An Israeli-French joint venture to be established by early 2011 will focus on tactical Unmanned Aerial Systems (UAS). A principal agreement on the move was signed today as a Memorandum of Agreement (MoA) between the French defense company Sagem Defense Securite and Israel’s Elbit Systems.
The two companies will establish a jointly owned French corporation, to be located in Eragny and Montluçon in France and owned by the two companies in equal shares. The new company’s portfolio will comprise newly developed products, as well as current and derivative products, from Sagem and Elbit Systems. The new venture will target the French market and specific international markets, in which existing initiatives will continue through the JV. The new company will be formed by the equal contributions of assets from the two parent companies.
Sagem is the leading French developer and manufacturer of UAS. Two of the company’s products are the Sperwer Mk II tactical UAS and its derivatives, and the Patroller, a new medium altitude, long endurance drone.
Elbit Systems has a wide range of tactical UAS, from the lightweight Skylark 1LE and Skylark II, to the Hermes 90, and Hermes 450 which has already been considered by the French Army. A larger platform, Hermes 900 was recently added to the product line. Elbit Systems has an ongoing cooperation with Thales, for joint development, marketing and support of UAS. Thales is leading the Watchkeeper program in the UK, providing tactical UAS for the British Army. Development, production and support of these systems is provided by U-TACS, a JV established by the two companies, similar to the one Elbit is launching with Sagem.
Apart from their parallel UAS business lines, the two companies have also competing activities in the fields of electro-optical payloads, soldier systems, thermal imagers and and target acquisition systems.
U.S. Secretary of Defense Robert Gates and undersecretary of defense for acquisition, technology and logistics Ashton B. Carter announced yesterday new rules guiding the Pentagon’s $400 billion-a-year procurement process. These guidelines are expected to save $100 billion over the next five years without impairing warfighting capabilities and readiness. By implementing this strategic reform, the Pentagon expects future systems will become more affordable, reliable and supportable.
“Consumers are accustomed to getting more for their money — a more powerful computer, wider functionality in mobile phones — every year,” said Gates “when it comes to the defense sector, however, the taxpayers had to spend significantly more in order to get more. We need to reverse this trend”. One of the key elements in Gates’ new rules is for program managers set a new affordability target. “This target can’t be altered without authority from Carter. Managers must ensure the initial design is constrained by its ultimate schedule and cost.” Gates explained, adding that this guidance will make programs more affordable without sacrificing capabilities and prevent us from embarking on programs that will need to be cancelled when they prove unaffordable.
Gates and Carter outlined the 23 areas expected to be improved by the plan. Specifically, new contracts will address and mandate affordability to control cost escalation. By implementing these procedures the Pentagon plans to reduce 27 percent in a program where costs are projected to be more than $100 billion.
Some of the new programs to be started in the near future will put the new rules to the test. These include the next-generation ballistic missile submarine (SSBNX), long-range strike systems for the Air Force and Navy, and the Marine Corps presidential helicopter and the ground combat vehicle. The later was cancelled recently and the current pause will enable the PM and industry to ‘start on the right foot’, along with the new procedures.
Under the new policy companies will be required to provide more predictable cost estimations and meet those costs down the road. They will be rewarded for efficiency, consistently delivering affordable systems on time, and below budget. When costs increase happen, contractors will be required to share the burden. Prime contractors are likely to be most exposed to this new risk, but subcontractors could also find themselves vulnerable when required to take responsibility on delays they cause, far exceeding their share of a program. Therefore, the new regulation, although positive in theory, is likely to cause significant concern among second and third tier suppliers.
On its part, the government will examine processes to streamline the process, for example, by committing multi-year contracts over year-by-year acquisition. More competition and the encouragement of small business enterprises are also considered vital for cost reduction. As an example, the littoral combat ship program shifting from directed to competitive buys, is expected to save over $1 billion.
To increase affordability and reduce life cycle cost, the Pentagon will require the use of open-system architecture.
Another area where the defense sector fails to achieve the results of the open market is in outsourcing contracts, considered a significant money saver in the commercial market. Outsourcing services in general have grown dramatically in the past decade. “This area that has grown to become a $200 billion annual cost to the department,” Carter said. “Half of our costs are for services, and we’re performing worse there,” he said. Indicated this inflated outsourcing should be better managed. To improve control, the Pentagon is shifting back to in house contract management. In the past year the Pentagon has been hiring procurement officers in the thousands to handle the acquisition process outsourcing to industry in the past decade. Aware of the potential of bureaucracy they may add, Carter promised to weed out those ‘ unproductive bureaucratic processes’.
Carter added that he will oversee progress daily and will provide progress reports to Gates monthly. “To those who hesitate, to those who fear to go down this path, they need to consider the alternative: broken promises, cancelled programs, unpredictability and uncertainty that is bad for industry, erodes taxpayer confidence, and worst of all, results in lost warfighter capabilities,” he said.
The MPC is a new capability that will be a multi-wheeled, armored personnel carrier designed to operate across the range of military operations but focused on an irregular warfare operating environment characterized by operations in constrained and urban terrain. Required to carry 8-9 combat loaded marines and 2-man crew, the MPC will enable high-speed land maneuver as well as substantial ballistic protection to embarked marines.
Originally, the Marine Corps envisaged the MPC to provide ‘landward lift’ to the infantry battalions, with two vehicles lifting a reinforced squad.However, with the cancellation of the Expeditionary Fighting Vehicle (EFV) and possible cancellation of the Joint Light Tactical vehicle (JLTV) the corps re-assessed the roles of the MPC, adding amphibious capability to its requirements. This has eliminated most of the competitors that have not prepared for such capability but improved the prospects of companies like Iveco, with its SuperAV 8×8 variant, designed for amphibious operations from the beginning. Iveco is now teamed with BAE Systems for the MPC program. Lockheed Martin has teamed with Patria to offer an amphibious variant of the AMV for the MPC program. Patria has been offering the amphibious capability with the AMV as an option, but sofar it was not designed to operate at sea and high surf zone. The vehicle has already demonstrated more advanced amphibious capability to Marine Corps officials in amphibious tests in Finland.