The Insider

By Nickolai Sukharev
July 31, 2024 at 1:07 PM

(Editor's Note: A previous version of this story indicated that Oshkosh's tactical truck sales would offset the loss of the Joint Light Tactical Vehicle contract. The story has been amended to indicate that the company expects tactical contract extensions following the loss of the JLTV contract.)

Oshkosh expects contract extensions for heavy and medium tactical trucks following a production drawdown for the Joint Light Tactical Vehicle, company executives said during a quarterly earnings call today.

The Wisconsin-based company reported a 20.2% sales increase in their defense segment during the second quarter of 2024, driven by higher tactical truck sales.

“While domestic JLTV production will wind down in early 2025, we continue to supply the [Defense Department] on many important programs including [Family of Heavy Tactical Vehicles] and [Family of Medium Tactical Vehicle] programs,” John Pfeifer, the company's president and CEO, said during an earnings call.

Overall, the company reported an 18% sales increase from the same quarter last year, an increase of $433.8 million to $2.85 billion, driven by organic sales in all segments, according to a company statement.

“We believe these key programs as well as other programs such as Stryker [Medium Caliber Weapon System] and the Rogue Fires family of carriers provide enhanced profitability and important visibility for the business into the future,” Pfeifer added during the call.

The MCWS program intends to arm a portion of the Army’s Stryker infantry carrier vehicles with 30mm cannons while the Marine Corps Rogue Fires program uses the JLTV as a wheelbase for coastal anti-ship missiles.

The JLTV is designed for combat operations and will replace a portion of the Army’s humvees.

In January 2023, the Army awarded AM General a follow-on production contract for the JLTV. In June 2023, the Government Accountability Office denied Oshkosh's protest of the decision.

Oshkosh will continue to produce the JLTV for the Army in 2025 along with international orders. Last December, the company announced it would produce the vehicle for Israel.

Pfeifer added that the company received a $232 million order for the Family of Heavy Tactical Vehicles, which will be the last order of the current contract for the vehicles but expects a five-year extension to the contract in August 2024.

He added he expects a similar extension for the FMTV in early 2025.

The company is developing the A2 variant of the FMTV, which features a more powerful engine, and improved capabilities compared to the previous A1 variant.

Oshkosh is also competing with Textron, HDT and General Dynamics for the Robotic Combat Vehicle, an unmanned vehicle designed to operate alongside manned units.

Additionally, the company faces Navistar, Mack Defense as well as a joint bid American Rheinmetall and General Motors Defense for the Common Tactical Truck, a replacement program for the FHTV.

Pfiefer added that orders for the company’s Next Generation Delivery Vehicle, a new mail carrier vehicle for the United States Postal Service, will "exceed the decline of JLTV revenue from 2024 to 2025."

By John Liang
July 31, 2024 at 11:06 AM

Boeing's board of directors has elected Kelly Ortberg as the company's new president and CEO.

Ortberg succeeds Dave Calhoun, who earlier this year announced his intention to retire from the company, having served as president and CEO since January 2020 and as a member of Boeing's board of directors since 2009.

Ortberg began his career in 1983 as an engineer at Texas Instruments, then joined Rockwell Collins in 1987 as a program manager and rose through the ranks to become its president and CEO in 2013. He then steered that company's integration with United Technologies and RTX until his retirement from RTX in 2021.

In addition to serving on RTX's board of directors, Ortberg serves on vehicle systems company Aptiv PLC's board and is the former chair of the Aerospace Industries Association board of governors.

By Dan Schere
July 30, 2024 at 4:13 PM

The Army has selected Enveil, a Fulton, MD-based company specializing in data privacy, to provide secure AI capabilities for Project Linchpin -- the service's new artificial intelligence and machine learning pipeline.

Enveil was awarded a contract through the Army’s xTechPrime competition, a forum for small businesses and technology integrators, according to a company announcement last week.

Enveil’s ZeroReveal Machine learning solutions will enable the encryption of models that have been “trained over sensitive data,” according to the company. Users will then “evaluate them in their encrypted state across data silos and boundaries, including untrusted, lower trusted or third-party data environments.”

Models are the unit of work for AI/ML, and often have a great deal of sensitivity associated with them, Enveil CEO Ellison Anne Williams explained in a July 30 interview with Inside Defense. The models can be “trained” or “made smarter” over data, and in the Army’s case, the goal is to run a sensitive model in as many locations as possible.

“What we enable, in terms of that trusted AI/ML ops pipeline, is the ability to take that model that’s sensitive, which could be looking for a whole host of things under Project Linchpin, and then now you can go park it out on the back of that truck on a sensor platform. So, as it’s driving around, it’s pulling all the data from the environment. That data can now be streamed past that encrypted model,” she said.

Project Linchpin will initially support the Tactical Intelligence Targeting Access Node (TITAN) ground stations, as well as large language models used to support the Army Intelligence Data Platform, officials have said. Palantir was awarded a contract for TITAN in March.

By Nickolai Sukharev
July 30, 2024 at 2:06 PM

The Army is asking industry to manufacture antilock brake and stability control systems for the service's humvee fleet in a decade-long effort to reduce fatalities resulting from rollovers, according to a public notice.

Issued as a sources-sought notice, interested manufacturers are “to design, develop, manufacture, supply and install/troubleshoot an anti-lock brake system with electronic stability control retrofit kit onto the high mobility multipurpose wheeled vehicle that meets the requirements defined in the ABS/ESC Retrofit Kit Army Tank Purchase Description,” the Monday announcement reads.

The announcement is part of the Army’s effort to retrofit its humvee fleet with kits designed to prevent rollovers by 2035, which have resulted in nine deaths.

Retrofits take place at Red River Army Depot near Texarkana, TX and 15 other sites across the continental United States as well as locations in Hawaii, Japan, Korea and Puerto Rico, Col. Jonathan Meisel, the depot commander, wrote in an email to Inside Defense earlier this year.

Selected manufacturers “will be expected to install” the kits at 15 work sites as well as potential overseas locations, the announcement adds.

“Sources will also be expected to troubleshoot and resolve any mechanical and/or software faults experienced during installations of the referenced ABS/ESC kit on humvees, which may include understanding, addressing and clearing software fault codes as well as resolving mechanical or technical issues,” the announcement reads.

Last month, Senate authorizers included a provision in their final draft of the fiscal year 2025 defense authorization bill that requested the Army submit a plan to finish the retrofit program five years early.

In April 2023, the Army retrofitted 325 humvees per month while the rate in 2024 has fluctuated based on congressional funding, Inside Defense reported earlier this year.

While a common denominator in the rollovers is the failure to use restraints, the magazine adds that studies by the Army Combat Readiness Center identified other contributing factors, including a lack of route planning, failure to adhere to payload plans and excessive speed around corners, among others, according to the Army’s Risk Management magazine.

To increase the survivability, the Army trained soldiers on how to prevent rollovers and exit an overturned vehicle. The Army also developed a hydraulic simulator designed to mimic the motions of a rollover.

By John Liang
July 30, 2024 at 1:39 PM

This Tuesday INSIDER Daily Digest has news on the Collaborative Combat Aircraft program, the Replicator drone program, hypersonic strike and more.

We start off with coverage from this week's Life Cycle Industry Days conference:

Air Force selects five vendors to build CCA autonomy

DAYTON, OH -- A mix of five traditional and non-traditional businesses have received contracts to develop the mission autonomy for the first increment of Collaborative Combat Aircraft, Air Force Brig. Gen. Jason Voorheis, program executive officer for fighters and advanced aircraft, said Monday.

Air Force Under Secretary Melissa Dalton spoke this week at an event hosted by the Brookings Institution:

Dalton says Air Force seeks 'cost-effective mass' amid CCA development

The Air Force needs more money to modernize key weapon systems, though the service is beginning to shift toward "cost-effective mass," the service's under secretary said Monday.

A new Government Accountability Office report finds that most of the Defense Department's efforts to develop hypersonic weapons "aren't using modern digital engineering tools, such as virtual representations of physical products":

Pentagon plans at least $45 billion in offensive hypersonic strike acquisition

The U.S. military has committed to more than $45 billion in offensive hypersonic strike capabilities, excluding likely procurement for cruise-missile variants of new ultrafast maneuvering weapons, according to a congressional audit of the new technology portfolio that provides a first picture of total planned acquisition costs.

Document: GAO report on hypersonic weapons

The Defense Department inspector general's office is looking into the Replicator drone program:

Pentagon IG to review Replicator program

The Pentagon's top watchdog will review the Defense Department's Replicator effort, which aims to field thousands of inexpensive, autonomous drones by August 2025 to counter China's military mass in the Indo-Pacific, according to a memorandum issued Monday.

The Commission on the National Defense Strategy released its consensus final report this week, describing the most serious threats to U.S. national security since World War II:

New National Defense Strategy Commission backs spending surge

The newest incarnation of the bipartisan National Defense Strategy Commission has sent a report to Congress echoing a key recommendation of the previous commission: the Pentagon needs more money and lawmakers should act accordingly.

Document: Commission on National Defense Strategy final report

The Integrated Capabilities Office, which stood up July 19, is a secretariat-level office designed to continue the work of Air Force Secretary Frank Kendall's Operational Imperatives for modernizing the service for current potential threats:

Air Force stands up Integrated Capabilities Office to tackle operational imperatives

The Air Force this month stood up the first in a series of offices designed to better integrate capabilities across the service's organizations as part of its restructuring plan announced earlier this year.

By Tony Bertuca
July 30, 2024 at 11:23 AM

The Senate Armed Services Committee voted Tuesday to advance two key Pentagon cyber and intelligence nominees.

The committee voted to approve the nominations of Tonya Wilkerson to be under secretary of defense for intelligence and security and Michael Sulmeyer to be assistant secretary of defense for cyber policy. If confirmed, Sulmeyer will be the first ASD for cyber policy to ever serve at the Defense Department.

The nominees now advance to the full Senate for confirmation votes.

By John Liang
July 30, 2024 at 10:07 AM

Leidos today announced the appointment of Ron Keesing as chief AI officer.

"In this role, Keesing will lead Leidos' strategic initiatives advancing Trusted Mission AI solutions and deploying those solutions across all customer missions," the company said in a statement.

Keesing has worked for Leidos since March 2004, was the founding director of the company's AI Accelerator and most recently served as senior vice president of technology integration, "responsible for driving mission-critical AI as a core discriminator of the company's data-driven solutions."

By Vanessa Montalbano
July 30, 2024 at 9:49 AM

Like families often do, the Next Generation Air Dominance family of systems has recently found itself in turmoil, with the Air Force now reconsidering its original vision for the sixth-generation fighter to ensure it is well-suited against evolving threats in the Indo-Pacific.

“Before we make the commitment that we're close to making, we want to make sure we get the right design concept there,” Air Force Secretary Frank Kendall said last week.

This story is now available to all.

By John Liang
July 29, 2024 at 2:26 PM

This Monday INSIDER Daily Digest has news on a billion-dollar Standard Missile contract, the Defense Innovation Unit looking to upgrade capabilities for U.S. combatant commanders and more.

On Jan. 25, the Missile Defense Agency announced a $1.9 billion fixed-price incentive and cost-plus-fixed-fee contract to Raytheon Technologies for the manufacture and assembly of Standard Missile-3 Block IIA interceptors:

U.S., Japan execute nearly $2 billion contract for SM-3 Block IIA

The U.S. military executed a contract potentially worth $2 billion for an unspecified number of Standard Missile-3 Block IIA interceptors, a deal that rolls up orders for the Missile Defense Agency and Japan for the most advanced -- and most expensive -- variant of the Aegis guided missile system.

Congress supplied the Defense Innovation Unit with close to $1 billion for fiscal year 2024, $220 million of which was set aside to enable U.S. combatant commanders:

DIU's EUCOM lead gives inside look into Ukraine's emerging tech priorities

The Defense Innovation Unit is focusing on upgrading capabilities for U.S. combatant commanders, including integrated air defense, command and control, counter-drone systems and autonomy, with emerging technology discussions being mostly driven by the war in Ukraine, the organization's U.S. European Command lead told Inside Defense.

Our colleagues at Inside Cybersecurity have the latest cyber defense news:

Defense groups encourage CISA to work with DOD in establishing mandatory reporting requirements for covered entities

The Cybersecurity and Infrastructure Security Agency should consider current reporting requirements for defense contractors as it continues work to implement a mandatory incident reporting regime that goes across critical infrastructure sectors, according to defense groups who filed comments on CISA's upcoming regulation.

The House Oversight and Accountability national security, the border and foreign affairs subcommittee held a hearing last week on "Wasteful Spending and Inefficiencies: Examining DOD Platform Performance and Costs":

House lawmakers probe experts on DOD procurement dysfunction

House lawmakers questioned a panel of experts yesterday about the poor performance and ballooning costs of Pentagon weapons programs, focusing many of their comments on the F-35 Joint Strike Fighter, which has struggled for years with cost, schedule and performance issues.

Could the Army set up its own internal "space branch?" Only time will tell:

Army moving toward establishment of space MOS

A plan to create a new Army space-related military occupation specialty (MOS) is in the works, according to Army Space and Missile Defense Command Commander Lt. Gen. Sean Gainey. The creation of a space MOS could lead to the eventual establishment of a “space branch” of the service, Gainey said during two events this week in Washington.

By Tony Bertuca
July 29, 2024 at 12:57 PM

The Defense Department announced a $1.7 billion military aid package for Ukraine that will immediately transfer some U.S. weapons to the battlefield.

A Presidential Drawdown Authority action valued at up to $200 million includes air defense interceptors, munitions for rocket systems and artillery as well as anti-tank weapons, according to DOD.

Meanwhile, $1.5 billion is being put on contract via the Ukraine Security Initiative to provide long-term military assistance to include:

  • Munitions for National Advanced Surface-to-Air Missile Systems (NASAMS)
  • Short- and medium-range air defense munitions;
  • RIM-7 missiles for air defense;
  • Electronic Warfare equipment;
  • Ammunition for High Mobility Artillery Rocket Systems (HIMARS);
  • 155mm and 105mm artillery rounds;
  • 120mm mortar rounds;
  • Precision aerial munitions;
  • Tube-Launched, Optically Tracked, Wire-Guided (TOW) missiles;
  • Javelin and AT-4 anti-armor systems;
  • Small arms;
  • Explosives material and demolitions equipment and munitions;
  • Secure communications systems;
  • Commercial satellite imagery services; and
  • Spare parts, maintenance and sustainment support and other ancillary equipment.

“This is the Biden Administration's twentieth USAI package and sixty-second tranche of equipment to be provided from DOD inventories for Ukraine and since August 2021,” DOD said.

By Tony Bertuca
July 29, 2024 at 5:00 AM

Senior defense officials are scheduled to speak around Washington this week. The House is on August recess and Defense Secretary Lloyd Austin is traveling in Asia.

Monday

The Mitchell Institute hosts a discussion with Air Force Vice Chief of Staff Gen. James Slife.

The Brookings Institution hosts a discussion on air and space power with Air Force Under Secretary Melissa Dalton.

Tuesday

The Senate Armed Services Committee meets to discuss the findings of the National Defense Strategy Commission.

The Mitchell Institute hosts a discussion with the chief of U.S. Air Forces in Europe, Africa and Allied Air Command.

The Center for Strategic and International Studies hosts a discussion on the defense of Guam.

Wednesday

The Mitchell Institute hosts a discussion on aerospace technology with the special assistant to the Air Force secretary.

Thursday

The Senate Appropriations Committee meets to draft its version of the fiscal year 2025 defense spending bill.

The Center for Strategic and International Studies hosts a discussion on nuclear threats and the role of allies.

By John Liang
July 26, 2024 at 2:07 PM

This Friday INSIDER Daily Digest has coverage of a congressional hearing on wasteful defense spending, the Army looking into setting up its own internal "space branch," the Air Force's B-52 engine replacement effort and more.

The House Oversight and Accountability national security, the border and foreign affairs subcommittee held a hearing this week on "Wasteful Spending and Inefficiencies: Examining DOD Platform Performance and Costs":

House lawmakers probe experts on DOD procurement dysfunction

House lawmakers questioned a panel of experts this week about the poor performance and ballooning costs of Pentagon weapons programs, focusing many of their comments on the F-35 Joint Strike Fighter, which has struggled for years with cost, schedule and performance issues.

Document: House hearing on wasteful DOD spending

Could the Army set up its own internal "space branch?" Only time will tell:

Army moving toward establishment of space MOS

A plan to create a new Army space-related military occupation specialty (MOS) is in the works, according to Army Space and Missile Defense Command Commander Lt. Gen. Sean Gainey. The creation of a space MOS could lead to the eventual establishment of a "space branch" of the service, Gainey said during two events this week in Washington.

Earlier this summer, the Air Force cleared for publication a Modernized Selected Acquisition Report on the B-52 CERP program, shedding new light on cost estimates for the program, that are now pegged to be $12.9 billion, including $4.3 billion for research and development and $8.3 billion for procurement:

Air Force eyes $13B B-52J price tag, formal cost estimate to be locked in September

The latest preview of the B-52 Commercial Engine Replacement Program indicates the project will carry a nearly $13 billion price tag when the Air Force this fall establishes a formal cost and schedule for the effort to extend the service life of the Cold War-era bombers by giving the fleet a new power plant.

Earlier this month, Military Sealift Command published a sources-sought notice signaling the Marine Corps' intent to charter a new Jones Act-compliant stern landing vessel for one 12-month base period beginning in August 2024, with options for two additional 12-month extensions:

Marine Corps plans to charter new stern landing vessel from Australian shipbuilder Sea Transport Solutions

The Marine Corps Warfighting Laboratory is preparing to lease a new stern landing vessel that will be "purpose-built from the ground up" by Australian shipbuilder Sea Transport Solutions (STS), a service spokesperson told Inside Defense.

Last but by no means least, the latest cyber defense news from our colleagues at Inside Cybersecurity:

Defense groups encourage CISA to work with DOD in establishing mandatory reporting requirements for covered entities

The Cybersecurity and Infrastructure Security Agency should consider current reporting requirements for defense contractors as it continues work to implement a mandatory incident reporting regime that goes across critical infrastructure sectors, according to defense groups who filed comments on CISA's upcoming regulation.

By Vanessa Montalbano
July 25, 2024 at 3:43 PM

Greece today signed a formal deal to purchase 20 F-35A Joint Strike Fighters, making it the 19th country to fly the fifth-generation aircraft, according to an announcement from plane-maker Lockheed Martin.

“We are excited to welcome Greece into the F-35 enterprise,” Air Force Lt. Gen. Mike Schmidt, F-35 program executive officer, said in an accompanying statement. “The F-35 will provide exceptional capability to the Hellenic Air Force, build interoperability between our allies and strengthen the combat effectiveness for all of NATO.”

The eastern Mediterranean country signed a letter of offer and acceptance through a U.S. foreign military sale that includes the option to buy another 20 aircraft. Altogether, the sales are estimated to be valued at roughly $8.6 billion, according to a January Defense Security Cooperation Agency notice clearing the NATO nation to procure the fifth-generation jets.

Greece had been in the bidding for F-35 platforms for years to replace its increasingly ancient fleet, but officials held off on the sale out of concern it would strain tensions between the U.S. and Turkey given an ongoing standoff between Athens and Ankara.

The Biden administration in January then opted to unfreeze a $23 billion deal with Turkey to purchase 40 new F-16 Fighting Falcons and to modernize 79 additional aircraft from its existing fleet. In 2020, the U.S. and others in the military alliance silently banned exports of major arms to Turkey after the country purchased a Russian-made advanced radar system. The country was also expelled from the F-35 program because of its dealings with Moscow, as the U.S. saw the move as a threat to NATO stability.

Ultimately, DSCA said in a news release at the time that procuring fifth-generation fighters would “improve Greece’s ability to provide for the defense of its airspace, contribute to NATO missions to preserve regional security and defend NATO Allies, and maintain interoperability with U.S. and NATO forces.”

The Greek Air Force also operates F-16s, C-130 Hercules cargo planes and UH-60 Black Hawk helicopters. The first F-35 deliveries and support items will arrive starting in 2028, Greek national defense minister Niko Dendias said in a statement today, calling the deal part of the government’s major defense overhaul.

“With the acquisition of the F-35, a very important step in the ‘Agenda 2030,’ the Greek Air Force acquires the first fifth-generation aircraft -- as I said the best aircraft on the planet today -- and moves into a new era,” Dendias said, according to a translation accompanying the Lockheed news release. “We should see this big step in conjunction with everything else that is happening, so that the armed forces of our country can realize what we all believe. The most powerful presence of deterrence in our region, in the history of the Greek nation.”

By Shelley K. Mesch
July 25, 2024 at 2:39 PM

This Thursday INSIDER Daily Digest has news on the Air Force's Next Generation Air Dominance effort, the Navy's nuclear-armed, sea-launched cruise missile program, the Sentinel nuclear missile program and more.

We start off with a deep dive on the Air Force's Next Generation Air Dominance effort:

Are CCA and the sixth-generation fighter in a perfect marriage? Time will tell

Like families often do, the Next Generation Air Dominance family of systems has recently found itself in turmoil, with the Air Force now reconsidering its original vision for the sixth-generation fighter to ensure it is well-suited against evolving threats in the Indo-Pacific.

Coverage of the Navy's nuclear-armed, sea-launched cruise missile:

Navy aims to reach critical SLCM-N milestone by FY-26

The Navy has a goal of reaching milestone A for its nuclear-armed sea-launched missile program by fiscal year 2026, according to a recent contract announcement.

Northrop Grumman's CEO spoke on his company's quarterly earnings this morning:

Northrop CEO: Sentinel cost growth not related to company's performance

As the Sentinel nuclear missile program faces ballooning total costs, Northrop Grumman executives stressed during their second-quarter earnings call today that those increases won’t be realized yet for several years, past the current contract.

In April, Ursa Major signed a contract with the Naval Energetics Systems and Technologies Program in which it agreed to develop and hot-fire test a solid-rocket motor prototype for the service's Standard Missile program:

Ursa Major's Draper moved onto duration testing phase

Ursa Major's developmental liquid hypersonic engine known as "Draper" has made it out of the startup period and is currently in duration testing to ensure engine survivability through stress tests, a senior company official told Inside Defense.

The Senate Armed Services Committee, in the report accompanying its fiscal year 2025 defense policy bill, directs senior Pentagon acquisition officials to prepare a report on maximizing the use of rapid prototyping and non-traditional acquisition authorities to speed the Guam missile defense project as well as action to improve integration efforts:

Guam air and missile defense project suffering 'apparent lack of progress,' lawmakers say

Pentagon efforts to rapidly field a 360-degree, air-and-missile defense system to Guam are hampered by an "apparent lack of progress . . . to effectively integrate" nearly two-dozen components that comprise a hybrid architecture of new and existing technologies, according to lawmakers who want a more nimble acquisition effort for the project.

Some counter-drone news:

DOD officials: Counter UAS swarm demonstration last month presented necessary 'challenge'

A demonstration conducted by the Pentagon's Joint Counter-small Unmanned Aircraft Systems Office that focused on defeating large swarms of up to 50 drones was challenging but necessary in order to keep pace with global threats, officials from the office and the Army said this week.

News on the next-generation AWACS aircraft:

Air Force, Boeing reach 'affordable cost agreement' on E-7A Wedgetail

While still waiting to finalize the contract for the E-7A Wedgetail, the Air Force and Boeing have agreed on an "affordable price" for the warning and control contract, service officials said this week.

By Nickolai Sukharev
July 25, 2024 at 2:07 PM

The Army is asking industry partners for feedback to design a tactical vehicle integration lab as part of a decade-long effort to transform current combat systems, according to a public notice.

Estimated to cost between $25 and $100 million, the Manned/Unmanned Tactical Vehicle Lab will include “engineering-design space to enable the integration of technology required for the transformation of current combat systems to manned-unmanned systems to meet the Army’s strategic program delivery requirements,” the Wednesday announcement reads.

Planned for the Ground Vehicle Systems Center at the Detroit Arsenal in Warren, MI, the newly built facility will be 44,760 square feet and must be consistent with Defense Department Minimum Antiterrorism for Buildings requirements.

Issued by the Army Engineering Corps for small businesses, the “contract duration is estimated at 750 calendar days,” the statement reads.

The Detroit Arsenal serves as the headquarters of the Army Tank-automotive and Armaments Command, which is subordinate to the Army’s Materiel Command and oversees the services’ combat vehicle units.

The Army is currently developing a new generation of ground combat vehicles, including the Robotic Combat Vehicle and the XM30, which will replace the Bradley Fighting Vehicle.

Recently fielded projects include the Armored Multi-Purpose Vehicle, a replacement for the M113 armored personnel carrier and the M10 Booker, a tracked vehicle designed to slot between the Bradley and Abrams main battle tank.

Formerly known as the Detroit Arsenal Tank Plant, the facility produced tanks during World War II and the Cold War.