Defense Daily. SAS Special Show Coverage. Day 3 Wednesday May 6, Schedule Of Events

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1 Defense Daily Day 3 Wednesday May 6, 2009 Schedule Of Events SAS Special Show Coverage CNO Encouraged With LCS Progress, Pledges Vigilance On Cost Oversight By Emelie Rutherford The Navy s top officer said on Monday he is encouraged with steps the two Littoral Combat Ship (LCS) builders have taken to control the price of their second vessels, and will monitor closely the ships costs amid congressional concerns. The service last Friday awarded General Dynamics [GD] a fixedprice contract of an unspecified amount for its second littoral ship: the USS Coronado, LCS-4 (Defense Daily, May 4). The Navy in March awarded rival LCS shipbuilder Lockheed Martin [LMT] a similar contract for its No. 2 littoral ship: the USS Fort Worth, LCS-3 (Defense Daily, March 24). After well-publicized cost and schedule problems with each company s shore-hugging littoral ships, Chief of Naval Operations Adm. Gary Roughead told reporters yesterday he is encouraged by some of the steps that have been taken on both (LCS-)3 and (LCS-)4. House Armed Services Seapower subcommittee Chairman Gene Taylor (D-Miss.) has considered legislative language directing the Navy to open the LCS program to increased competition if costs cannot be controlled (Defense Daily, March 20). Critics note this move would not necessarily solve cost and schedule problems that plague Navy ship programs. Asked about Taylor s idea to increase LCS competition, Roughead said that Navy will continue to drive to bring those costs down with LCS-3 and LCS-4 and welcomes Taylor s oversight. Clearly Congress in its oversight role will be watching that very carefully and closely, and I thank Gene Taylor for everything he does to work shipbuilding issues and make sure that we re getting the most bang for the buck, Roughead said after the sea service chiefs addressed the Navy League s Sea Air Space Exposition in National Harbor, Md. Roughead spoke favorably about steps General Dynamics took, before last Friday s LCS-4 contract award, to begin fabrication for that follow-on ship. They actually started building some things in anticipation of (LCS-)4 coming along, (and) what was shared with me and what I was able to see is being able to complete similar steps on (LCS-)4 that were done on (LCS-)2 in less time with less money, he said. c Continued on page 2 Visit us at the SAS Show May 4-6 Booth :00am 2:00pm Attendee Registration Open (Exhibit Hall Level - Hall E) 9:30am 3:30pm Exposition Open 9:30am 10:00am Floor Speaker - "Naval Unmanned Aviation and Strike Weapons" (Sea-Air-Space Booth 1312) Rear Admiral Bill Shannon, USN - PEO Unmanned Aviation and Strike Weapons 10:00am 11:30am Acquisition Outlook and Priorities Panel: The Art of the Possible (Room - Potomac 5) Vice Admiral David Architzel, USN Principal Deputy Assistant Secretary of the Navy (RDA) Vice Admiral Bernard J. McCullough III, USN Deputy Chief of Naval Operations for Integration of Capabilities and Resources Lieutenant General Duane D. Thiessen, USMC Deputy Commandant for Programs and Resources Rear Admiral Gary T. Blore, USCG Assistant Commandant for Acquisition & Chief Acquisition Officer Dr. Eric J. Labs Senior Analyst for Naval Forces and Weapons, Congressional Budget Office 11:30am Noon Floor Speaker - "Littoral Combat Ship Program Update" (Sea-Air-Space Booth 1312) Captain John Neagley, USN - LCS Assistant Program Manager Noon 1:30pm Secretary of the Navy Luncheon* Keynote speaker: The Honorable B. J. Penn Acting Secretary of the Navy Presentation of Safety Awards Admiral Vern Clark Safety Awards General James L. Jones Safety Awards (limited complimentary tickets for U.S. uniformed military members and federal government employees) 1:30pm 2:00pm Floor Speaker - "Introduction to PEO Land Systems Marine Corps and Expeditionary Fighting Vehicle (EFV) Program Update" (Sea-Air-Space Booth 1312) Mr. Bill Taylor - Program Executive Officer, Land Systems Colonel Keith Moore, USMC - EVF Program Manager 3:30pm Exposition Closes 2009 by Access Intelligence, LLC. Federal copyright law prohibits unauthorized reproduction by any means and imposes fines of up to $100,000 for violations.

2 May 6, 2009 Defense Page 2 Daily c Continued from page 1 Roughead said the most recent experience he had was with General Dynamics, but that he s also encouraged by some of the things he s hearing about Lockheed Martin s littoral ships. At both companies shipyards, Roughead said he s very encouraged by the facility and investments that both companies are putting in place so that they can get good production runs going, that they can get more efficient manufacturing techniques in place, that they can do it in a way is not dependent on environmentals. Roughead said that while he is encouraged with the companies transitions from building their first to second littoral hulls, that doesn t mean to say that the pressure should not be kept on, that the pressure will not be kept on. We re going to continue to press hard to bring cost down, not compromise on quality, and get the numbers out there that we need, he said. The Navy in 2007 canceled previous contacts with both shipbuilders for second LCSs after the sides couldn t agree to contract terms that service sought to control costs. Cost overruns with the initial littoral ships have been attributed in large part to the Navy s changing of requirements and standards. The service plans to buy 55 of the ships. Roughead said last week the service is not looking to increase that number. n Navy Continues At-Sea Shipboard Landings of Fire Scout VTUAV By Geoff Fein The Navy conducted a series of landings and approaches of the Fire Scout vertical takeoff unmanned aerial vehicle (VTUAV) in the most recent tests of the Unmanned Common Automatic Recovery System (UCAR), a Navy official said. We did a total of eight landings and seven approaches. The landings were repetitive to get the landing dispersion how far away from dead center on the grid we wanted to be, Capt. Tim Dunigan, Fire Scout program manager, told Defense Daily Monday at the annual Navy League Sea Air Space expo in National Harbor, Md. Additionally, the Navy conducted wave-offs to check the functionality of lost links and lost UCARS, Dunigan said. The aircraft performed exactly as we expected, he said. Like anything, you learn all the time you test fly; that s why you go test fly. Northrop Grumman [NOC] builds Fire Scout. The Navy is intending to deploy the VTUAV from the Littoral Combat Ship. Dunigan noted there were some minor issues that cropped up that the crews worked through. For example, testers had trouble with one of the ground control station s fans. The Navy has been testing Fire Scout at sea aboard the USS McInerney (FFG-8). However, those initial tests were cut short last month due to bad weather. The Navy then agreed to wrap up the tests in late April (Defense Daily, March 24). The Navy will now begin dynamic interface testing--how the aircraft handles the wind around the super structure, Dunigan explained. That s what s going to go on for the majority of this week, he said. Then, depending upon how much of that testing gets completed, the Navy will go into mission-based scenarios. The Navy could also bring in an H-60 helicopter for those tests, Dunigan added. I don t expect that to happen. I really just want to get the wind envelope cleared, he said. We want to start off with wind down the bow and we ll probably vary the wind speed--the wind over deck--by driving faster into the wind. Once that gets complete, the VTUAV will come back for the next run, but operators might do it 10 to 15 degrees to port, and that will cause the wind to come down on the starboard side, Dunigan added. What we are looking at is how did that aircraft handle with that new wind condition? Program officials will hand off Fire Scout to the fleet, with ideas of how they think sailors are going to use it, Dunigan said. And they are going to tell us how they are really going to use it. DEFENSE DAILY (ISSN ) is published each business day in print and electronically by Access Intelligence, LLC Managing Editor: John Robinson, jrobinson@ accessintel.com Army/International: Ann Roosevelt, aroosevelt@accessintel.com Business: Calvin Biesecker, calvinb21@aol.com Congressional Reporter: Emelie Rutherford, erutherford@accessintel.com General Assignment: BC Kessner, bckessner@mac.com Navy/Marine Corps: Geoff Fein, gfein@accessintel.com Pentagon: Marina Malenic, mmalenic@accessintel.com Space & Missile Defense: Dave Ahearn, dahearn@accessintel.com Editor Emeritus: Norman Baker Senior Production Manager: Tracey Lilly Senior Marketing Manager: Teri Fisher, tfisher@accessintel.com Associate Publisher: Jennifer Green-Holmes, jgreenholmes@accessintel.com VP & Group Publisher: Jennifer Schwartz, jschwartz@accessintel.com Divisional President: Heather Farley, hfarley@accessintel.com SVP Information Technology: Rob Paciorek President & CEO: Don Pazour To advertise in Defense Daily contact Jennifer Green-Holmes at jgreenholmes@accessintel.com. To subscribe, contact clientservices@accessintel.com or 1(301)

3 May 6, 2009 Defense Daily Page 3 And they ll say if you can do this, this, and this, that would be really neat, he added. So that s the real reason we want to get it out now ahead of LCS. We want to learn those lessons today, so that when LCS is available [Fire Scout is] a much more mature and capable platform. n AH-6 Prepares To Demonstrate High-Hot Capability By Ann Roosevelt NASHVILLE, Tenn.--By September, Boeing [BA] expects to have demonstrated the AH-6 helicopter s capability to hover out of ground effect at 6,000 feet in 95-degree temperatures, a key performance characteristic the Army requires for any new armed reconnaissance helicopter. Al Winn, Boeing vice president of Apache programs, said Monday at the Army Aviation Association of America s annual conference here that will put the helicopter at Technology Readiness Level 7 that means any customer who wants a light reconnaissance attack helicopter at low risk in a program going forward, [the AH-6] provides that capability and Boeing can provide the aircraft very quickly. Mike Burke, director of Business Development for Army Rotorcraft at Boeing, said, The Army wants this kind of capability in the high altitudes and temperatures in Afghanistan. In October, the Pentagon canceled the potential $6 billion-plus Armed Reconnaissance Helicopter contract with Bell Helicopter Textron [TXT] for cost and schedule concerns. Bell had nosed out Boeing for the contract in 2005 (Defense Daily, Feb. 27). However, the requirement remains for about 512 such aircraft, and to retire the aging Bell Kiowa Warrior. The Army sent out a sources sought request for information to industry asking what capability exists to meet the needs, including at 6,000 feet in 95 degrees with three hours of fuel (Defense Daily, Nov. 12). In December, the aviation program executive officer and the Army staff said no aircraft could meet that need, Mike Burke, Boeing director of Business Development for Army Rotorcraft, said in the same briefing. This is a flying prototype. This summer, we re going to demonstrate 6,000/95 and after this summer they won t be able to say that anymore, he said. To resolve the way forward, an analysis of alternatives will begin likely some time this summer, and will take 18 months or so to complete. Currently, the AH-6 meets all key performance parameters and requirements in the current capability document, Burke said. Last fall, Winn said, the AH-6 was just a brochure. Today, it is a flying prototype, one exhibited here at Quad A, along with a variant body that can carry four personnel. In putting it together, our objective was to provide a capability as quickly as we could and to provide optional capability characteristics for the customer, Winn said. The AH-6 has a heritage stretching to the AH-6M used by the 160th Special Operations Aviation regiment. That means the mounts exist for weapons qualified on the airframe, to include the Hellfire missile, the M260 seven-shot rocket pod, a machine gun and a mini-gun integrated with a sensor system. The AH-6 kept the weapons plank and stores installation, but the whole avionics architecture and installation is new, Winn said. In fact, the cockpit looks a lot like the Apache Block III, and is a scaled down version of the Block III avionics architecture mission systems. All but two [avionics] boxes of the AH-6 come from the Apache Block III, he said. There is also a percent commonality in software with Apache Block III. The commonalities mean life-cycle costs and the cost of ownership are reduced, he said. Unlike the older AH-60M, the avionics are now in the nose of the aircraft and out of the cabin, leaving more room there. The variant on display here--ah-6s, S for stretch-- has a larger cabin, allowing four troops to sit facing each other, comfortably and with room between their knees. Under the floor is a larger internal fuel capacity. Other improvements on the AH-6 include new rotor blades, up-rated engines from Rolls-Royce. An unmanned version of this [the aircraft on exhibit] is flying in Mesa today, Winn said. The unmanned version is tied to the Apache Block III Level 4 unmanned aerial vehicle (UAV) controls, and is flying today demonstrating the UAV connection with Apache Block III prototypes, he said. With a kit, there s an optional capability to fly manned or unmanned, and the kit can be applied in the field, he said. Our solution is to do both. We can make it manned or unmanned as you [the customer] decide, and it doesn t c Continued on page 6

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6 May 6, 2009 Defense Page 6 Daily c Continued from page 3 require a procurement decision ahead of time; operational units can decide day-to-day which version they want to use based on their operations, Winn said. We provide the customer the flexibility to take the airplane and missionize it. Burke said the AH-6 will be interoperable with Apache, and this seems to be the quickest way to get a capability in the field quickly. We anticipate we could start delivering the aircraft in two increments, Burke said. The first increment would be produced to get to the field quickly, then a second increment when Block III testing is complete and the AH-6 can be fielded with Block III capabilities. To back fit the first two battalion sets would mean changing out the mission computers. Burke estimates production at about 72 helicopters per year. It s the quickest way to retire the Kiowa Warrior fleet, get it to the troops as fast as we could, and be able to operate with and be interoperable with Apache, and do it inside the cost of the expected program of record cost, and do it quicker than any other capability out there, he said. Additionally, a number of foreign countries are window shopping, and have asked for a briefing on the AH-6, Winn said. n House Approps Boost War Supp $4.7 Billion; Add Cargo Planes, Mine-Proof Trucks By Emelie Rutherford House appropriators want to bolster war-funding in the White House s supplemental spending request by $4.7 billion, with much of the increase covering C-17 and C-130 cargo aircraft and mine-resistant vehicles. The proposed plus-up, supported by House Appropriations Committee (HAC) Chairman David Obey (D-Wis.) and unveiled Monday at the Capitol, is less than the $10 billion to $12 billion House Appropriations Defense subcommittee (HAC-D) Chairman John Murtha (D-Pa.) previously called for adding to President Obama s supplemental request. The White House is said to have called for curbing Murtha s proposed add-ons. Murtha told Defense Daily last Thursday he thought we d be able to work out more added funding in the supplemental, yet said monies instead were shifted to the State Department and for domestic programs in the legislation that includes non-defense spending (Defense Daily, May 1). Details on the current House version of the supplemental were circulated Monday on Capitol Hill, in accord with rules that call for such a distribution three days before the HAC s markup, which is scheduled for tomorrow. The HAC-D last week finalized its proposals to the HAC. The supplemental bill is intended to cover war-related operations in Iraq, Afghanistan, and Pakistan through the end of fiscal year 2009 on Sept. 30 (Defense Daily, April 13). Obama on April 9 requested $75.5 billion in war funding within a bill totaling $83.4 billion. Obey is proposing a supplemental with an overall $94.2 billion pricetag, which also reflects a recent administration request for flu-related funds. House appropriators want to add $2.2 billion to the war-funding bill for buying eight of Boeing s [BA] C-17s, transport aircraft which Obama did not include in his supplemental request. While Defense Secretary Robert Gates wants to buy no more C-17s than the 205 ordered, some lawmakers have been pushing to fund 15 C-17s in the supplemental. Murtha said last week that if C-17s are added to the bill, there would have to be an offset to an existing weapons program, which he did not identify. Accordingly, the bill the HAC will take up tomorrow calls for adding the eight C-17s and decommissioning some existing C-5 transport aircraft, which are built by Lockheed Martin [LMT]. The House-side supplemental unveiled Monday also calls for adding $904.2 million to the administration s proposal for buying 11 of Lockheed Martin s C-130s, also cargo planes not requested in Obama s supplemental proposal. The funding would cover three MC-130Js, three HC-130Js, and five C-130Js. By adding the money for the C-130s, appropriators are calling for essentially moving forward President Obama s recommended purchase for 2010, Obey said in a statement released after he talked to reporters in his office. House appropriators also want to add $2.1 billion to the administration s request for Mine Resistant Ambush Protected vehicles (MRAPs), growing the figure from the $2.7 billion requested to $4.8 billion. An earlier supplemental for FY `09 included $1.7 billion for MRAPs. Those funds, when added with the $2.7 billon the administration requested within the latest supplemental, were expected to cover the minimum requirement of

7 May 6, 2009 Defense Daily Page 7 2,080 of a new MRAP All-Terrain Vehicle (M-ATV). Thus, the added funds proposed by House appropriators could potentially increase the number of M-ATVs purchased above that 2,080 minimum. Obey also is calling for adding to the administration s supplemental $338.4 million for 225 Stryker medical-evaluation vehicles and 35 Stryker engineering-squad vehicles, trucks built by General Dynamics [GD] which the administration did not request. The current House bill also grants Obama s request for six Stryker mobile-gun-system vehicles. The bill circulated Monday calls for raising funding for items already requested by Obama, with increases including: $243.6 million more for modification of BAE Systems Bradley vehicles; $432.7 million more for upgrades of Boeing s AH-64 helicopters; $110 million more for buying General Atomics MQ-9 Reaper unmanned aerial vehicles; $175 million more for purchasing Bell Helicopter Textron s [TXT] H-1 choppers (seven more); and $90 million more for procuring Boeing s CH-47 helicopters (three more). The HAC chairman also wants to heed the administration s request for buying four F-22 fighter jets from Lockheed Martin, the final ones Gates wants to buy. The White House is said to have helped quash Murtha s attempt to insert language in the supplemental directing the Pentagon to buy aerial refueling tankers from both competitors vying for the long-stalled contract, Boeing and a Northrop Grumman [NOC]-European Aeronautic Defence and Space Co. (EADS) team. I couldn t work it out, Murtha told Defense Daily last Thursday about the exclusion of his tanker dual buy plan from the supplemental. I did everything I could, but we re going to have to wait until the main bill, he said, referring to the forthcoming FY 10 defense budget proposal. Obey said Monday: The (supplemental) bill does not address the tanker issue. Gates has called for a traditional winner-take-all tanker competition to start this summer. The full House is likely to take up the supplemental next week. The Senate Appropriations Committee also is expected to mark up its version of the bill next week. Several lawmakers and aides have predicted the bill will not pass both chambers and then a conference committee by the Pentagon s requested Memorial Day deadline. n Pinpointing new business leads. Defense Daily alerts you to lucrative new opportunities. Gaining solid market awareness. Understand where the market is going, identify emerging market trends and track key developments. Gathering insider intelligence and analysis from experienced, credible reporters. GET 10 ISSUES OF Defense Daily ABSOLUTELY FREE!! Complete and return this order form today, and you ll get ten FREE issues that s 2 full weeks of access to the latest defense industry developments. Defense Daily is the only daily that combines in-depth analysis, immediacy and accuracy with comprehensive coverage. Capture need-to-know news direct from the Pentagon, NASA, Capitol Hill, Wall Street, and the White House. Gain a powerful competitive advantage by: Making better-informed decisions. Act on budget news from Congress before it becomes law. Scooping the Competition. Track the programs your competitors are bidding on, winning and losing. Positioning yourself for profit in the rapidly evolving homeland defense industry. Complete and fax the form below to Name Job Title Company Address (no P.O. box, please) City State Zip Country Phone Fax Voice: Outside U.S., clientservices@accessintel.com *Free two week trial valid for new subscribers only. Priority Code: SAS09

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