffin Island in northeastern Canada, and U.S. Northern Command has spoken of the need to move to longer-range, over-the-horizon radar to counter not only aircraft, but cruise missiles and small drones.

For ARRAKIS, AFMC is looking for contractors with hardware/software radar design tech refresh experience. Contractors attending last November’s industry day were SRC, Inc.; Select Engineering Services; Decryptor, TSS Solutions; and Kihomac.

Lockheed Martin is to continue its sustainment of the FPS-117’s proprietary mission software, the Monopulse Secondary Surveillance Radar, the Signal Processor Data Processor, and the Digital Array Row Transceivers.

“Proprietary designs driven by contractor business strategies hinder sustainment and significantly impact weapon system performance,” according to an Air Force briefing slide from last November’s industry day. “The complexity of logistics has compromised the level of support, increasing the difficulty of performing technical and emergency services when needed.”

The maximum annual number of FPS-117 “emergencies”–temporary radar malfunctions–is “four to five,” the AEWS program said last year. “Two last year, three or four the year before. Temperature can get to -70F or colder at the sites. That impacts the hardware.”

Emergency service “is essential,” the AEWS PMO said, as “techs may not have the tools to figure out what exactly is the problem,” if the radar stops rotating.

“That’s when contractor would be called upon,” the AEWS PMO said. “Down time can only be less than a designated number of hours per year. When radars go down, the four star of NORAD is immediately notified.”

A fiscal 2024 North American Aerospace Defense Command/U.S. Northern Command (NORAD/NORTHCOM) unfunded priorities list to Congress said that 1980s radars and earlier will begin reaching the end of their service lives this year and that these radars “will begin to fail at increasing rates.”

Such radars include the 1970s-era Westinghouse, now Northrop Grumman [NOC], TPS-75 and the FPS-117.

The Air Force said that it has awarded Lockheed Martin $472 million so far under the Three-Dimensional Expeditionary Long-Range Radar program for 19 TPY-4 radars to replace the TPS-75s (Defense Daily, Apr. 22). The contract includes $100 million added by Congress for four TPY-4s for NORAD/NORTHCOM.

SAIC Nabs Potential $55 Million SDA Award To Be Tranche 3 Integrator

Taking lessons learned from the development and acquisition of the initial Proliferate Space Warfighter Architecture (PWSA), the Space Development Agency (SDA) this week awarded Science Applications International Corp. [SAIC] a potential $54.9 million contact to be the integrator for the Tranche 3 portion of the architecture.

SAIC’s role is a new one under the program. General Dynamics’ [GD] Mission Systems division previously won a contract to establish the Ground, Management, and Integration framework for Tranches 1 and 2 of PWSA.

Under the five-year cost-plus award fee Tranche 3 Program Integration (TP3I) contract, SAIC will provide various systems engineering and integration tasks such as develop verification products, coordinating test events for space vehicles, coordinating product reviews, configuration management, and create, manage, and maintain a T3 program delivery schedule across all satellite vendors within the tranche.

SAIC’s support will enable “the delivery of Tranche 3 Space Vehicle Transport, Tracking, and Custody Layers and their integration within the PWSA Ground Segment,” SDA said in an April 22 award notice.

SDA recently released a request for proposals for the Tranche 3 satellites, which consist of communications spacecraft—called the Transport Layer—and missile detection and tracking birds—called the Tracking Layer. Awards are expected later this year.

A small fleet of Tracking and Transport Layer satellites are already on orbit under the Tranche 0 phase of PWSA. The launch of Tranche 1 spacecraft was originally planned for last fall but various delays, including supply chain challenges, have moved the start of those launches until late this summer.

“With the spiral development model, SDA continuously pushes lessons learned into subsequent tranches,” an SDA spokesperson told Defense Daily. “SDA decided to contract with a Tranche 3 integrator based on lessons learned from acquiring and delivery of Tranche 1 and 2.”

SDA said five offers were received for the T3PI effort. The government obligated an initial $6 million in fiscal year 2025 research and development funds at the time of the award.

Earnings Up, Sales Dip At L3Harris In First Quarter

L3Harris Technologies [LHX] on Thursday posted strong first quarter earnings on lower corporate, divestiture, and business transformation costs, and higher operating earnings despite a slight drop in sales.

Net income jumped 35 percent to $386 million, $2.04 earnings per share (EPS), from $285 million ($1.48 EPS) a year ago.

Excluding merger and divestiture expenses, a divestiture-related loss, and costs associated with the company’s LHX NeXt transformation, adjusted earnings of $2.41 EPS were up 7 percent and topped consensus estimates by a dime. Adjusted segment operating margin rose 50 basis points to 15.6 percent.

Costs associated with LHX NeXt are declining and the initiative is wrapping up the cost optimization phase and will transition to enterprise transformation, entailing artificial intelligence-enabled and digital transformations solutions, and further supply chain optimization to “become leaner and more agile,” Ken Bedingfield, chief financial officer of L3Harris, said on the company’s earnings call.

Sales declined 2 percent to $5,1 billion versus $5.2 billion a year ago, due to the divestitures last year of an antenna business and an ordnance business, and one less work week in the quarter. Excluding the portfolio adjustments, organic revenue was flat as gains in the Communications Systems and Aerojet Rocketdyne segments were offset by declines at Integrated Mission Systems, and Space and Airborne Systems (SAS).

Continued challenges on classified fixed-price development programs within the Space Systems business of SAS weighed on sales and earnings. Bedingfield described the losses on the contracts as “kind of tens of millions of dollars of negative adjustments across a couple of programs.” He added that the programs will be in the clear later this year or in early 2026, noting they are important for “our country and the warfighter, and we see it as a strong growth area in the future.”

Orders were light at $4.3 billion, which the company shrugged off as being normal during a presidential transition period. Backlog declined 3 percent to $33.2 billion from the end of 2024.

L3Harris updated its outlook for 2025 to account for the recent divestiture of its Commercial Aviation Solutions business, which represents about a $525 million hit to sales and 55 cents EPS headwind to adjusted earnings this year. Improved performance and capital deployment options will partially offset the earnings hit by about 25 cents.

Sales are projected to be between $21.4 billion and $21.7 billion, $400 million lower than prior guidance. Adjusted earnings are forecast between $10.30 and $10.50 EPS versus between $10.55 and $10.85 previously. Free cash flow guidance remains at $2.4 billion to $2.5 billion. Free cash was negative $72 million in the quarter.

The company does not expect “meaningful” impacts from tariffs, Bedingfield said.

The company is confident in its previous “framework” for 2026 sales of $23 billion. Chris Kubasik, chairman and CEO of L3Harris, highlighted the Trump administration’s potential $1 trillion defense budget request for fiscal year 2026, a $1.1 billion award in April from the Dutch Defense Ministry for network modernization and software-defined radios, a classified award also in April worth more than $350 million, and another $200 million international award, as future growth drivers.

Kubasik said that international demand and interest in the company’s products remains strong despite concerns from allies and partners about the Trump administration’s commitments to alliances and security pacts.

Bedingfield also highlighted that the company’s work on the Technology Refresh 3 for the F-35 fighter is transitioning from development to a gradual ramp up in production, which will benefit sales in 2026. He said the space business will also return to growth next year with additional opportunities being the Space Development Agency’s (SDA) expected award later this year of the third tranche of missile tracking satellites and the administration’s Golden Dome for America homeland missile defense effort.

L3Harris’s missile tracking satellites are part of earlier tranches of the SDA Proliferated Warfighter Space Architecture, including its Hypersonic and Ballistic Tracking Space Sensor (HBTSS), which tracks advanced missile threats and provides fire control data to missile interceptors. President Trump’s directive in January establishing Golden Dome calls for accelerating HBTSS and L3Harris has said it is ready for production (Defense Daily

, April 9).

If L3Harris can get a production “order here quickly, we can have the U.S. covered while the president is still in office,” Kubasik said of HBTSS on the call.

Bedingfield also highlighted the Aerojet Rocketdyne segment, which he heads, as being well positioned for Golden Dome opportunities given its role supplying solid rocket motors and other propulsion-related systems for missile interceptors, target vehicles for the Missile Development Agency that it is looking to accelerate, and in-space propulsion.

USAF Air Superiority Concept ‘Evolving,’ As FY 2026 Budget to Show Whether Service Had to Make Trade-Offs to Afford F-47

The U.S. Air Force is examining ways to provide air superiority beyond the service’s traditional go-to of advanced manned fighters and air-to-air missiles at the same time that Air Force leaders say that omnipresent air dominance may not be required and that Boeing‘s [BA] future F-47 will allow the joint force “freedom of maneuver” against technologically advanced countries, such as China.

While the Air Force will continue to provide air superiority for the joint force, “there might be places where air superiority doesn’t turn into air supremacy,” Air Force Maj. Gen. Joseph “Solo” Kunkel, the service’s director for force design, integration, and wargaming, told a Mitchell Institute for Aerospace Studies’ virtual forum on Thursday.

“There’s probably places where there’s mutual air denial, where no one has air superiority, but we’re denying the air domain to the adversary,” he said. “I think, in some of these cases, that may be perfectly acceptable where we don’t have dominating presence all the time, where we’re not trying to take over a particular plot of air, but we’re denying its use to the adversary. Is that air superiority? I don’t know. I tend to think it is, but it may not be the traditional definition that we’ve had.”

Yet, mutual air denial has characterized Ukraine, which has become a war of attrition.

A week before leaving office at the end of the Biden administration, then Air Force Secretary Frank Kendall said that a manned Next Generation Air Dominance (NGAD) fighter would require more than $20 billion extra in research and development, as he laid out options for the incoming Trump administration, including long-range strike and de-scoping the NGAD program to comprise just unmanned Collaborative Combat Aircraft (CCAs) controlled by manned fighters, such as a successor to the Lockheed Martin [LMT] F-35 (Defense Daily, Jan. 13).

Manned NGAD has had a more than $200 million estimated unit cost, and an Air Force NGAD review panel, led by Timothy Grayson, a special assistant to Kendall, examined the way ahead and provided input to Kendall before the Air Force announced the manned NGAD pause in December.

A month ago, President Trump, in an Oval Office ceremony with Defense Secretary Pete Hegseth, Air Force Chief of Staff Gen. David Allvin, and Lt. Gen. Dale White, military deputy to the Air Force Acquisition and Technology Office, announced that Boeing had beaten Lockheed Martin in the NGAD competition to win the engineering and manufacturing (EMD) development contract for the F-47 (Defense Daily, March 21).

F-47 will assure “air superiority for generations to come,” Kunkel said. “The capabilities that it brings to the fight are game changing for us. We paused [NGAD]. I was part of the group that did the analysis and said, ‘Hey. Is there a different way to do this? Can we do this with the current capabilities?’ And we found…and I guess we probably didn’t need to do the analysis because we found out that we were right, that air superiority does matter, that it changes the entire complexion of the fight and that the F-47, the NGAD before we called it the F-47, absolutely does matter and changes the character of the fight, not just for the Air Force, but for the joint force.”

The F-47 “allows the joint force to get places it otherwise couldn’t,” Kunkel said. “It allows us to move closer to the adversary and to counter the adversary in ways that we can’t [now].”

The Air Force is examining CCA employment by a number of aircraft, including the F-47, he said–an employment that is to complicate an adversary’s targeting decisions and an employment that may feature air-to-air and other missions.

Next month, DoD is to release its fiscal 2026 budget request, which will clear up any trade-offs the Air Force had to make to afford F-47 EMD or whether the service received a significantly higher total obligational authority than in years past and thus did not have to assume higher risk in certain areas, such as flying hours, through reducing what it has viewed as critical spending.

Lockheed Martin Acquiring Amentum’s Rapid Solutions Business For $360 Million

Lockheed Martin [LMT] and Amentum [AMTM] on Wednesday said they have reached a deal for Amentum to sell its engineering and technology-focused Rapid Solutions business to Lockheed for $360 million in cash.

Rapid Solutions will become part of Lockheed Martin’s Space segment when the transaction closes, which is expected in the second half of 2025. Rapid Solutions accounted for about 1 percent of Amentum’s sales in 2024, which were $8.4 billion. The business has about 230 employees.

Rapid Solutions manufactures intelligence, surveillance, and reconnaissance systems, advanced communications, and tactical systems.

“Together, Rapid Solutions’ electronically steered array and Lockheed Martin’s demonstrated production capability and discipline as a prime integrator will provide the industry with a strong cost and value proposition to foster competition and help us support national security systems,” Tahllee Baynard, vice president of the Ignite division within Lockheed Martin Space, said in a statement.

Amentum said the divesture is part of its strategy to focus on advanced engineering and technology-focused solutions, and will help with debt reduction. The company expects the deal to provide $325 million in after-tax proceeds.

Boeing’s Losses Narrow In First Quarter Amid Strong Sales; No ‘Undue Risk’ In F-47 Contract

Boeing [BA] on Wednesday reported significantly lower losses in its first quarter as losses narrowed in its Commercial Airplanes segment and the defense and services segments notched modest gains, while sales were strong on an increase in commercial aircraft deliveries.

Boeing’s earnings followed closely the company’s win last month over Lockheed Martin [LMT] to develop and produce the Air Force’s F-47 sixth generation air superiority fighter (

Defense Daily, March 21). While the program is largely classified, the Air Force has said the engineering and manufacturing development contract is cost-plus incentive-fee and includes production of a small number of test aircraft.

Kelly Ortberg, Boeing’s president and CEO, on an earnings call assured investors the contract fits within the company’s strategy to avoid risk associated with fixed-price development contracts on a number of defense programs that have caused it billions of dollars in losses in recent years.

“Clearly, we haven’t come off our strategy of ensuring we’re entering into the appropriate contract type for the appropriate type of work,” Ortberg said. “So, I wouldn’t worry that we’ve signed up to undue risk like we’ve done in some of our past fixed-price programs.”

The value of the EMD contract has not been disclosed and Boeing said it was not included in “backlog at the end of the quarter pending completion of the source selection and evaluation review process.” Lockheed Martin on Tuesday said it did not protest the award (Defense Daily, April 22).

The F-47 win will “secure our fighter franchise for decades to come,” Ortberg said. The company currently supplies the F-15EX fighter to the Air Force, and the F/A-18 Super Hornet to the Navy. Super Hornet production is slated to end in 2027.

During the second quarter, Boeing will “begin to baseline the performance of our F-47 plan,” Ortberg said.

Results in Boeing’s defense business were mixed in the quarter. Operating income increased 3 percent to $755 million while sales fell 9 percent to $6.3 billion related to commercial derivative aircraft for defense customers. Operating margin rose 30 basis points to nearly 3 percent.

No charges were taken on fixed-price development programs, which showed “improved performance” during the quarter, Ortberg said.

Ortberg also provided updates on the work for the Navy’s MQ-25 unmanned aerial refueling tanker, noting the first engineering development aircraft has been transported from the St. Louis-area plant to a new, nearby facility in Illinois to begin final assembly for ground and flight testing later this year.

Progress has also been made on the Air Force’s T-7A jet trainer, with the company achieving the first two incentive milestones under a memorandum of agreement it signed with the customer in the fourth quarter of 2024, he said (Defense Daily, Jan. 28, 2025).

Boeing is also working with the DoD on revising the VC-25B presidential aircraft to “allow for an earlier first delivery while maintaining our focus on safety and quality,” Ortberg said.

Overall, in the quarter Boeing’s sales increased 18 percent to $19.5 billion from $16.6 billion a year ago with commercial aircraft sales up 75 percent. Sales in the Global Services segment were flat.

The net loss was $31 million, 16 cents loss per share (LPS), versus a loss of $355 million (56 cents LPS) a year ago, 76 cents a share better than consensus estimates. The Commercial Airplanes segment posted a narrower loss while Global Services was up modestly.

Ortberg also reviewed the potential impacts of the tariff wars the Trump administration has instigated with U.S. trading partners. The impacts from the purchase of supplies from international vendors were “immaterial” in the quarter, he said, noting that most of Boeing’s supply chain is in the U.S.

Ortberg also pointed out that “many” imports from Canda and Mexico are exempt from tariffs under a North American trade deal worked out in the first Trump administration. The company has suppliers in Japan and Italy that do structures work on widebody aircraft and the company is paying the 10 percent duties on these imports, costs that are expected to be recovered when the planes are exported, he said.

Retaliatory tariffs launched by other countries could impact Boeing’s ability to deliver aircraft, Ortberg said. Currently, China is the only country rejecting deliveries and Boeing is assessing options to provide these aircraft to other customers, he said.

Free cash flow in the quarter was negative $2.3 billion. Backlog stood at $544.7 billion, up 4 percent from $521.3 billion at the end of 2024. Defense backlog stood at $61.2 billion, down 4 percent from $64 billion at the end of 2024.

Allvin: ‘If We Don’t Watch It, We’re Gonna Have to Be Fightin’ From Topeka’

Advances in Chinese air defenses and the expanse of the Pacific are presenting major operations and budget challenges for the U.S. Air Force.

While the “sanctuary” of U.S. and overseas allied bases have met demands through today, such basing will be insufficient to mount air campaigns in the years ahead against technologically advanced nations, like China, Air Force Chief of Staff Gen. Dave Allvin told the Apex Defense conference in National Harbor, Md., on Tuesday.

“As you move farther and farther out, that is challenging the American airpower way of war, and if we don’t watch it, we’re gonna have to be fightin’ from Topeka,” he said. “We don’t want to do that because what this drives is, if we still intend to leverage American airpower as part of the joint force in this way, it becomes almost cost prohibitive. The ranges are excessive. The depth and the density of the air defenses make our sophisticated capabilities that we have used through stealth and precision to be able to degrade air defenses even more challenging, and it makes that even more [clear] that we’re on the wrong side of the cost curve.”

“We need to think about that in the time now where we also have the opportunity of disruptive technology…understanding that the United States Air Force still does the five things it’s always done–air superiority, precision global strike, rapid global mobility, ISR, and command and control, but we have to understand how to do it within the context of the changing character of war,” Allvin said.

His comments echo those of Air Force Maj. Gen. Joseph “Solo” Kunkel, the service’s director for force design, integration, and wargaming, who also used the “Topeka” analogy in February in a talk on the Air Force’s classified future force design–“One”–in which Kunkel said that the service would not rely on standoff, but instead also have “stand-in” forces able to operate with a high tempo in dense air defense zones (Defense Daily, Feb. 26).

Emerging needs for the Air Force look to be more air refueling booms and autonomous drones, including possibly thousands under the service’s Collaborative Combat Aircraft (CCA) program.

The Air Force wants CCA Increment 1 to be reusable air-to-air drones for the service’s Mission Area 1 of high ground threats. Increment 2 is to be a technology leap above Increment 1.

The Air Force has bestowed “mission design series” designations on the Increment 1 prototypes (Defense Daily, March 4). The General Atomics‘ Gambit offering is the YFQ-42A and Anduril Industries‘ Fury is the YFQ-44A. “Y” signifies prototype aircraft, “F” fighter/air-to-air mission, and “Q” a drone.

“CCA with small logistics footprints would improve the Air Force’s ability to periodically change their operating locations as part of a shell game to complicate China’s missile targeting,” according to Logistics While Under Attack: Key to a CCA Force Design, a recent report by the Mitchell Institute for Aerospace Studies. “Combined with active and passive airbase defenses, a resilient CCA force would help ensure the Air Force remains an ‘inside force’ that generates decisive combat airpower alongside America’s allies.”