[UPDATED with Pentagon confirmation] The better-protected, more-mobile replacement for the Humvee took a big step forward this month, when all three competitors’ vehicles completed a crucial series of military tests. All three have also completed a government Production Readiness Review to certify their ability to mass-produce their vehicle. Next comes the final Request For Proposals (RFP) for…
By Sydney J. Freedberg Jr.[CORRECTED data on competitor Oshkosh] LOCKHEED MARTIN “LIGHTHOUSE,” SUFFOLK, VA: “We’re in a really tough competition…a knife fight in [a] phone booth,” said Tom Kelly, who runs Lockheed Martin’s government relations for the Joint Light Tactical Vehicle program. In the defense contracting world writ large, Lockheed is the 800-pound gorilla. In the three-way competition to replace…
By Sydney J. Freedberg Jr.Sometimes dark clouds really do have silver linings. The winding down of two wars and the automatic spending cuts called sequestration have been brutal for the Army budget. The service recently had to cancel its top-priority weapons program, the tank-like Ground Combat Vehicle. But even if sequestration continues, said one leading analyst, ground vehicle spending…
By Sydney J. Freedberg Jr.AUSA: A recently retired general officer summed up the mood among many Army officers and defense industry officials here yesterday: “This is the worst, most depressing situation I’ve seen in 34 years of service.” The Joint Light Tactical Vehicle program is just one indicator in that depressing scenario facing the Army. The service still plans…
By Colin Clark and Sydney J. Freedberg Jr.AM General’s corporate ancestors built jeeps in World War II. The company designed and still builds the military’s iconic Humvee. But in the battle to build the Humvee’s replacement, the Joint Light Tactical Vehicle, AM General is ironically not the incumbent but the scrappy underdog. [Follow these links to read more and see video about…
By Sydney J. Freedberg Jr.WASHINGTON: The military is in for another eight years of tight budgets, Marine Corps Commandant Gen. James Amos predicted today. The good news is that the relationship between the four Joint Chiefs who craft their budgets and their chairman is “better than it ever has been.” In his public remarks, the commandant hammered home the…
By Sydney J. Freedberg Jr.AUSA: Last month’s Association of the US Army conference in Washington was a chance for contractors to show off their biggest programs, and they don’t get much bigger than the Joint Light Tactical Vehicle, a $15 billion-plus program to replace the Humvee. But for one of the three companies competing to build the JLTV, the…
By Sydney J. Freedberg Jr.AUSA: It may sound ambitious, even hubristic, that the Army wants to fold all its modernization programs into a single 30-year plan. But the long-range look is all about living within limits. The service wants to keep researching and developing 21st century weapons like the Joint Light Tactical Vehicle (JLTV) truck and the tank-like Ground…
By Sydney J. Freedberg Jr.The bomb exploded like a dusty thunderclap directly underneath the front left tire of the U.S. Army MaxxPro truck, sending the tall, roughly 20-ton vehicle lurching at least 10 feet forward and scattering chunks of the outer hull like amputated body parts. It was March 19, 2011, in the Pakhab-e-Shana in eastern Afghanistan’s breadbasket Logar…
By David AxePANAMA CITY, FLORIDA: As budgets tighten, the Navy and Marine Corps are looking at a host of ways to save, from installing LED lights on ships to slowing vehicle purchases to centralizing power on the Chief of Naval Operations’ staff. “We are entering a fiscal Valley Forge, a time of austerity,” said Ariane Whittemore, the…
By Sydney J. Freedberg Jr.[UPDATED 12:45 pm] Truck maker Navistar is withdrawing the protest it filed Friday with the Government Accountability Office over the Joint Light Tactical Vehicle program, company spokeswoman Elissa Koc told Breaking Defense this morning. Had Navistar persisted, its protest probably would have delayed JLTV development for months while the GAO investigated whether the military ran…
By Sydney J. Freedberg Jr.UPDATED: Navistar has withdrawn its protest — click here for the latest. Buy 54,599 armored trucks at $250,000 each and that works out to roughly $13.6 billion. That’s the military’s current plan to build Joint Light Tactical Vehicles (JLTVs), which will replace most of the Army and Marine Corps’ vulnerable Humvees and unmaneuverable MRAPs (The…
By Sydney J. Freedberg Jr.
Reaping the Benefits of a Global Defense Industry
After three years of the “age of austerity” in Western military spending, investors’ imperatives and corporate strategies show one indication of how the defense-industrial base will evolve over the next decade. Investors want public companies that demonstrate an attractive risk-adjusted total return, not just M&A-fueled arbitrage plays. In response, companies are husbanding or harvesting their financial…
By Steven Grundman