Weekly Defense Industry Roundup

Garrison Commanders Looking for Savings Through Consolidation, Cuts

Steven Beardsley and David Rogers, Stars and Stripes. While the debate in Washington continues over cuts to the military budget, cuts are already being implemented in the military. In Europe services are being cut back and consolidated at military installations as part of a drive by Army Secretary McHugh to cut $2.5 billion from installation budgets by 2014. We post this piece because it’s important that policymakers understand it’s not “weapons” that will be cut when you cut defense. Its services and other parts of the military system that will face belt tightening. Too often this debate is tossed off as “we can do without more guns” but really that’s the easy stuff. The hard stuff is libraries for military kids overseas or other pieces that make military life more bearable.

Boeing Delay on Warthog Contract Draws Senate Cut

Tony Capaccio, Bloomberg. In another sign of Congressional impatience with delayed programs and excuses from industry the Senate cut all $145 million for FY 2012 from Boeing’s $2 billion program to upgrade the wings of the U.S. Air Force’s A-10 Warthog fleet.  The program is currently some 10 months behind schedule and hasn’t delivered a single wing set in two years.  The pre-production set had a host of problems and was rejected setting the program back. Congress is getting bolder in cutting underperforming programs and it remains to be seen if funding will be restored.

Army Caps Costs of Humvee Upgrades

Michael Hoffman, Army Times. The complete RFP was released by the Army this week for the Humvee recap program and it has set a maximum cost of $180,000 per vehicle. The reasoning is simple according to the Army and Marine Corps. It makes no sense to have upgrades to the Humvee that end up costing more than a new vehicle would cost. By 2030 the Army will upgrade 60,000 to 100,000 of their vehicles with another 3,400 for the Marines. There will be an industry day this week and proposals are due in January for the first phase.

Army, Marines Could Cut 150k Troops

Charles Hoskinson, Politico. Chuck analyzes the report issued by the House Armed Services Committee staff last week breaking down their view of the devastating effects of the failure of the super committee to find the needed cuts and the worst case scenario of $500 billion in further cuts. The analysis projects a loss of 150,000 soldiers and Marines, cuts of aircraft carrier groups and other capabilities that would bring the military to its smallest share of the budget since prior to World War II.

The Truth About Who Fights for Us

Ann Marlow, Wall Street Journal. Marlow takes on the persistent myth that the military is a dumping ground for those without other work options or from the urban ghettos. The fact is that the most recent look at the statistics showed that poor and urban areas are underrepresented in the military while well off families are overrepresented as a percentage of the population. The military remains an opportunity for many to serve and to make their way in the world.

Economy to Be a Challenge for New Military Chief

Thom Shanker, New York Times. Shanker talks to General Dempsey about how he prepared for the reality that all of his expertise in our nation’s wars hadn’t prepared him for the greatest challenge he will face as Chairman of the Joint Chiefs in the next four years, the economy and its impact on the military. As any good professor he headed to West Point for a course in economics and an understanding of the difficulties he will face balancing the call for less expenditures with the need for national security.

Mike Mullen to Martin Dempsey: A Generational Shift for the Joint Chiefs of Staff

Chuck Hoskinson, Politico. While just five years apart in age the shift from Admiral Mullen to General Dempsey represents a true generational shift in experience. Mullen was the last of the Vietnam experienced Chairmen and Dempsey is the first of the War on Terror leaders. Dempsey has lived the decade of war personally and brings that perspective to the top military adviser role. It will be an interesting change to watch unfold.

Fred Wellman with General Petraeus in Iraq

Fred Wellman, President ScoutComms, brings us his weekly review of defense industry news via The Scout Report. Fred served over twenty years as an Army officer in both aviation and public affairs. You can follow Fred on Twitter @ScoutComms.

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