The Insider

By John Liang
August 4, 2023 at 4:07 PM

This Friday INSIDER Daily Digest has news on Navy amphibious ships, the acting Marine Corps commandant's latest guidance and more.

Signaling the Navy's intent to procure at least three more of the Flight II San Antonio-class amphibious ships, a notice published this morning comes amidst a continuing debate over amphibious warship requirements and uncertainty as to how many more LPDs the sea service will procure:

Navy signals intent to procure at least three more LPDs

The Navy is planning to issue a solicitation to shipbuilder HII for long-lead-time materials and detail, design and construction of three amphibious warships -- LPD-33, LPD-34 and LPD-35, according to a presolicitation notice published Friday.

The Marine Corps' top uniformed officer issued his guidance to the service even though he hasn't been confirmed by the Senate yet:

Smith issues interim Marine Corps guidance as nomination hold drags on

Acting Commandant Gen. Eric Smith today published a Marine Corps force guidance letter affirming the service will continue on its Force Design 2030 trajectory and outlining accelerated modernization, naval integration and organic mobility as warfighting priorities.

Document: Smith's Marine Corps force guidance letter

The Marine Corps is strengthening its defenses against small drones:

Small drone defense at Marine Corps sites to grow

The Marine Corps is enhancing five small unmanned aerial system defense platforms fielded at undisclosed U.S. military sites, with plans to add the high-tech equipment at other installations.

Some CMMC news from our colleagues at Inside Cybersecurity:

DOD provides early look at assessment process for upcoming CMMC rulemaking

The Pentagon has outlined its expectations for the Cybersecurity Maturity Model Certification assessment process in a recent filing to the White House Office of Management and Budget's Office of Information and Regulatory Affairs that provides details on estimated costs for compliance for small business entities and other companies in the defense industrial base.

Pentagon offers sneak peak into CMMC requirements for level three in draft model update

The Defense Department is providing a long-awaited preview into its plans for level three of the Cybersecurity Maturity Model Certification program, in a draft update to an overview publication that describes "security requirements" as defined by the National Institute of Standards and Technology.

HII held its quarterly earnings call this week:

HII revenue grows on demand for aircraft carriers, submarines

Higher demand for design and construction of aircraft carriers and submarines in Newport News, VA, buoyed revenue growth at HII, according to second-quarter earnings reported Thursday.

More news from this week's Air Force Life Cycle Industry Day:

USAF is expecting to release Cloud One Next RFP by end of this month

DAYTON, OH -- The Air Force is expecting to release a request for proposals for the Cloud One Next program by the end of August and will award the contract next spring, according to a senior Air Force officer.

Read our full coverage from the event.

By Dan Schere
August 4, 2023 at 11:33 AM

Defense Secretary Lloyd Austin reiterated concerns about the blanket hold on more than 300 military nominees in the Senate Friday, during a sendoff for outgoing Army Chief of Staff Gen. James McConville.

McConville relinquished the position he has held for the past four years Friday during an official “relinquishment of responsibility” ceremony at Joint Base Myer-Henderson Hall in Arlington, VA.

Gen. Randy George, most recently the service’s vice chief, has been nominated by President Biden to be the Army’s next chief of staff and will serve in an acting capacity until confirmed.

George’s nomination along with that of Gen. Eric Smith, the nominee to be the next commandant of the Marine Corps, and 301 nominations for general and flag officers are being held up by Sen. Tommy Tuberville’s (R-AL) blockade, stemming from his opposition to the Pentagon’s leave and travel reimbursement policies for servicemembers seeking abortion services.

Austin said during Friday’s ceremony that “orderly and prompt transitions” of military leaders are needed to ensure U.S. security.

“The failure to confirm our superbly qualified senior uniformed leaders undermines our military readiness. It undermines our retention of some of our very best officers. And it is upending the lives of far too many of their spouses, children and loved ones,” he said.

Austin praised McConville for his leadership in modernizing the Army with capabilities that have included long-range precision fires, next-generation combat vehicles and missile defense.

“The Army also has brought its doctrine into the 21st century. And you’ve created new organizations that can provide more and better capabilities to combatant commanders, and strengthen our partnerships around the world, and sustain the fight wherever and whenever needed,” he said.

By Shelley K. Mesch
August 4, 2023 at 10:59 AM

DAYTON, OH -- Compared to the previous five-year average, Air Force foreign military sales are up more than 10% with two months still left in fiscal year 2023, officials told reporters this week.

The average had been $18 billion per year, Col. Elwood Waddell said here at Life Cycle Industry Days, but totals by July showed sales of $20 billion with that number still increasing.

“We’ve seen an increase in sales, particularly in the European [area of responsibility] but other places as well,” Waddell said.

F-35 Joint Strike Fighter sales saw the biggest increase of any single segment, Waddell said.

By Nickolai Sukharev
August 3, 2023 at 4:11 PM

The Army awarded a $500 million contract to Lockheed Martin to manufacture an air-to-ground missile system as part of a foreign sale, according to a Defense Department announcement.

Lockheed Martin will manufacture the air-to-ground missile system in Orlando, FL, for all the services as well as Australia, France, India and the Netherlands, with an estimated completion date of Sept. 30, 2026, the announcement says.

The contract follows earlier announcements that the Army approved Lockheed's Joint-Air-to-Ground Missile (JAGM) for full-rate production.

The JAGM has a multipurpose warhead designed to simultaneously acquire multiple targets, including those that are stationary, moving, seaborne and airborne. It can be launched from the MQ-1C UAV, the Army’s Apache helicopters and the Marine Corps’ Viper helicopters.

The missile is a successor to the military’s Hellfire family of missiles.

By Nickolai Sukharev
August 3, 2023 at 4:04 PM

(Editor's Note: An earlier announcement from the Defense Department incorrectly stated the trucks would be sent to Ukraine. The Army informed Inside Defense of this error, and the article has been updated accordingly.) 

The Army awarded Oshkosh a $200 million contract to manufacture and procure medium trucks, according to a Defense Department announcement.

Oshkosh will build the Family of Medium Tactical Vehicles, a set of logistics trucks manufactured by the company, with an estimated completion date of July 31, 2025, the announcement said.

The contract follows a Defense Department announcement that details $9.7 billion to replace weapons being sent to Ukraine as part of a military assistance initiative, as Inside Defense previously reported.

The trucks come in numerous variants, including several cargo vehicles, dump trucks and tractor trailers. They can be transported by cargo planes and perform resupply, maintenance, recovery and other support missions, according to the Army’s Acquisition Support Center.

They also have a commonality in parts and are designed to reduce the logistics burden as well as operational and support costs.

By Tony Bertuca
August 3, 2023 at 3:01 PM

House Armed Services Committee Chairman Mike Rogers (R-AL), angered by President Biden's recent decision to keep U.S. Space Command headquartered in politically blue Colorado instead of moving it to deep-red Alabama, is demanding that senior Pentagon officials comply with his requests for documents and interviews as he launches an investigation into the matter.

Rogers, in a new letter to Air Force Secretary Frank Kendall and SPACECOM chief Gen. James Dickinson, alleges that both officials have failed to adequately respond to his previous oversight requests involving the SPACECOM decision.

“Your refusal to abide by the committee’s repeated requests for responsive documents and transcribed interviews can only be considered obfuscation and purposeful delay, highlighted by the fact that the basing decision was decided while the committee’s requests are outstanding,” he wrote. “This is unacceptable.”

Rogers said it “now appears you have something to hide, otherwise a forthright response to the committee’s patient and numerous requests would have already come.”

The chairman tells the senior DOD officials if they don't comply with his request for documents and transcribed interviews, he will seek a subpoena -- and their appearance before the committee -- to compel their cooperation.

The Pentagon did immediately respond to a request for comment.

In the letter, Rogers says the documents DOD has provided thus far are unsatisfactory.

“Regrettably, this most recent document production remains unresponsive to the committee’s multiple requests,” he wrote. “This is now the fifth request for documents related to USSPACECOM’s mission or headquarters requirements.”

Rogers says Kendall and Dickinson have also failed to respond to the committee’s request to schedule transcribed interviews of them by August 18. He asks the officials to provide a timeline by which they will deliver “responsive documents” and schedule their transcribed interviews by Aug. 9.

The Pentagon announced Monday that SPACECOM would remain headquartered in Colorado Springs, CO, reversing an earlier decision made in the final days of the Trump administration that would have based it in Huntsville, AL.

The command, which is on track to reach full operational capability later this year, is anticipated to bring in 1,400 troops and their families, along with civilian employees and contractors -- nearly 65% of which are currently in Colorado.

Brig. Gen. Pat Ryder, the Defense Department’s chief spokesman, released a statement after the news broke saying the decision was made after “a thorough and deliberate evaluation process.”

But Rogers and other lawmakers from GOP-dominated Alabama have alleged that “far-left” politics are at play involving abortion policy and the previous presidential contest in which Colorado’s electoral college votes went to Biden.

However, Rep. Doug Lamborn (R-CO), along with Colorado lawmakers, felt differently about the announcement that would keep SPACECOM based in his home state.

“I commend the Biden administration for prioritizing national security above political interests and keeping USSPACECOM in its rightful home at Peterson Air Force Base,” he said in a statement. “This decision aligns with the best military advice of countless senior military leaders who all agree that Peterson Space Force Base is the most viable option for USSPACECOM to reach full operational capability the fastest and is the best permanent home for its long-term operations.”

By John Liang
August 3, 2023 at 2:08 PM

This Thursday INSIDER Daily Digest has news from the Air Force Life Cycle Industry Day conference and more.

We start off with coverage of this week's Air Force Life Cycle Industry Days:

Cropsey looks to simplify DAF Battle Network/JADC2 solutions before expanding complexity

DAYTON, OH -- The Air Force is beginning to discuss specific requirements for the Department of the Air Force Battle Network with industry in classified meetings, Brig. Gen. Luke Cropsey said Tuesday.

Senior Air Force official has positive approach to HACM

DAYTON, OHIO -- The hypersonic attack cruise missile has been in development for about a year and is progressing positively on the middle-tier acquisition development plan, according to Brig. Gen. Jason Bartolomei, program executive officer for armament.

Air Force planning on carrying two vendors through NGAD engine prototype

DAYTON, OH -- The Air Force will fund prototypes of the Next Generation Adaptive Propulsion engine from both General Electric and Pratt & Whitney, a change from the previous plan of prototyping just one engine.

The Navy awarded some big destroyer contracts this week:

Navy awards nine Arleigh Burke-class destroyers in five-year contracts

HII and Bath Iron Works have been awarded multiyear contracts to build nine Arleigh Burke-class destroyers over the next five years.

On July 28, the office of the assistant secretary of defense for industrial base policy published a notice asking industry for proposals to help develop strategies to manage risks and costs across the fledgling hypersonic industrial base supply chain:

New ICAM team launches project to wring up to 80% from cost of hypersonic weapons

The Pentagon has established an Innovation Capability and Modernization team to spearhead an effort to forge a hypersonic industrial base -- directing government investments to prop up fledgling suppliers in an ambitious goal to eventually wring as much as 80% of the estimated production cost of long-range, ultra-fast, maneuvering strike systems.

By Linda Hersey
August 3, 2023 at 12:27 PM

The service lifespan of four Arleigh Burke-class destroyers -- two homeported in Virginia and two in Japan -- will be extended, after a review showed the vessels are “well-maintained and in good material condition,” the office of the chief of naval operations, Surface Warfare division, announced today.

Approvals follow a March decision to grant the first-of-its-class destroyer Arleigh Burke (DDG-51) five more years of extra service life beyond its scheduled retirement of fiscal year 2026. Currently, the Navy has 73 active Arleigh Burke-class destroyers.

All five ships have received Aegis baseline upgrades through the DDG modernization program, which updates technology and other systems.

The service life extensions for the additional ships will be four or five years beyond their estimated working lifespan. They are as follows:

  • Mitscher (DDG-57), Norfolk, VA, set to retire in FY-30, will operate to FY-34. The ship was constructed in 1988 and commissioned in 1994.
  • Ramage (DDG-61) Norfolk, VA, set to retire in FY-30, will operate to FY-35. It was constructed in 1993 and commissioned two years later.
  • Milius (DDG-69), Yokosuka, Japan, set to retire in FY-31, will operate to FY-35. It was built in 1995 and commissioned in 1996.
  • Benfold (DDG-65), Yokosuka, Japan, set to retire in FY-31, will operate to FY-36. The ship was built in 1993 and commissioned in 1996.

“Adding 23 years of service life cumulatively over the last six months is a significant investment in surface warfare,” Rear Adm. Fred Pyle, director of Surface Warfare (N96) said, offering capability and capacity “in an affordable manner.”

By Dan Schere
August 3, 2023 at 11:15 AM

The Army is holding an industry day this month for participants interested in the service's Project Convergence exercise, according to a notice posted Thursday.

The Army has held Project Convergence, the service’s campaign of learning and experimentation with the joint and multinational force, since 2020. The next event is scheduled for the spring of 2024.

According to the notice, the industry day is scheduled for Aug. 22, and will focus on addressing challenges such as “reconnoitering and securing far side of wet gap crossing,” autonomous delivery of large quantities of supplies, management of autonomous systems, erosion control in wet gap crossing and the ability to defeat targeting and delivery capabilities of precision munitions.

Army Under Secretary Gabe Camarillo said earlier this week at a Potomac Officers Club meeting that the next Project Convergence will take place at the theater level and will include ballistic missile defense. The exercise, he said, will feature more participants than in prior years including with joint services and more partners and allies.

“And it will incorporate the ability to experiment with emerging technology in really fundamentally creative and innovative ways,” he said.

Camarillo said the Army wants to experiment with technology in a way that is more collaborative with industry going forward, saying this is a campaign of learning that is not a “discreet, standalone, isolated Army effort.”

Camarillo added that Army Futures Command is expected to deliver drafts either by the end of this year or early next year “to facilitate more of what they refer to as a campaign of deep learning and experimentation across the Army.” Going forward, requirements will need to be written in a way that focuses more on how technology evolves, and more feedback from soldier touchpoints will need to be incorporated, he said.

“All of this to say, rather than starting programs, we want to experiment with technology, we want to learn, we want to iterate on concepts, and most importantly we want to do it as part of the joint force,” he said.

By Dan Schere
August 2, 2023 at 4:45 PM

BAE Systems President and CEO Tom Arseneault says after a positive first half of 2023 in the combat vehicles area, the company expects part of the business to remain profitable.

Order intake in BAE’s platforms & services sector, which includes combat vehicles, weapons and munitions, was $5.1 billion in the first half of 2023, compared with $2 billion in the first half of 2022, according to a company earnings statement. Sales in the sector were $2.3 billion in the first half of 2023, compared to $2.1 billion in the first half of 2022.

According to the company, much of the order intake has been driven by the awards of the Armored Multi-Purpose Vehicle to the U.S. Army, as well as awards of the CV90 fighting vehicle in Europe and the BvS10 to multiple European nations and the United States.

Arseneault said Wednesday during a company earnings call that the company was disappointed in the Army’s decision not to move forward with BAE in the down select of the XM30 Mechanized Infantry Combat Vehicle -- the eventual successor to the Bradley Fighting Vehicle. Instead, the company plans to focus on “what’s been a buildup and backlog for the combat vehicles business,” he said.

“That business has been on a good margin expansion journey. We expect that to continue,” he said.

Arseneault also touted the Army’s recent decision to move the AMPV program to full-rate production, and said BAE expects a contract in the second half of the year.

By Nickolai Sukharev
August 2, 2023 at 2:41 PM

(Editor's Note: This story has been updated to reflect that Oshkosh reported quarterly revenues of 17%, not 200%. The company also lost a JLTV protest to AM General, not General Dynamics.) 

Oshkosh announced the acquisition of the airport services firm Aerotech and reported revenues of more than 17% from its previous year, according to the company’s second-quarter earnings release.

“During the quarter we announced plans to acquire the AeroTech business from JBT Corp.,” said John Pfeifer, Oshkosh's president and chief executive officer during a Tuesday earnings call. “With this acquisition, we are even more confident in our Vocational segment’s ability to be a $3 billion plus revenue segment at attractive double-digit operating margins over time.”

AeroTech specializes in aircraft service vehicles, logistical vehicles and commercial airport services. The company’s defense segment produces vehicles used to service military aircraft at airbases.

Oshkosh acquired AeroTech from JBT Corp., an aviation conglomerate based in Chicago.

In revenues, Oshkosh reported sales of $2.4 billion for the second quarter of 2023, up from $2 billion in the second quarter of fiscal year 2022.

“We are pleased with our strong financial performance in the quarter, highlighted by significant growth in sales and operating income,” Pfeifer added during the call.

The company’s defense segment reported a decrease in revenue reporting $498.1 million in revenue in the second quarter of 2023, down from the $539.3 million reported in the second quarter of 2022.

Pfeifer said the revenue decrease was “expected” but added the company sees “income improvement” with more contract awards.

In June, the Government Accountability Office denied Oshkosh’s protest of the Army’s decision to award the next production phase of the Joint Light Tactical Vehicle to AM General. Pfeifer emphasized the company will continue to build the vehicle for the Army through the end of the contract in 2024 before focusing on international orders.

Oshkosh is also contracted to upgrade Stryker armored personnel carriers as well as build medium and heavy tactical trucks, all of which the company will continue to deliver for the Army, Pfiefer said.

In its non-defense businesses, Pfiefer added the company continues to get orders for its electric refuse collection vehicles and the electric postal vehicle, with revenues at $587.5 million in second quarter of 2023, up from the $551.8 million reported in the second quarter of 2022.

“We expect further growth in both sales and margins driven by numerous positive factors, which include improving supply chains, benefits from price cost, especially in the vocational segment,” he said.

By John Liang
August 2, 2023 at 2:16 PM

This Wednesday INSIDER Daily Digest has more details on the weapons contracts awarded to supply Ukraine in its fight against Russia's invasion, the Marine Corps looking at a U.S. facility to produce an Israeli interceptor missile and more.

An information graphic released by the office of the Pentagon's acquisition chief this week details $9.7 billion in Ukraine weapons replacement obligations:

DOD releases new details on replenishment contracts for weapons sent to Ukraine

The Defense Department has released a new compendium of information on $9.7 billion in contracts to replenish U.S. weapons that have been transferred to Ukraine.

R2S -- a partnership between RTX and Rafael -- initially announced plans for U.S.-based Tamir production in August 2020, indicating a site location would be finalized by year’s end. Today, R2S still has not announced a production facility location:

Marine Corps eyes Arkansas site for domestic Tamir interceptor production

Marine Corps representatives visited a location in Camden, AR, and met with U.S. defense contractor RTX and Israeli company Rafael to "discuss the possibility" of domestically producing the Tamir interceptor missile, according to a Tuesday service announcement.

In a July 27 memo, Under Secretary of Defense for Research and Engineering Heidi Shyu designated Navy Rear Adm. Douglas Williams to head the Missile Defense Agency while Air Force Maj. Gen. Heath Collins' appointment to lead MDA is held up over Sen. Tommy Tuberville's (R-AL) objection to DOD's women's health policy:

Tuberville blockade forces DOD to appoint newly promoted one-star to run MDA

The Pentagon's top technology development official has designated a one-star admiral to head the Missile Defense Agency until the nomination for a new director to fill the three-star billet -- one of many senior officer promotions being blocked by Sen. Tommy Tuberville (R-AL) -- is confirmed by the Senate.

Document: Shyu memo on new acting MDA director

The Army's decision to move the Armored Multi-Purpose Vehicle program into full-rate production comes in spite of concerns about the production rate for the vehicles noted by Congress last week:

AMPV moving to full-rate production

The Army has decided to transition the Armored Multi-Purpose Vehicle program into full-rate production, according to service acquisition chief Doug Bush -- a major milestone for the program that will eventually replace the M113 armored personnel carrier.

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

Defense ISAC sees challenge in contractor compliance with NIST proposed tailoring parameters for CUI

The use of "organization-defined parameters" in the National Institute of Standards and Technology's proposed update to its foundational controlled unclassified information publication could lead to a decline in the number of contractors in the defense industrial base, according to the leading info-sharing group for the defense sector.

By John Liang
August 2, 2023 at 10:06 AM

General Dynamics' board of directors has elected Laura Schumacher as an independent lead director, the company announced this week.

Schumacher has served on the GD board since February 2014. She's the former vice chairwoman for external affairs and chief legal officer of Abbvie, and was previously executive vice president, general counsel and secretary of Abbott Laboratories.

Schumacher also serves as a director of Crowdstrike Holdings, according to GD.

By John Liang
August 1, 2023 at 5:06 PM

The Defense Business Board will meet in closed session on Wednesday and Thursday, according to a Pentagon notice.

The meetings will include classified briefings from:

  • Space Force modernization and Joint Force integration from Vice Chief of Space Operations Gen. David Thompson;
  • Assessing innovation through the defense authorization bill from Deputy Defense Secretary Kathleen Hicks;
  • DOD current affairs from Defense Secretary Lloyd Austin;
  • Artificial intelligence/machine learning "scaffolding" from Joe Larson, deputy director of the Chief Digital and Artificial Intelligence Office for Algorithmic Warfare;
  • The Globally Integrated Wargame and recommendations from Air Force Lt. Gen. Dagvin Anderson, director for Joint Force development;
  • Joint Force Capabilities Integration from Chief of Naval Operations Adm. Michael Gilday;
  • The state of the National Guard from National Guard Bureau Chief Gen. Daniel Hokanson.
  • A classified update on the DBB Improving IT User Experience Study from DOD Chief Information Officer John Sherman;
  • The U.S. economic outlook and recent NATO Summit from White House Chief of Staff Jeff Zients; and
  • National Security Adviser Jake Sullivan.
By Tony Bertuca
August 1, 2023 at 3:21 PM

The Defense Department will not say what is included in a $345 million weapons package President Biden ordered for Taiwan because of operational security and the diplomatic sensitivity of the situation regarding China, according to DOD's chief spokesman.

The package, announced last Friday via presidential “drawdown” authority, will transfer weapon systems directly to Taiwan from U.S. stocks. The same authority is used for U.S. assistance to Ukraine, which DOD touts publicly with detailed documents and press conferences denouncing the ongoing Russian invasion.

But the package for Taiwan -- which China considers to be a renegade province -- is a different story.

“The reason why we are being more circumspect on this is due to operational security on the part of the Taiwanese as well as sensitivity to the diplomatic situation,” Pentagon Press Secretary Brig. Gen. Pat Ryder said today.

Biden’s order directing the weapons transfer to Taiwan said it includes “defense articles and services of the Department of Defense, and military education and training, to provide assistance to Taiwan.”

“I'm not going to be able to go into details into specific capabilities in the PDA,” Ryder said.

Previously released media statements from spokesman Lt. Col. Martin Meiners say the systems included “critical defensive stockpiles, multidomain awareness, anti-armor and air defense capabilities."

Ryder today would not confirm that the package included drone technology.

Defense Secretary Lloyd Austin told Senate appropriators on May 16 that a PDA was in the offing for Taiwan, but Republican lawmakers blamed the White House in the following months for allegedly dragging its feet for fear of angering Beijing.

Senate Armed Services Committee Ranking Member Roger Wicker (R-MS) released a statement Friday voicing his support for aiding Taiwan.

“I strongly support President Biden’s long-delayed choice to exercise the authority Congress provided him to arm Taiwan with real capabilities to defend itself,” he said. “This is exactly why Congress passed the Taiwan Enhanced Resilience Act, which allows the administration to transfer substantial amounts of U.S. defense articles and services to Taiwan. I urge the president to make use of the remaining authority as soon as possible.”

Wicker said he also looks forward to working with the Biden administration and other members of Congress to use foreign military financing to provide further assistance to Taiwan.

The Senate Appropriations Committee, meanwhile, has advanced a fiscal year 2024 defense spending bill that would allocate another $1.1 billion in PDA assistance for Taiwan.