The Insider

February 13, 2018 at 3:46 PM | Ashley Tressel

The Army's fiscal year 2019 budget request seeks a jump in funding for the Joint Light Tactical Vehicle and a slight increase for the humvee. New this year, the service is seeking to procure a portion of humvee ambulances with Overseas Contingency Operations dollars.

Procurement of 3,390 JLTVs accounts for $1.3 billion, in base funding only, about a $500 million increase from last year. Oshkosh Defense, the JLTV's manufacturer, will be awarded the FY-19 order in December, with the first delivery scheduled for October 2019. The Army's objective is to procure a total of 49,099 trucks of various configurations with increased protection and performance and maximum commonality over the current humvee fleet.

Additionally, the Army is requesting $71 million for 248 ambulance variants for the active Army, Army National Guard and Army Reserve. Of those, 73 are funded in the OCO account for $20.8 million.

"Recent natural disasters highlight the need for reliable and capable utility vehicles to enable the Guard and Reserve to mobilize rapidly to respond immediately to state and national needs," the budget justification document states.

The service intends to replace up to 3,688 humvee ambulances. 

February 13, 2018 at 2:30 PM | John Liang

The FY-19 defense budget continues to dominate this Tuesday INSIDER Daily Digest.

Inside Defense compares the Pentagon's base budget forecast with the White House Office of Management and Budget's numbers:

New Pentagon budget backed by planned increases of more than $1 trillion over the decade

The Trump administration is backing the new National Defense Strategy with a 10-year, $7.2 trillion spending forecast -- a boost of more than $1 trillion compared to the most recent Obama plan -- including a near-term drive to propel the Pentagon's annual budget above $700 billion beginning in FY-20, according to the Office of Management and Budget.

Overseas Contingency Operations will be phased out over the next two years:

Pentagon sparks OCO whiplash as it seesaws from $89B request to planned phase-out

Before Congress finalized a two-year spending deal, the Defense Department planned to finance a multibillion-dollar budget buildup through its controversial Overseas Contingency Operations account. Now, it is reversing course and projects it will begin phasing out OCO in FY-20.

The Air Force wants to make sure it properly manages its Joint Strike Fighter production pipeline:

Air Force says request for 48 F-35s supports 'manageable ramp' in production

Air Force officials say the service is still targeting an annual F-35 production rate of 60 aircraft, but in the near term, the focus is on maintaining a "manageable ramp" in order to avoid undue strain on its production and logistics infrastructure.

The missile defense budget stands to get a hefty bump in FY-19:

MDA seeks $9.9 billion in FY-19, boost of more than 20 percent above prior forecast

The Missile Defense Agency is seeking $9.9 billion in fiscal year 2019 -- an increase of more than 20 percent compared to the Trump administration's earlier plans -- signaling concern by policymakers about the growing threat and increasing complexity of long-range missiles from adversaries such as North Korea and a potential new class of ultra-fast, maneuvering weapons from China and Russia.

Related missile defense news:

Despite test failure, MDA moves forward with SM-3 Block IIA plans

The Missile Defense Agency is moving forward with plans to purchase more Standard Missile 3 Block IIA guided interceptors in fiscal year 2019 and deploy the weapon by the end of this calendar year, despite the system failing to intercept a ballistic missile target during a recent flight test.

Navy asks Congress for OK to lock in $2 billion, five-year deal for Raytheon SM-6 interceptors

The Navy is seeking permission from Congress to negotiate a $2 billion, five-year contract to buy Standard Missile-6 interceptors, a deal the service says would avoid $331 million compared to annual purchases. This would be one of two multiyear procurement deals the Pentagon is seeking with Raytheon for Standard Missiles in fiscal year 2019.

The Army wants more money to improve combat vehicle programs:

Army seeks to significantly boost vehicle upgrades in FY-19 budget

The Army's fiscal year 2019 budget request would bring a surge in funding for improvements to the Abrams, Bradley and Stryker programs, part of the service's move to modernize its brigade combat teams.

Don't expect another round of base realignments and closures anytime soon:

Pentagon abandons BRAC, seeks to trim $6B elsewhere

The Pentagon, which will no longer lobby Congress for another round of base realignments and closures, intends to find $6 billion in efficiencies in fiscal year 2019 by establishing a new management task force composed of senior officials and executing a variety of unnamed initiatives.

A look at the Navy's shipbuilding plans:

Navy plan to reach 355-ship fleet would take more than 30 years

The Navy aims to build a 355-ship fleet by the 2050s, according to the new 30-year shipbuilding plan sent to Congress Monday.

Document: Navy's 30-year shipbuilding plan for FY-19

As Inside Defense reported last week, the Air Force will not fund the E-8C Joint Surveillance Target Attack Radar System recapitalization in the Defense Department's fiscal year 2019 request, a stark change of course from its original plan:

Air Force points to MQ-9, future sensor investments to replace JSTARS recapitalization

The Air Force is pursuing new battle management and command-and-control efforts after abandoning the E-8C Joint Surveillance Target Attack Radar System recapitalization program in its fiscal year 2019 budget request.

February 13, 2018 at 1:16 PM | Justin Katz

General Atomics Aeronautical Systems announced yesterday Boeing Autonomous Systems will join its MQ-25 Stingray team.

The announcement comes less than two months after Boeing unveiled a first look at its own MQ-25 Stingray offer, Inside the Navy reported.

Boeing becomes the seventh company to join General Atomics' MQ-25 team, which already includes L3 Technologies, BAE Systems and Rockwell Collins among others.

The MQ-25 competition is limited to Boeing, General Atomics, Lockheed Martin and Northrop Grumman. Northrop Grumman said in October that it would not offer a bid. The Navy anticipates an award later this year. Boeing's Phantom Works division intends to bid on the MQ-25 contract separately.

The MQ-25 Stingray unmanned tanker will provide an aerial refueling capability and limited intelligence, reconnaissance and surveillance.

February 13, 2018 at 11:56 AM | Marjorie Censer

Management consulting firm Deep Water Point said today it has hired retired Army Maj. Gen. Dennis Moran as a Defense Department subject matter expert.

"Moran will join a cadre of experts focused on addressing the priorities of the DOD market," the company said. "He will play a critical role in helping Deep Water Point’s clients better understand the challenges, opportunities and evolving priorities within the current defense environment."

Moran joins from Harris, where he was vice president of DOD business development. He previously spent 31 years in the Army.

February 13, 2018 at 10:47 AM | Jason Sherman

The White House Office and Management and Budget has transmitted a statutorily required report to Congress outlining $54 billion in cuts to defense spending in fiscal year 2019 required by the Budget Control Act -- reductions, however, that are no longer needed in light of the recent two-year budget deal which lifted caps on discretionary spending in FY-18 and FY-19.

"The legislation sets new discretionary spending limits for 2018 and 2019 and directs that the reductions to the discretionary spending limits described in this report not be applied for 2019," OMB Director Mick Mulvaney wrote in a Feb. 12 letter conveying the report to lawmakers.

February 12, 2018 at 5:31 PM | Marjorie Censer

Northrop Grumman said today the European Commission has notified it that it has approved the contractor's planned acquisition of Orbital ATK.

"Northrop Grumman continues to support the U.S. Federal Trade Commission's review of the acquisition," the company added.

In December, Northrop Grumman said it had "received a request for additional information" from the FTC as it reviewed the acquisition.

February 12, 2018 at 4:18 PM | Lee Hudson

The Navy and Marine Corps are seeking $324 million in the fiscal year 2019 budget to support the European Deterrence Initiative, according to an official.

Rear Adm. Brian Luther, deputy assistant secretary of the Navy for budget, told reporters today the money will be used for several Navy and Marine Corps projects. For instance, the Navy plans to recapitalize its integrated undersea surveillance system for anti-submarine warfare and prepositioning.

The Navy would set aside $215 million for four military construction projects. These include stationing the P-8A Poseidon maritime patrol aircraft at Naval Air Station Sigonella, Italy; building an enhanced seaport at Naval Station Rota, Spain; establishing multimodal capabilities at Naval Support Activity Souda Bay, Greece; and making P-8 improvements at Royal Air Force Lossiemouth, Scotland.

The Marine Corps plans to spend $68 million on adding and replacing inventory at the service's prepositioning program in Norway, equipping a rotational Marine Air-Ground Task Force and funding multinational exercises.

In 2014, the Obama administration established the European Reassurance Initiative to support NATO in the face of an increased Russian threat. The Trump administration has changed the name.

February 12, 2018 at 2:35 PM | John Liang

We start off this Monday INSIDER Daily Digest with major budget news from OSD and the services, plus a big announcement from General Dynamics.

In an unusual budget rollout, the Defense Department published documents detailing a budget request that the White House Office of Management and Budget immediately superseded with a letter to congressional leaders explaining the Pentagon's total FY-19 request will not be complete until the military prepares justification materials for an additional $20 billion in planned spending:

Pentagon seeks $686B in FY-19; $617B in base budget with big modernization boost

The Trump administration today unveiled the outlines of a $686 billion budget for the Defense Department in fiscal year 2019 that includes a $20 billion placeholder for military spending increases set as part of the recent two-year budget deal.

DOD's FY-19 request for science and technology reflects a 4 percent increase above the FY-18 request of $13.2 billion:

Pentagon budget request seeks modest boost for S&T programs

The Pentagon's fiscal year 2019 budget request includes $13.7 billion for science and technology, a modest bump above last year's request, to continue investments in areas like artificial intelligence, autonomy and hypersonics.

The services also rolled out their budgets:

Air Force budget request would buy 48 F-35As and boost major research and development efforts

The Air Force's $156.3 billion fiscal year 2019 budget proposal calls for 48 new F-35 Joint Strike Fighters, 15 KC-46 aerial refuelers and 36,000 Joint Direct Attack Munitions.

Army budget request rises to $182.1 billion in FY-19

The Trump administration's fiscal year 2019 budget request seeks $182.1 billion for the Army -- $148.4 billion in the base budget and $33.7 billion in the Overseas Contingency Operations account.

Navy requests 14 new ships, $194.1 billion in fiscal year 2019 budget

The Navy is requesting $179.1 billion in the fiscal year 2019 base budget and $15 billion in wartime funding that would, in total, fund the construction of 14 new ships.

In a major defense business news announcement, General Dynamics is buying CSRA:

General Dynamics to acquire CSRA in $9.6 billion deal

General Dynamics announced today it plans to acquire CSRA in a deal valued at $9.6 billion.

The Army is interested in alternative power, at least semi-autonomous capability and enhanced lethality and mobility:

Murray: 'We can't wait 20 years to develop' NGCV

Lt. Gen. Mike Murray, the Army deputy chief of staff (G-8), told the Senate Armed Services airland subcommittee in a hearing Feb. 7 the service is considering "all options" for the Next Generation Combat Vehicle's design.

Last December, Pentagon acquisition chief Ellen Lord signed an acquisition decision memorandum approving full production for the SM-3 Block IB program:

DOD clears Standard Missile-3 Block IB for full production, MDA seeking MYP in FY-19

The Pentagon's acquisition executive has approved the Standard Missile-3 Block IB for full production, paving the way for the Missile Defense Agency to advance its first proposal to negotiate a multiyear procurement contract.

February 12, 2018 at 1:50 PM | Marjorie Censer

President Trump today said the military is getting a significant budget boost -- but that he expects the Pentagon to be able to buy more for less.

Speaking at a meeting with state and local officials about his infrastructure initiative, Trump said the new budget takes care "of the military like it's never been taken care of before."

"In fact, Gen. [Jim] Mattis called me, and he goes, 'Wow, I can't believe I got everything we wanted.' I said, 'That's right, but we want no excuses. We want you to buy twice, OK, twice what you thought for half the price,'" Trump said, according to a transcript of the meeting.

"So maybe we're going to get involved a little bit in the buying," he continued. "We want to get twice as many planes for half the price. And believe me, we can do a lot, because the procurement process is very outdated, to put it nicely."

During the same remarks, Trump also said his administration is working to create a "brand new nuclear force."

"Frankly, we have to do it because others are doing it. If they stop, we'll stop, but they're not stopping," he said. "So if they're not going to stop, we're going to be so far ahead of everybody else in nuclear like you've never seen before. And I hope they stop. And if they do, we'll stop in two minutes. And, frankly, I would like to get rid of a lot of them. And if they want to do that, we'll go along with them. We won't lead the way; we'll go along with them.

"But we will have a nuclear force that will be absolutely modernized and brand new, and hopefully we'll never have to use it, and hopefully we can reduce it in the years ahead," Trump continued. "And that depends really on what other people are going to be doing. But we will always be number one in that category, certainly as long as I'm president. We're going to be far, far in excess of anybody else."

February 12, 2018 at 11:54 AM | John Liang

Some must-reads from this week's edition of Inside the Army:

1. The White House Office of Management and Budget will submit the fiscal year 2019 budget request Feb. 12 and is updating it to reflect the two-year, $300 billion spending agreement Congress reached early Feb. 9, according to a senior OMB official.

Full story: OMB working new FY-19 toplines after Congress passes spending deal

2. During a Feb. 7 hearing of the Senate Armed Services airland subcommittee, a quartet of Army senior leaders issued a familiar call for funding increases and budget stability, while seeking greater flexibility to pursue the service's modernization priorities.

Full story: Generals address Army's pursuit of modernization priorities, seek further reforms

3. Three Army units in Europe are receiving a set of interim electronic warfare capabilities designed to counter near-peer adversaries, with further updates to come next year.

Full story: Army delivering electronic warfare systems to units in Europe

4. Lt. Gen. Mike Murray, the Army deputy chief of staff (G-8), told the Senate Armed Services airland subcommittee in a hearing Feb. 7 the service is considering "all options" for the Next Generation Combat Vehicle's design.

Full story: Murray: 'We can't wait 20 years to develop' NGCV

February 12, 2018 at 11:34 AM | Lee Hudson

Some must-reads from this week's issue of Inside the Navy:

1. The Pentagon's acquisition executive has approved the Standard Missile-3 Block IB for full production, paving the way for the Missile Defense Agency to advance its first proposal to negotiate a multiyear procurement contract.

Full Story: DOD clears SM-3 Block IB for full production, MDA seeking MYP in FY-19

2. Budget uncertainty may stall a contract award this spring to construct an F-35B vertical lift-fan test facility at Marine Corps Air Station Cherry Point, NC, to support depot-level maintenance.

Full Story: Budget uncertainty may hinder F-35B depot-level maintenance

3. President Trump came into office a year ago promising to grow the Navy to 350 ships, a vow cheered by shipbuilders and congressional supporters.

Full Story: A year in, Trump administration yet to lay budget groundwork for 350-ship Navy

4. The Navy is "not declaring victory" over the problem of pilots suffering physiological episodes in the T-45C Goshawk trainer or the F/A-18 Hornet and Super Hornet although rates of occurrence have greatly decreased in the trainers.

Full Story: Navy ‘not declaring victory’ in on physiological episodes

February 12, 2018 at 5:00 AM | Tony Bertuca

The Pentagon will submit its fiscal year 2019 budget Monday, and the service vice chiefs are scheduled to testify on Capitol Hill later in the week on military readiness. Meanwhile, Defense Secretary Jim Mattis is traveling to Italy for a NATO ministerial.


The Pentagon is expected to formally present its FY-19 budget request. Watch Inside Defense for in-depth coverage.

Air Force Under Secretary Matt Donovan will discuss the service's FY-19 budget request at an Air Force Association breakfast in Washington.

The Brookings Institution holds a panel discussion on the Nuclear Posture Review.

The Center for Strategic and International Studies hosts an event on the geostrategic challenges in the Eastern Mediterranean.

CSIS also holds an event on oversight and accountability in the U.S. security sector.


The Senate Armed Services Committee holds a hearing on DOD's role in protecting democratic elections.

The executive deputy director of the Defense Information Systems Agency speaks at the Federal Networks Conference in Tysons Corner, VA.


The House Armed Services readiness subcommittee holds a hearing on Air Force readiness.

The House Armed Services Committee holds a hearing with the chief of U.S. Pacific Command on the security challenges in the Indo-Pacific region.

The Senate Armed Services Committee holds a hearing with the vice chiefs on the state of U.S. military readiness.

The Senate Armed Services personnel subcommittee holds a hearing on military and civilian personnel programs and family readiness.

Senior DOD officials are scheduled to speak at the Armed Forces Communications and Electronics Association's annual Air, Space and Cyber IT Day in Falls Church, VA.


The House Armed Services Committee holds a hearing with foreign policy experts on strategic competition with China.

The House Armed Services emerging threats and capabilities subcommittee holds a hearing on U.S. Special Operations Command's FY-19 budget request.

The Senate Armed Services Committee holds a hearing with the chiefs of U.S. Northern and Southern commands.


Air Force Secretary Heather Wilson will discuss air and space power at an Air Force Association breakfast in Washington.

The House Financial Services monetary policy and trade subcommittee holds a hearing on the Committee on Foreign Investment in the United States.

February 9, 2018 at 4:01 PM | Justin Doubleday

Defense Secretary Jim Mattis will head to Europe for a slew of meetings with NATO allies, as well as officials from U.S. European and Africa commands, respectively.

On Sunday, Mattis leaves for Rome, where he will meet with Italian Minister of Defense Roberta Pinotti and other senior officials Feb. 12-13, the Pentagon said today. The Defense Department plans to roll out its fiscal year 2019 budget request on Monday, Mattis' first day in Rome.

He will then head to Brussels to participate in the first NATO defense ministerial of the year Feb. 14-15, where "he will engage with allies to discuss how to strengthen the alliance and forge new partnerships, ensure that the alliance is fit for its time, and to deter or defeat threats to the alliance," according to the Pentagon's statement.

Next up is Stuttgart, Germany, where Mattis will visit the respective headquarters of U.S. European and Africa commands Feb. 15-16. Finally, Mattis finishes the trip in Munich Feb. 16-17 for the 54th Munich Security Conference. The event will involve a discussion of "current crises and future challenges in European security policy," according to the Pentagon.

February 9, 2018 at 1:56 PM | John Liang

This Friday INSIDER Daily Digest highlights the effect of tax legislation on defense contractors, a new DOD cloud services contract plus a slew of Air Force news.

A look at the effect of tax legislation on defense contractors:

Defense contracting executives insist companies will be able to retain boost from tax legislation

The new tax legislation passed late last year has been hailed by many business executives, who argue the changes will help them invest in their workers and new technology.

An Amazon Web Services partner has been awarded a DOD cloud services contract:

DOD issues $950 million cloud services contract to Amazon reseller

The Defense Department has awarded a contract worth up to $950 million for cloud services to an Amazon Web Services partner, but says the award is unrelated to a high-level steering group's plans for accelerating cloud adoption across the department.

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Defense Secretary Jim Mattis briefed reporters yesterday on the potential military budget boost:

Mattis pledges to 'wisely' spend potential budget boost as Hill debate continues

Defense Secretary Jim Mattis, citing an ongoing Pentagon audit, pledged today to "wisely" spend the $165 billion in additional defense funding Congress is poised to grant the Defense Department in fiscal years 2018 and 2019.

The Air Force wing commanders who oversee command-and-control systems are concerned current equipment and training could become irrelevant by 2040:

C2 stakeholders craft recommendations to keep systems relevant

Air Force officials plan to recommend a slate of tactical and training changes by Feb. 11, following a study on the future of command-and-control assets at Nellis Air Force Base, NV.

The Defense Department recently sent a report to Congress outlines DOD's efforts to upgrade training ranges across the services:

DOD investing in range improvements to support F-35 IOT&E

The Defense Department is in the midst of several test and training range upgrades in preparation for F-35 initial operational test and evaluation as well as to support the fifth-generation aircraft's long-term range needs.

Document: DOD's national test and training range improvements strategic plan

The Pentagon's latest OT&E report looks at the Small Diameter Bomb II and Distributed Common Ground System programs:

Air Force to field SDB II software upgrades to improve accuracy

As Raytheon's Small Diameter Bomb II moves through its test program, the new weapon performed well against moving targets but still had problems hitting static and maritime targets, the Pentagon's director of operational test and evaluation said in his annual report published last month.

DCGS program office says fixes improving intel processing capabilities

Air Force Distributed Common Ground System officials say the director of operational test and evaluation's latest findings on the program are outdated because he did not account for recent software updates and new system baselines.

Check out Inside Defense's full DOT&E report coverage →

An Air Force Space Defense Task Force over the last year has been working closely with the teams in charge of two key efforts: Enterprise Space Battle Management Command and Control and Enterprise Ground Services:

SMC task force aims to improve, inform enterprise software development

As the Space and Missile Systems Center works to establish a more enterprise-focused approach to operational command and control, a Space Defense Task Force is working to incorporate new software development and delivery concepts and to ensure that those deliveries are cybersecure.

The Joint Air-to-Surface Standoff Missile is now fully operational on the F-15E, according to Lockheed Martin:

JASSM-ER declared operational on F-15E with new flight software

Lockheed Martin said this week the extended-range variant of its Joint Air-to-Surface Standoff Missile reached full operational capability on the F-15E, and the company is looking to finalize a Lot 16 production contract this year.

The Air Force awarded initial Data Link Enterprise contracts to nine companies in early January and expects to award contracts for a technology demonstration by the third quarter of this year:

Air Force creates marketplace to boost data link research

The Air Force is establishing a marketplace to support research and development across its data link enterprise.