The Insider

By Marjorie Censer
March 24, 2020 at 12:25 PM

Parsons said today it has named J.R. Riordan senior vice president of business development for its space and geospatial solutions market.

Riordan previously worked for the Senate Armed Services Committee, where he led the strategic forces staff for nuclear, missile defense and space operations issues, according to Parsons. He retired from the Air Force in 2011 after a 23-year career.

"Riordan will lead the account management, business development and customer engagement of the company's space portfolio for the Department of Defense and Intelligence Community," Parsons said.

By Marjorie Censer
March 24, 2020 at 12:22 PM

L3Harris Technologies said today it has agreed to sell its EOTech business to American Holoptics, an affiliate of Koucar Management.

"With annual revenues of approximately $60 million, EOTech manufactures holographic sighting systems, magnified field optics and accessories for military, law enforcement and commercial markets around the world," L3Harris said.

The company said the deal is expected to close in mid-2020.

This marks just the latest divestiture from L3Harris. Earlier this year, the company agreed to sell its security detection and automation business to Leidos and its applied kilovolts and analytical instrumentation business to Adaptas Solutions.

By Tony Bertuca
March 24, 2020 at 12:07 PM

Defense Secretary Mark Esper and Chairman of the Joint Chiefs of Staff Gen. Mark Milley said today the Pentagon expects the coronavirus outbreak to last "at least" a few months, while President Trump is signaling he wants to soon roll back economically costly social distancing measures.

"I think we need to plan for this to be a few months long, at least," Esper said during a Pentagon "town hall" panel.

Esper said that eight to 10 weeks might be indicative of how long the outbreak will last, given the length of time it has taken China and South Korea to "flatten the curve" of COVID-19 infections.

"You're looking at probably at least that long," he said, adding that DOD is still planning to "be in it for the long haul."

Milley agreed that it could take "eight to 10 weeks, call it three months."

"Some of that depends on what we do as a nation to mitigate it, to flatten that curve," Milley said.

Trump, meanwhile, is showing signs he wants to lift current workforce restrictions and re-open the U.S. economy."Our people want to return to work," he tweeted today. "They will practice Social Distancing and all else, and Seniors will be watched over protectively & lovingly. We can do two things together. THE CURE CANNOT BE WORSE (by far) THAN THE PROBLEM! Congress MUST ACT NOW. We will come back strong!"

By Justin Katz
March 24, 2020 at 10:28 AM

The Navy will hold an upcoming industry day via teleconference rather than at a Washington venue in response to escalating public concerns about the coronavirus pandemic, according to a service notice.

The April 8 event is focused on a cable ship replacement program, T-ARC(X), and a new general-purpose oceanographic survey vessel, T-AGS(X).

"Event will be teleconference only. Details will be provided to registered participants. There will not be an in-person brief due to current public health concerns," according to the March 23 notice.

Regarding the oceanographic survey vessel, the Navy plans to focus discussions with industry on four areas: hull forms, autonomous underwater vehicles, unmanned underwater vehicles manufacturing, launch and retrieval, and sensors/underwater surveillance.

"The primary objectives of the T-AGS(X) panel is for [the program office] to inform industry of the anticipated acquisition schedule for its new class of oceanographic survey vessels and for industry to inform the Navy of potential alternatives and technological advancements while requirements are being developed and shaped," according to the notice.

The second half of the event will focus on the acquisition schedule, contract and technical requirements for the T-ARC(X), a program to replace the Navy's sole cable ship, USNS Zeus (T-ARC-7.)

"The new T-ARC(X) ship will be outfitted with modern cable handling equipment, including plows and [remotely operated vehicles]. The ship will be equipped with a variety of hull-mounted sonar systems to support both its primary and secondary missions. T-ARC(X) will also incorporate a moonpool," according to the notice.

By Marjorie Censer
March 23, 2020 at 9:03 PM

Joint Light Tactical Vehicle manufacturer Oshkosh said today that while it is suspending access equipment production in North America next week, its defense segment is still working.

"While COVID-19 is also impacting our Defense, Fire & Emergency and Commercial segments, we continue to use [Centers for Disease Control and Prevention] recommended safety procedures across the Company and production continues in those segments at this time," Wilson Jones, Oshkosh's chief executive, said in a statement.

Oshkosh said the company expects coronavirus to affect its financial results, "but the magnitude and timing of the impact is uncertain."

"In addition, production at any of the Company's facilities may be further impacted as a result of possible government, market or Company actions due to COVID-19," the company continued. "For these reasons, Oshkosh is withdrawing its fiscal 2020 financial expectations. The Company plans to provide an update for the remainder of fiscal 2020 when it announces fiscal 2020 second quarter results."

By Tony Bertuca
March 23, 2020 at 8:47 PM

President Trump intends to nominate John Whitley to be director of the Pentagon's cost assessment and program evaluation office, according to a White House announcement.

Whitley currently serves as assistant secretary of the Army for financial management and comptroller.

Whitley, who joined the Trump administration as Army comptroller in September 2018, has been performing the duties of CAPE director since the post was vacated by Bob Daigle last May.

He was previously a senior fellow at the Institute for Defense Analyses and the Center for Naval Analysis.

By Tony Bertuca
March 23, 2020 at 4:50 PM

Defense Secretary Mark Esper said two military field hospitals will be sent to Seattle and New York City this week to take pressure off medical facilities responding to the coronavirus outbreak.

"Beyond that, once that's confirmed, we will look at sending to other places," he told reporters at the Pentagon.

The locations of the hospitals are being determined by the Federal Emergency Management Agency.

"I've spoken with seven, eight, nine, 10 governors so far," Esper said. "Each one of them has had requests for field hospitals."

Esper said the Defense Department "clearly can't meet everybody's needs with what we have in our inventory," so it is relying on FEMA to prioritize its response.

Esper said he anticipates field hospitals being deployed to areas hit by the COVID-19 pandemic that need temporary additional bed space, while local structures are converted to hospitals.

"We can come in for a short period of time, for a few weeks, to provide that capacity until they get either gyms converted, hotels converted, college dorms converted," he said. "Because what we're talking about is the need for thousands of beds. We could provide, in a field hospital, 248. And we only have so many field hospitals."

He noted that the Army Corps of Engineers is assisting New York with this task now.

"So, I see us playing this role where we're the gap-filler for a period of weeks," he said. "We can then pull out and go to the next site and cover, again, that gap for the next city or locality that is ramping up."

Meanwhile, he said, the hospital ship Mercy is being deployed to Los Angeles and the Comfort being sent to New York City to take in non-COVID-19 patients.

By Mallory Shelbourne
March 23, 2020 at 4:16 PM

The Marine Corps' first F-35C Joint Strike Fighter squadron has achieved its safe-for-flight operations certification, the service announced today.

According to a press release, Marine Fighter Attack Squadron 314, which is based out of Marine Corps Air Station Miramar, achieved the certification on March 20.

"Today's achievement marks a significant milestone and the beginning of a new chapter in our storied legacy," VMFA-314 commanding officer Lt. Col. Cedar Hinton said in the release.

"The F-35C advances our capability well into the next generation of fighter-attack aircraft and will keep our squadron, and our service, relevant for decades to come," he added.

The 3rd Marine Aircraft Wing, which Marine Fighter Attack Squadron 314 is part of, received its first F-35C in January 2020.

"The [safe-for-flight operations certification] process ensures the squadron is manned with qualified personnel to implement maintenance and safety programs in support of fleet operations," the press release reads. "All transitioning squadrons are required to complete this certification prior to independently conducting flight operations."

By Courtney Albon
March 23, 2020 at 3:43 PM

Air Force acquisition executive Will Roper said today he's been "amazed at how little disruption" the COVID-19 outbreak has caused to Air Force and Space Force programs, but said the service continues to monitor the effects of the pandemic.

"As we complete our first week of response, our teams navigated potential work stoppages, changing local and state directives, halted supply chains, and gearing up to support any national Defense Production Act requirements," Roper said in a statement. "Ongoing dialogues -- including those with other departments and industry leaders -- are focused on further empowering the field, providing additional resources, and managing cost and schedule impacts flexibly."

The statement comes as Boeing announced it will halt all production in the Puget Sound area for two weeks -- a pause that will temporarily suspend KC-46 airborne refueling tanker production. A Boeing spokesman said the production hold won't impact March deliveries, as the company has already delivered the two tankers it had planned for the month. Work to improve the tanker's troubled remote vision system will continue off-site, the spokesman confirmed.

Roper noted in his statement that the service is working to maintain a long-term focus even as near-term impacts of the coronavirus loom.

"There were so many examples of innovation this past week -- it makes me exceptionally proud to serve on this team and exceptionally hopeful we will slalom through the obstacles next week and weeks after," he said. "I have the utmost confidence that our Air Force and Space Force acquisition team will get through this unprecedented time and be a stronger department for it."

By John Liang
March 23, 2020 at 2:22 PM

This Monday INSIDER Daily Digest has news on DOD efforts to keep the defense industrial base humming amid the COVID-19 pandemic, the Marine Corps' 2030 force design effort and more.

We start off with various departmental efforts to ensure the defense industrial base is able to continue supplying the Pentagon with needed weapons and equipment:

Defense industrial base deemed 'critical' amid COVID-19 shutdowns

Pentagon acquisition chief Ellen Lord sent a memo to defense contractors today laying out which ones are deemed "critical" by the U.S. government and therefore expected to maintain their normal work schedules, despite the national emergency over COVID-19.

Document: Lord memo on 'critical' defense industrial base


New Pentagon memo increases progress payment rates in response to COVID-19 outbreak

In a memo signed late last week, the Defense Department says it is immediately increasing progress payment rates to respond to the coronavirus outbreak.

Document: DOD memo on progress payment rates


Geurts directs Navy contracting officers to increase cash flow in response to COVID-19

The Navy's acquisition executive is ordering contracting officers to take steps to increase cash flow to contractors and their supply chains in response to the coronavirus pandemic, according to a memo obtained by Inside Defense.

Document: Geurts memo on withholds, retentions amid COVID-19

The Marine Corps has issued details of its 2030 force design effort:

Marine Corps trimming F-35 squadron numbers, cutting tank battalions in 2030 force design effort

As it gears up to fight China in a period of great power competition, the Marine Corps will trim the size of its F-35 Joint Strike Fighter squadrons and cut all tank battalions in the next 10 years.

The Defense Department wants the military services to be able to use operations and maintenance funding for the "rapid creation, testing, fielding, and operation of cyber capabilities that would be developed and used within the one-year appropriation period":

Pentagon asks for legislation allowing flexible funding of cyber developments

The Pentagon is asking Congress to adopt a legislative proposal allowing Defense Department organizations to use operations and maintenance funding to develop "cyber-operations peculiar" capabilities.

By Jaspreet Gill
March 23, 2020 at 1:49 PM

The Army's Program Executive Office Soldier is hosting an industry day for the Family of Weapon Sights-Individual system next month.

Due to the COVID-19 pandemic, the industry day will be held virtually and consist of 30-minute teleconferences with vendors on April 14 and 15, according to an Army notice posted today.

The service will inform industry on the FWS-I acquisition strategy and is asking industry to help develop a contracting strategy.

According to the notice, the FWS-I is a “weapon-mounted long-range infrared sensor that provides imagery including a reticle bored sighted to the host weapon [i.e. the M4 Carbine or M249 Squad Automatic Weapon] that can operate in battlefield conditions.”

The FWS-I will provide rapid targeting acquisition when integrated into the Enhanced Night Vision Goggle-Binocular and the Integrated Visual Augmentation System, both next-generation Army goggles.

The Army expects to release a request for proposals for the FWS-I in the fourth quarter of fiscal year 2020 and award a contract in the third quarter of FY-21.

Industry should respond by March 27, according to the notice.

By Marjorie Censer
March 23, 2020 at 1:37 PM

In a new memo, a top Pentagon acquisition official instructs the services and other defense organizations to offer contractors the same telework flexibilities extended to Pentagon servicemembers and civilians.

The coronavirus "requires our contracting officers to consider unprecedented flexibilities to ensure the mission is supported while supporting the whole-of-America effort to bend the curve and stem the spread of the pandemic," reads the March 20 memo, signed by Kim Herrington, acting principal director of defense pricing and contracting.

"A significant part of our mission readiness is provided by our contractor partners who routinely work alongside service members and Government civilians at Department of Defense (DOD) installations and facilities," the document adds. "To this end, we are asking that the same maximum telework flexibilities extended to DOD service members and civilians also be made available to contractors when contract services can be delivered, without mission degradation, while off-site."

Herrington writes that allowing "our contractors flexibility in their place of performance during this COVID-19 crisis is a reasonable step."

By Marjorie Censer
March 23, 2020 at 1:10 PM

Boeing's planned two-week suspension of its Puget Sound-area production operations will include P-8 and KC-46A work, a spokesman confirmed today.

Boeing announced today it will temporarily halt production operations at its Puget Sound-area facilities "in light of the state of emergency in Washington state and the company's continuous assessment of the accelerating spread of the coronavirus in the region."

The company said it will begin cutting production today and will suspend it Wednesday for 14 days.

The spokesman said Boeing is "actively engaged with our defense customers to minimize any impacts on their missions."

"Certain non-production work for all commercial derivative aircraft programs, including for the KC-46 remote vision system enhancements, will continue being done by employees working remotely," he added.

Boeing said during the closure it will "be conducting additional deep cleaning activities at impacted sites and establishing rigorous criteria for return to work."

"Puget Sound area-based employees who can work from home will continue to do so," the company added. "Those who cannot work remotely will receive paid leave for the initial 10 working days of the suspension -- double the company policy -- which will provide coverage for the 14 calendar day suspension period."

Boeing said that once the suspension ends, it will take "an orderly approach" to restarting production.

"Boeing is working to minimize this suspension's impact on the company's ability to deliver and support its defense and space programs, and ensure the readiness of our defense customers to perform their vital missions," the company added. "Boeing will work closely with those customers in the coming days to develop plans that ensure customers are supported throughout this period. Critical distribution operations in support of airline, government, and maintenance, repair and overhaul (MRO) customers will continue."

Late last week, Boeing also announced its chief executive and chairman will forego all pay until the end of the year to help the company navigate the coronavirus. Additionally, the company suspended its dividend and extended its pause of share repurchasing, which began in April 2019. -- Additional reporting by Courtney Albon

By Marjorie Censer
March 23, 2020 at 12:40 PM

General Dynamics in a filing today added the coronavirus outbreak as a potential business risk.

The filing with the Securities and Exchange Commission follows a similar update filed by Northrop Grumman last week.

In the document, General Dynamics said the COVID-19 outbreak or any other outbreaks "could have a negative effect on our business, results of operations and financial condition."

"These effects could include disruptions or restrictions on our employees' ability to work effectively, as well as temporary closures of our facilities or the facilities of our customers or suppliers," the contractor continued. "This could affect our performance on our contracts. Resulting cost increases may not be fully recoverable or adequately covered by insurance, which could impact our profitability."

Additionally, General Dynamics noted that the health crisis has taken a toll on multiple countries' economies, "which could result in an economic downturn that may negatively affect demand for our products."

"The extent to which COVID-19 could impact our business, results of operations and financial condition is highly uncertain and will depend on future developments," the company added. "Such developments may include the geographic spread and duration of the virus, the severity of the disease and the actions that may be taken by various governmental authorities and other third parties in response to the outbreak."

By Rick Weber
March 23, 2020 at 11:12 AM

The Defense Department is seeking public comment on extending reporting requirements for contractors under acquisition rules related to the purchasing of information technology services and products, including measures to protect against counterfeit components that could pose cybersecurity risks.

"Administrative contracting officers use this information in making decisions to approve or disapprove a contractor's purchase system," DOD says in a Federal Register notice issued today. "The disapproval of a contractor's purchasing system would necessitate Government consent to individual subcontracts and possibly prompt a financial withhold or other Government rights and remedies."

Comments are due within 60 days. The reporting requirement is being extended for three years, according to the notice.

The "information collection requirement" implements DOD Federal Acquisition Rule Part 244 which governs subcontracting policies and procedures, including purchases of IT products and managing supply-chain risks.

The rule requires contracting officers to "review the adequacy of the contractor's counterfeit electronic part detection and avoidance system" and "consider the need for a consent to subcontract requirement regarding supply chain risk," according to DFARS Part 244 Sections 303(b) and 201(a)(S-70), respectively.

The White House Office of Management and Budget "has approved this information collection requirement for use through May 31, 2020. DOD proposes that OMB extend its approval for an additional three years," according to the Federal Register notice.