The Insider

By Tony Bertuca
October 30, 2023 at 5:00 AM

Senior defense officials are scheduled to speak at several events this week, including a key appropriations hearing on Capitol Hill.

Tuesday

The Senate Appropriations Committee holds a hearing on the national security supplemental spending request with Defense Secretary Lloyd Austin and Secretary of State Antony Blinken.

Wednesday

The Center for a New American Security hosts a discussion with Marine Corps Commandant Gen. Eric Smith.

The Center for Strategic and International Studies hosts a discussion with Defense Intelligence Agency Director Lt. Gen. Scott Berrier.

Thursday

The Space Force Association hosts a discussion with the deputy chief of space operations for operations, cyber and nuclear.

By John Liang
October 27, 2023 at 1:50 PM

This Friday INSIDER Daily Digest has news on the foreign military sales process, Oshkosh's and L3Harris Technologies' quarterly earnings and more.

Defense Security Cooperation Agency Director James Hursch, speaking at this week's annual Common Defense Conference, discussed the "six pressure point recommendations" that the Foreign Military Sales Tiger Team created and released in June:

DSCA director pledges continued FMS reform, signaling lessons learned from global crises

The director of the Defense Security Cooperation Agency spoke this week about Pentagon and State Department efforts to reform and streamline the foreign military sales process, detailing how work is ongoing to follow new “tiger team” recommendations and how they might impact the war in Ukraine and the future of allyships like AUKUS.

More defense contractors held their quarterly earnings calls this week:

Oshkosh Defense sales decrease after JLTV contract loss

After losing a production contract for tactical vehicles, Oshkosh Defense experienced a loss in sales in the third quarter but expects a “strong” fourth quarter and production capacity to increase, according to the company’s earnings call.

L3Harris planning to use Defense Production Act funding to boost Aerojet Rocketdyne capacity

L3Harris Technologies plans to use $216 million in Defense Production Act funding to boost capacity and long-term growth at recently acquired Aerojet Rocketdyne, executives said today.

House Select Committee on the Chinese Communist Party Chairman Mike Gallagher (R-WI) and House Foreign Affairs Indo-Pacific subcommittee Chairman Young Kim (R-CA) sent a letter to Navy Secretary Carlos Del Toro calling on the service to speed up the production and sale of weapons Taiwan needs to defend itself in the instance of a Chinese invasion, like Harpoon and SLAM-ER missiles:

Lawmakers call on Navy to accelerate Taiwan weapons transfers including Harpoon and SLAM-ER missiles

Lawmakers are calling on the Navy to speed up the production and delivery of weapons to Taiwan and are demanding an explanation for months-long delays in the transfer of two key missile systems in a letter to Navy Secretary Carlos Del Toro.

Document: Lawmakers' letter to Navy on weapons sales to Taiwan

A final request for proposals for the missile warning and tracking satellite program will be released in the "May timeframe," according to a U.S. Space Command official:

SSC plans to award contracts for 18 MW/MT satellites by early 2025

U.S. Space Systems Command is expecting to award contracts for 18 new missile warning and tracking satellites between late 2024 and early 2025, a senior command official said last week.

By Dan Schere
October 27, 2023 at 12:47 PM

The Army last week awarded a $15 million contract for a mission systems flying test bed, which comes in response to a broad agency announcement from earlier this year.

Sierra Nevada Corp., based in Sparks, NV, was awarded a $15 million cost-plus fixed-fee contract for a mission systems flying test bed on Oct. 20, according to a Defense Department announcement.

The broad agency announcement, released in March, called for the fielding of a mission systems flying test bed on the Army’s future vertical lift platforms. It will use air vehicle digital backbones, automated software integration and mission system software, the notice stated. At the time of the announcement, the Army said as many as six contracts could be awarded.

Lt. Col. Christina Wright, a spokeswoman for Army Contracting Command, confirmed to Inside Defense this week that the Oct. 20 contract is related to the March BAA. However, Army officials didn't have additional details about the contract.

Sierra Nevada spokeswoman Elizabeth Hogue told Inside Defense Wednesday that the company is unable to provide additional details due to “contract restrictions.”

By Tony Bertuca
October 26, 2023 at 3:27 PM

The Defense Department has plans to send two U.S.-based Iron Dome air defense batteries to Israel, along with additional missile interceptors, according to Brig. Gen. Pat Ryder, the Pentagon's chief spokesman.

Ryder, “for security reasons,” declined to say where the Iron Dome batteries, made by Israeli company Rafael, would be stationed and when they are expected to be operational in Israel’s conflict against Hamas.

President Biden, in his recent emergency spending request to Congress, is seeking $4 billion in DOD procurement funds that would be transferred to Israel “for the procurement of the Iron Dome Defense System capabilities and David’s Sling short-range ballistic missile defense in order to counter short-range rockets and mortar threats.”

Additionally, the administration seeks $1.2 billion for research, development, test and evaluation work on Iron Beam, a proposed laser upgrade to Iron Dome.

Meanwhile, the Pentagon has tapped 900 U.S. military personnel to deploy or to prepare to deploy to the Middle East, along with Patriot and Terminal High Altitude Air Defense systems, though Ryder stressed they are not going to Israel.

The U.S. troops and air defense systems, Ryder said, are "intended to support regional deterrence efforts and further bolster U.S. force protection capabilities.”

Ryder said U.S. and coalition forces in the Middle East have been attacked by Iran-backed groups using a mix of rockets and drones at least a dozen separate times in Iraq and four separate times in Syria between Oct. 17 and Oct. 26, including one attempted attack today against U.S. forces in Erbil, Iraq.

Ryder said 21 total U.S. personnel have suffered minor injuries during the attacks on Oct. 17 and Oct. 18, with some being diagnosed with traumatic brain injury. He said all have returned to duty.

Ryder declined to discuss any potential U.S. response to the attacks.

“We will reserve the right to self-defense,” he said. “I’m not going to telegraph any response other than to say we would do so at a time and place of our choosing.”

By Shelley K. Mesch
October 26, 2023 at 3:13 PM

The Defense Department has yet to implement more than a dozen recommendations from the Government Accountability Office to improve oversight and monitoring of its nuclear enterprise, according to a report released today.

The open recommendations are gathered in a GAO National Security Snapshot report focused on oversight of the enterprise.

DOD is in the midst of modernizing all three legs of the nuclear triad -- air with the B-21 Raider and upgrades to the B-52 Stratofortress, land with the Sentinel Intercontinental Ballistic Missile and sea with the Columbia-class submarine. DOD anticipates these efforts and the enterprise could cost up to $350 billion over the next two decades.

Among the recommendations, DOD should set clear roles and responsibilities for its nuclear oversight organization -- the Deputy’s Management Action Group -- including how the DMAG communicates with other organizations that have responsibilities for parts of the enterprise, according to the GAO.

DOD and the National Nuclear Security Administration should establish a joint risk management process to identify, assess and respond to risks to the enterprise, the report states, and report those risks and mitigation efforts to internal and external stakeholders.

DOD should also establish prioritization criteria for the enterprise’s activities that can be applied whenever changes to the portfolio are proposed or reviewed, GAO states.

The open recommendations stem from reports on the enterprise dating between 2018 and 2022.

By Dan Schere
October 26, 2023 at 2:25 PM

The Army has chosen Elbit Systems of America to develop and qualify a prototype for the service's new Joint Effects Targeting System (JETS II) variant, the company announced Thursday.

Nearly a year ago, the Army released a request for prototype proposals for JETS II to solicit information from the private sector.

The Army, in its RPP, indicated that it intends to integrate a military code GPS receiver to handle call-for-fire missions. It will be used for “coordinate seeking, laser guided and conventional munitions,” according to the service.

The Army selected Elbit America to develop and qualify a prototype JETS II product, which will make targeting “easier and more precise” and will provide “faster effects on targets” according to the company. Development of the prototype system will be done at Elbit America’s Merrimack, NH facility through 2026.

Elbit America’s handheld system “allows soldiers to rapidly prosecute threats in all operational environments,” including for contested battlefields. The company’s system will ensure that “forward observers in the U.S. Army can operate with exceptional mobility, lethality and survivability, no matter where the battle takes place,” Erik Fox, the vice president of warfighter systems for Elbit America said in a statement Thursday.

“Responding to soldier feedback on such systems, we are designing a prototype lightweight JETS II system so it can be carried and effortlessly set up, shaving precious time off the targeting process in the field,” he said.

By John Liang
October 26, 2023 at 2:14 PM

This Thursday INSIDER Daily Digest has news on international cooperation in expanding global weapons production, a recent Navy missile defense intercept test plus defense contractors' quarterly earnings and more.

We start off with the Defense Department's top acquisition official saying international cooperation will be key to expanding global weapons production, especially for munitions:

DOD pushing new defense industrial strategy to expand weapons stockpiles

Pentagon acquisition chief Bill LaPlante, a key official behind the Biden administration's effort to again make the United States an "arsenal of democracy," said a forthcoming National Defense Industrial Base Strategy will underscore ongoing work to surge global weapons production as a means of deterring U.S. adversaries.

We also have news about a successful Navy missile defense intercept test:

In a first, Navy destroyer intercepts ballistic missile and anti-ship drone threats at the same time

For the first time, an Arleigh Burke-class destroyer simultaneously intercepted short-range ballistic missile threats and anti-ship drone threats during an Integrated Air and Missile Defense test, according to a Wednesday Missile Defense Agency announcement.

Followed by defense contractors' quarterly earnings calls:

VC-25B issues helped drag down Boeing defense margins in third quarter

Continuing issues with the VC-25B, the eventual replacement for presidential escort aircraft Air Force One, were contributing factors to negative margins in Boeing’s defense sector for the third quarter of 2023, company executives noted during an earnings call Wednesday.

GD execs: Submarine supply chain remains 'very fragile' while workforce picture improves

General Dynamics Electric Boat continues to receive late deliveries of submarine components from a "very fragile" supply chain, company executives said, noting enduring production challenges within the Navy's two critical submarine programs.

International demands highlight Northrop's Q3 earnings with record backlog

The continuing war in Ukraine and increasing geopolitical tensions elsewhere has led to increased sales for Northrop Grumman, which reported a record backlog of $84 billion during its third-quarter earnings call.

Lower IRAD costs with FLRAA helped Bell in third quarter

Bell, a Textron subsidiary, spent less money in the third quarter on independent research and development for programs such as the Army's Future Long-Range Assault Aircraft, the company's CEO said during a Thursday earnings call.

The House Armed Services seapower and projection forces subcommittee held a hearing this week on "The Submarine Industrial Base and its Ability to Support the AUKUS Framework":

Houston: Maintenance backlogs pose greatest challenge to submarine readiness

Maintenance backlogs pose the greatest challenge to submarine fleet readiness, according to a senior Navy official, who today said the service is on track to reach an 80% operational availability rate for its attack submarines by late 2027 or early 2028.

Document: House hearing on AUKUS and the submarine industrial base

By Tony Bertuca
October 26, 2023 at 12:52 PM

The Defense Department today announced it would transfer $150 million in weapons to Ukraine that will need to be replenished by U.S. defense contractors, highlighting the positive impact the move will have on American jobs as some in Congress, especially the GOP-led House, remain opposed to further spending that would aid Kyiv.

“Security assistance for Ukraine is a smart investment in our national security,” DOD said in a press release. “It helps to prevent a larger conflict in the region and deter potential aggression elsewhere, while strengthening our defense industrial base and creating highly skilled jobs for the American people.”

The package includes:

• Additional munitions for National Advanced Surface-to-Air Missile Systems (NASAMS);

• AIM-9M missiles for air defense;

• Stinger anti-aircraft missiles;

• Additional ammunition for High Mobility Artillery Rocket Systems (HIMARS);

• 155mm and 105mm artillery rounds;

• Tube-Launched, Optically-Tracked, Wire-Guided (TOW) missiles;

• Javelin anti-armor systems;

• More than 2 million rounds of small arms ammunition;

• Night vision devices;

• Demolition munitions for obstacle clearing;

• Cold weather gear; and

• Spare parts, maintenance, and other ancillary equipment.

The transfer is being implemented via presidential “drawdown” authority, the 49th such action for Ukraine since August 2021.

“This package utilizes assistance previously authorized for Ukraine during prior fiscal years under Presidential Drawdown Authority (PDA) that remained after the PDA revaluation process concluded in June,” DOD said.

Meanwhile, the Pentagon says it is running low on funds to aid Ukraine and President Biden has requested $61.4 billion in security and humanitarian assistance for Kyiv in his $106 billion emergency supplemental spending request.

Despite broad bipartisan support for Ukraine, it is unclear how Congress will respond in terms of aid as the House GOP recently elected Rep. Mike Johnson (R-LA) as speaker. He voted against a measure in September that would have given $300 million in security assistance to Ukraine and in February posted on X that American taxpayers “deserve to know if the Ukrainian government is being entirely forthcoming and transparent about the use of this massive sum of taxpayer resources.”

DOD, meanwhile, said the new security assistance package is a “another visible signal of the United States’ continued commitment to supporting the Ukrainian people in the face of Russian aggression.”

By Nick Wilson
October 26, 2023 at 12:34 PM

The Navy successfully launched a Standard Missile-6 from Littoral Combat Ship Savannah (LCS-28) using a “containerized launching system” during a Tuesday demonstration in the Eastern Pacific, according to a Navy announcement.

The test demonstrates the utility of the LCS class for surface warfare and is a promising sign for the Navy’s efforts to develop containerized weapon systems that can be installed on LCSs and other surface ships, according to the sea service.

“The exercise demonstrated the modularity and lethality of Littoral Combat Ships and the ability to successfully integrate a containerized weapons system to engage a surface target,” the announcement states.

“The exercise will inform continued testing, evaluation and integration of containerized weapons systems on afloat platforms,” it continues.

Savannah is an Independence-class LCS, delivered to the Navy in 2021 and commissioned in February 2022. The vessel is not among the seven LCSs the Navy has marked for decommissioning over the next five years.

In September, Inside Defense reported the Navy plans to equip all remaining LCSs with the Naval Strike Missile by fiscal year 2032 in an effort to expand the vessels’ offensive strike capabilities and enhance their contribution to the surface fleet.

By Nickolai Sukharev
October 25, 2023 at 8:30 PM

Ammunition manufacturers will have an opportunity to produce 105mm high-explosive rounds for the Army's newest armored combat vehicle, according to an Oct. 10 public announcement.

Designed to be fired from the M10 Booker, the Army is seeking contractors that can produce the 105mm M393A3 High Explosive Plastic (HEP) cartridges capable of defeating bunkers and breaching double reinforced concrete walls, the announcement states, which was updated on Oct. 19.

“Production facilities must be in place or require minimal effort to establish,” the announcement adds.

Annual production quantities will range from 3,500 to 6,500 for a fixed-term contract with production deliveries lasting up to 34 months, the announcement reads.

Manufacturing will also include M393A3 HEP-T, a tracer round that can illuminate for more than five seconds.

The M939A3 comes from a family of ammunition, which includes canister and training variants.

The round can be fired from the M68 tank gun, which was used on the Army’s earlier combat vehicles, and the XM35 tank gun, which is used on the M10.

By Nick Wilson
October 25, 2023 at 4:28 PM

The Defense Department is preparing to brief lawmakers on the findings of a recent AUKUS-focused industrial base study, acting Deputy Under Secretary of Defense for Policy Mara Karlin told the House Armed Services seapower and projection forces subcommittee today.

While Karlin said the Pentagon is working to organize briefings on the study, she didn't commit to providing physical copies of the report to lawmakers when pressed on the subject by Rep. Mike Gallagher (R-WI).

“I believe that some briefings have occurred, and some additional briefings will occur to you and your staff. I think folks are just scheduling those right now,” Karlin told the subcommittee. “I think their plan is to brief you on the cost estimates from the study and to walk through the substance of it.”

Gallagher and subcommittee Chairman Trent Kelly (R-MS) both asked that physical copies of the report be provided.

Last week, a bipartisan group of senators led by Sen. Roger Wicker (R-MS) sent a letter to the White House requesting this AUKUS implementation study, performed by DOD’s cost assessment and program evaluation office, be provided to Congress by the end of the month.

The Navy, Office of the Secretary of Defense and White House all declined requests from Inside Defense to provide a specific timeline for when the report’s contents would be shared with Congress.

Speaking today, Karlin also noted that the results of the study informed the White House’s supplemental spending request, which includes $3.4 billion for DOD to invest in the U.S. submarine industrial base.

By Shelley K. Mesch
October 25, 2023 at 4:19 PM

The Air Force is conducting "ground taxi activities" with the B-21 Raider ahead of the bomber's first flight, the service said.

“Rigorous testing is a critical step in the B-21 flight test program,” according to a statement from the Air Force. “Extensive testing evaluates systems, components and functionalities. This testing allows us to mitigate risks, optimize design and enhance operational effectiveness.”

Air Force officials have said the bomber’s first flight is expected by the end of the year, stipulating that the test won’t be rushed to meet a calendar date.

Unveiled for the first time in December, the B-21 is being touted as the world’s first sixth-generation aircraft. It’s being designed to run long-range, nuclear-capable operations.

The B-21 will replace the B-1 Lancer and B-2 Spirit in the nuclear bomber fleet as part of a two-platform approach with upgraded B-52 Stratofortresses rounding out the fleet.

By Nickolai Sukharev
October 25, 2023 at 3:15 PM

The Army is conducting a market survey for 155mm ammunition designed to defeat armored and mechanized targets, according to a public announcement.

The survey is requesting potential sources who can produce the XM1180 Cannon-Delivered Area Effects Munition (C-DAEM) for early operational capability fielding “to begin production at a low rate by 2nd Quarter Fiscal Year 2026,” the Oct. 18 announcement reads.

Requirements are planned to be restricted to Raytheon in Tucson, AZ, the announcement adds.

“It will support both current and future weapon systems and defeat infantry fighting vehicles, self-propelled howitzers, and main battle tanks,” the announcement states. “The Army requires the solution to be compatible with current 39 caliber weapon systems and engage targets out to 35 kilometers (km).”

The 155mm XM1180 C-DAEM round is designed to be fired from the Army’s forthcoming Extended Range Cannon Artillery vehicle, a replacement for the Paladin, and provides an armor defeat capability in both deep fires counter-fire engagements and close fires maneuver support, according to the Joint Program Executive Office for Armaments and Ammunition.

The XM1180 round will serve alongside the 155mm XM1208 Dual Purpose Improved Conventional Munitions round, the Joint Program Executive Office states.

Earlier this year, the Army requested permission from Congress to re-allocate funds to upgrade Raytheon's Excalibur C-DAEM munition, Inside Defense reported.

By John Liang
October 25, 2023 at 2:59 PM

HII announced today that it has hired retired British Army Brig. Gen. Paul Tennant to be corporate vice president of engagement and international government relations.

Tennant will succeed Joe Tofalo, who will retire in December after five years with the company. Tennant will report directly to Stewart Holmes, HII's executive vice president of government and customer relations.

Among his duties, Tennant will lead and provide oversight "on international initiatives, including the trilateral Australia, United Kingdom and United States (AUKUS) partnership and will coordinate engagement with foreign governments, embassies and relevant organizations," according to an HII statement.

Tennant is a former British military attaché in Canada as well as the United States. An army aviator, he served on multiple deployments in Northern Ireland and Afghanistan. Additionally, he was chief of the Joint Fires and Influence Branch, Headquarters, Allied Rapid Reaction Corps, NATO, and served on exchange to the U.S. Army as special assistant to then-Chief of Staff Gen. Raymond Odierno.

By John Liang
October 25, 2023 at 2:23 PM

This Wednesday INSIDER Daily Digest has news on the Pentagon's continued focus on China as the "pacing challenge" identified in the 2022 National Defense Strategy, the Defense Department reshuffling of 155mm artillery rounds to support Israel's fight against Hamas and more.

Mara Karlin, assistant defense secretary for strategy, plans and capabilities, who is also performing the duties of the deputy defense under secretary for policy, spoke at the Brookings Institute this week about the Pentagon's continued focus on China as the "pacing challenge" identified in the 2022 National Defense Strategy:

DOD policy official: Focus remains on China, despite competing global crises

A senior Pentagon policy official said today that the United States intends to keep its focus on deterring China, despite addressing ongoing crises in Ukraine and Israel.

The reshuffling of 155mm ammunition stocks to Israel highlights the Pentagon's ongoing efforts to supply two allies simultaneously as top defense officials work with foreign nations to surge overseas weapons production:

DOD reshuffles artillery shipments to aid Israel amid work to surge NATO weapons production

The Defense Department says shipments of 155mm artillery shells that were withdrawn from U.S. stocks in Israel and slated to shore up Army weapons reserves in Europe that have been depleted by ongoing aid to Ukraine have now been diverted back to Israel as that country amps up its attacks on Hamas and Hezbollah.

On Sept. 8, the 2nd Multi-Domain Task Force completed an exercise called Arcane Thunder 23 -- the inaugural event of a series the Army plans to conduct annually -- that allowed the unit, with participation from France, Poland, Romania and the United Kingdom, to work on reconnaissance, target development and precision-targeting operations:

New Army unit generates artillery targets from electromagnetic spectrum, tracks satellites

The Army last month completed a first-ever, live-fire exercise in Europe of a unit designed to break up Russia's anti-access/area-denial capabilities, dispersing troops across Germany, Poland and Romania to test and experiment elements of multidomain operations by synchronizing precision effects across the continent.

A new Congressional Budget Office cost estimate looks at the AUKUS Oversight and Accountability Act, advanced by the House Foreign Affairs Committee in July, which would establish a State Department task force to oversee implementation of the AUKUS security partnership:

CBO: AUKUS legislation would invest $115M in implementation with little draw on appropriations

A legislative proposal that aims to fund AUKUS oversight using fees collected through the foreign military sales process would, if enacted, direct $115 million of mandatory spending into AUKUS implementation efforts over the next decade, while drawing little in appropriations, according to a Congressional Budget Office cost estimate.

Document: CBO cost estimate of AUKUS bill

RTX executives discussed their quarterly earnings with Wall Street analysts this week:

RTX suffers loss due to a metal powder quality crisis affecting engines

RTX (formerly Raytheon Technologies) reported a 21% drop in sales compared to the previous year due to a metal powder quality crisis that led to engine failure of the V2500 engine fleet, the company said in its third-quarter earnings statement.