Sky Talk

Bell receives pair of Navy contracts worth $15 million

From the list of contracts issued Wednesday by the Department of Defense:

Bell Helicopter Textron, Fort Worth, Texas, was awarded contract W58RGZ-12-G-0001-THBD.  The award is a firm fixed price, sole source contract with a maximum $8,613,657 for blade assemblies.  There are no other locations of performance.  Using military service is Navy.  There was one solicitation with one response.  Type of appropriation is fiscal 2013 Navy Working Capital Funds.  The date of performance completion is April 31, 2014.  The contracting activity is the Defense Logistics Agency Aviation, Philadelphia, Pa. 

Bell Helicopter Textron, Fort Worth, Texas, was awarded contract W58RGZ-12-G-0001-THBE.  The award is a firm fixed price, sole source contract with a maximum $6,563,718 for yoke assemblies.  There are no other locations of performance.  Using military service is Navy.  There was one solicitation with one response.  Type of appropriation is fiscal 2013 Navy Working Capital Funds.  The date of performance completion is Dec. 31, 2016.  The contracting activity is the Defense Logistics Agency Aviation, Philadelphia, Pa.

- Bob Cox

Bell CEO Garrison says budget sequestration "equals devastation"

Count Bell Helicopter Chief Executive John Garrison among those sounding the alarm about the likely consequences for the aerospace and defense industry and its employees if Congress doesn't act by early January to block automatic spending cuts from taking place.

Budget sequestration "in my opinion equals devastation," Garrison said Tuesday at the Aviation and Aerospace Industry Manufacturing Summit being held in Fort Worth.

Sequestration is the legislative term for the process that wil require the federal government to slash $1 trillion or so -- about $100 billion a year -- from projected spending over the next decade.

If Congress can't come to an agreement on new budget and deficit reduction bills.the automatic $100 billion a year in spending cuts are due to go into effect in January. The cuts by law must be distributed equally between defense and non-defense budget items, except entitlements which are exempt.

"it's a horrible way to set policy," Garrison said."It's going to affect engineering. It's going to affect manufacturing. And it's going to have downstream effects" on the companies that supply Bell and other defense contractors.

Defense contractors and industry groups have ringing alarms bells for months about the impact they say sequestration will have on businesses, jobs and the economy.

The initial impact on Bel would likely be small, Garrison said, because the company has contracts and funding on V-22 aircraft and military helicopters through 2015.

"I'd like to believe the federal government isn't going to break contracts and this will be worked out going forward, Garrison said, but it's still a poor way to run the government.

Bell has been given virtually no guidance on how sequestration would be implemented. "The guidance we've been given is what Secretary Panetta said, that sequestration is not something that's going to happen," Garrison said after his speech.

In the meantime, Bell is working with the hope and as if the political issues will be resolved. "We're continuing to sign contracts" with DoD and the military, Garrison said. "We're continuing to negotiate as Bell-Boeing on the V-22 multi-year contract."

-Bob Cox

 

Air Force didn't welcome CV-22 crash investigator's persistence

Without further comment here's an interesting piece at Wired's Danger Room on the reaction an Air Force general received from his superiors for pushing his investigation into the April 2010 crash of a CV-22 in Afghanistan that killed four people.

What (Donald) Harvel discovered about the controversial hybrid aircraft drew him into a battle of wills with his superiors at Air Force Special Operations Command. Harvel, then a brigadier general, uncovered evidence of mechanical problems — and resulting safety woes — in the V-22 Osprey, which takes off like a helicopter and flies like an airplane. These are issues the Pentagon has been eager to downplay. So when Harvel refused to alter his findings to match the Defense Department’s expectations, he knew that was the final chapter of his decades-long military service. Harvel’s long-planned retirement was held up for more than two years, effectively silencing him during a troubling chapter in the Osprey’s often-troubled history.

“I turned [my report] in and I knew that my career was done,” Harvel says.

Harvel’s retirement paperwork finally cleared a few weeks ago. Now, the former Texas Air National Guard C-130 pilot is free to publicly share his opinion about the Osprey: that it’s “just not quite there yet.” The two crashes and another incident this year are proof of that.

“We need to invest money to fix this thing or change the way we’re operating it,” Harvel says. But the Pentagon has other priorities, he adds. “One of the things that is most noticeable to me is the military trying to get the [Air Force] CV- and [Marine] MV-22 to the forefront to get as much positive publicity as possible.”

- Bob Cox

 

 

 

 

 

GOP senators to Obama: No dollars to pay for defense firms sequestration WARN Act costs

As we reported yesterday, Lockheed Martin and other defense contractors have said they will not issue notices to employees warning of possible layoffs due to the possibility of across the board budget cuts in January.

The about face came after the Obama administration, which really doesn't want layoff notices going out days before the election, assured the companies that if budget cuts do hit programs and they do have to lay off workers they could bill the government for costs they incurred due to WARN Act violations.

Now Politico.com (paid site) reports the Republican pols prompt response.

MCCAIN AND GRAHAM: NOT ONE PENNY FOR CONTRACTOR LAYOFFS: Sen. Lindsey Graham (R-S.C.) tells POLITICO he'd oppose paying even a cent of defense vendors' legal or employee costs if they were forced to lay off workers next year under a potential sequester. Contractors "fail to issue [layoff] notices at their own peril," the influential SASC member said. Meanwhile Sen. John McCain (R-Ariz.) is expected to announce this morning that he's told DoD he would block the transfer of funds to reimburse vendors' costs in a layoff or legal situation, and wants 30 days' notice from DoD before it actually got to the point of attempting payment.

Graham was peeved: "I hope they get sued and there will be absolutely no way Congress will reimburse any contractor one penny if they find themselves in litigation. By not issuing the notices, they're on their own," he added. The OMB has said that the administration would cover the costs involved if sequester forces them to close plants and lay off employees and they are exposed to WARN Act liability.

Meanwhile, EADS, parent company of American Eurocopter in Grand Prairie, follows the lead of Lockheed and others and says it won't issues WARN Act notices:

EADS BACKS OFF LAYOFF WARNINGS: EADS North America joined Lockheed Martin and BAE Systems on Tuesday, telling POLITICO it too no longer plans to issue the WARN Act notices it once mused about sending employees in anticipation of sequestration. "We have no intention at this point of issuing notices this year," EADS spokesman Guy Hicks said. "If sequestration occurs and it becomes clear that our operations would be impacted as a result, then we would go ahead and issue WARN Act notices."

- Bob Cox

 

 

Lockheed: No layoff warnings will be sent to employees pre-election

With a U.S. government promise in hand that it will pick up any extra bills that it might incur, Lockheed Martin now says it won't be sending layoff warning notices to employees prior to the Nov. 6 election.

Facing the likelihood of mandatory budget cuts going into effect after Jan. 1, Lockheed and other defense contractors had been threatening to send out WARN Act notices about Nov. 1 to tell employees they could be in danger of being laid off due to budget cuts.

Now Bloomberg News reports that the Obama administration, which did not want a flood of layoff notices arriving in mailboxes before election day, has given the defense contractors assurances the U.S. government will pick up the tab for any legal and compensation costs they incur if they face WARN Act penalties as a result of budget sequestration induced layoffs.

Federal law requires most employers with 100 or more workers to give 60 days’ notice of plant closings or “mass layoffs” -- labor cutbacks affecting 500 or more workers, or at least 33 percent of the workforce for companies with fewer than 500 employees.

Richard Ginman, the Defense Department’s director of defense procurement and acquisition policy, wrote an industry group on Sept. 28 that “any action to adjust funding levels would likely occur, if it occurred at all, several months after sequestration.” The same day, the Office of Management and Budget said the government will cover legal and compensation costs if contractors are held liable in court for not giving enough notice.

The guidance “ensures that, if contract actions due to sequestration were to occur, our employees would be provided the protection of the WARN Act and that the costs of this protection would be allowable and recoverable,” Lockheed said in the statement.

Barring last minute Congressional act, federal law now prescribes mandatory, across-the-board cutbacks of $1 billion-plus over 10 years from federal discretionary spending after Jan.1, 2013, half of it from defense. That would result in about a $50 billion a year hit to Pentagon spending.

- Bob Cox

 

End of the year nears, Pentagon spends the bucks

A string of Fort Worth and Dallas area defense contracts issued today by the Department of Defense as the fiscal year draws to an end on Sept. 30.

For the F-35 program:

 Lockheed Martin Corp., Lockheed Martin Aeronautics Co., Fort Worth, Texas, is being awarded a $79,930,653 not-to-exceed modification to a previously awarded advance acquisition contract (N00019-10-C-0002) for the manufacture and delivery of six F-35 Lightning II Full Mission Simulators  In addition, this modification provides for a radar upgrade at Hill Air Force Base in support of F-35 radar cross section testing.  Work will be performed in Fort Worth, Texas (35 percent); El Segundo, Calif. (25 percent); Warton, United Kingdom (20 percent); Orlando, Fla. (10 percent); Nashua, N.H. (5 percent); and Baltimore, Md. (5 percent), and is expected to be completed in April 2015.  Contract funds in the amount of $716,700 will expire at the end of the current fiscal year.  The Naval Air Systems Command, Patuxent River, Md., is the contracting activity. 

And this one:

Lockheed Martin Corp., Lockheed Martin Aeronautics Co., Fort Worth, Texas, is being awarded a $25,900,000 modification to a previously awarded cost-plus-incentive-fee contract (N00019-08-C-0028) for incorporation of government-authorized concurrency changes for F-35 Low Rate Initial Production (LRIP) Lot III Conventional Take-Off and Landing (CTOL) aircraft for the Air Force.  Concurrency changes are changes to the LRIP Lot III configuration baseline hardware or software resulting from the F-35 development effort.  Work will be performed in Fort Worth, Texas, and is expected to span multiple years.  Contract funds will not expire at the end of the current fiscal year.  The Naval Air Systems Command, Patuxent River, Md. is the contracting activity. 

And for the F-22 program:

    Lockheed Martin Corp., Fort Worth, Texas (FA8611-08-C-2897, P00158), is being awarded a $10,353,574 contract modification for support of the F-22 program.  The locations of the performance are Marietta, Ga., Fort Worth, Texas, Seattle, Wash., Edwards Air Force Base, Calif., Elmendorf Air Force Base, Ark., Hickam Air Force Base, Hawaii, Holloman Air Force Base, N.M., Langley Air Force Base, Va., Nellis Air Force Base, Nev., Sheppard Air Force Base, Texas, Tinker Air Force Base, Okla., and Tyndall Air Force Base, Fla.  Work is expected to be completed by Dec. 31, 2012.  The contracting activity is AFLCMC/WWUK, Wright-Patterson AFB, Ohio. \

For the V-22 program:

Bell Boeing Joint Project Office, Amarillo, Texas, is being awarded an $8,805,089 modification to a previously awarded fixed-price-incentive-fee, firm-target V-22 multi-year production contract (N00019-07-C-0001) to procure recurring engineering associated with the production incorporation of the seven Lot 15 and seven Lot 16 MV-22 aircraft with the HMX-1 paint scheme.  The HMX-1 paint scheme effort includes outfitting associated with logistics support and painting of the aircraft.  Work will be performed in Fort Worth, Texas (98 percent), and Philadelphia, Pa. (2 percent), and is expected to be completed in November 2014.  Contract funds will not expire at the end of the current fiscal year.  The Naval Air Systems Command, Patuxent River, Md. is the contracting activity. 

And F/A-18 simulators:

 L-3 Communications Corp., Link Simulation & Training Division, Arlington, Texas, is being awarded a $46,000,245 firm-fixed-price delivery order against a previously issued Basic Ordering Agreement (N61340-12-G-0001) for the procurement of high definition visual systems for 23 F/A-18 and EA-18G Tactical Operational Flight Trainers (TOFTs).  In addition, this order provides for installation of two government-owned F/A-18E/F TOFTs at the Naval Air Facility Atsugi, Japan.  Work will be performed in Arlington, Texas (92 percent), and Atsugi, Japan  (8 percent), and is expected to be completed in May 2015.  Contract funds will not expire at the end of the current fiscal year.  The Naval Air Warfare Center Training Systems Division, Orlando, Fla., is the contracting activity. 

Sensor system spares for the Navy:

 Raytheon Co., McKinney, Texas, is being awarded a $9,690,362 firm-fixed-price contract for Multi-Spectral Targeting System spares for use in airborne, electro-optic, forward-looking infra-red, turreted sensor system that provides long-range surveillance, high altitude target acquisition, tracking, range-finding, and laser designation, and for all tri-service and NATO laser guided munitions.  Work will be performed in McKinney, Texas, and is expected to be completed by December 2013.  Contract funds in the amount of $1,191,150 will expire at the end of the current fiscal year.  This job order is under an existing Basic Ordering Agreement and was awarded on a sole source basis in accordance with the statutory authority of 10 USC 2304(c) (1) as implemented by FAR 6.302-1.  The Naval Surface Warfare Center, Crane, Ind., is the contracting activity (N00164-12-G-JQ66). 

Boeing too:

  The Boeing Co., Seattle, Wash., is being awarded a $34,555,298 firm-fixed-price modification to a previously awarded fixed-price-incentive-fee contract (N00019-09-C-0022) to procure additional spares for the P-8A multi-mission maritime Low Rate Initial Production III aircraft.  Work will be performed in Dallas, Texas (59 percent); Greenlawn, N.Y. (13 percent); Amityville, N.Y. (8 percent); Seattle, Wash. (7 percent); Rancho Santa Margarita, Calif. (6 percent); Anaheim, Calf. (4 percent); Irvine, Calif. (2 percent); and El Paso, Texas (1 percent); and is expected to be completed in September 2015.  Contract funds will not expire at the end of the current fiscal year.  The Naval Air Systems Command, Patuxent River, Md., is the contracting activity

Bell Helicopter honors employees for innovation

Bell Helicopter has announced that 18 employees have been awarded the 2012 Lawrence D. Bell Pioneer Award for innovation leadership.

Four teams of Bell employees that received the award to the final round of the competition for the Textron Chairman’s Award for Innovation. The awards are given to employees "whose exemplary innovations have led to significant improvements and directly contributed to Textron’s growth, globalization, profitability or competitive position," Bell said in a release.

Winning team innovation projects include:

Productivity: “Large Cell Composite Core for Next Generation Structure” – Donn Hethcock, Paul Oldroyd, Suvankar Mishra, John McCullough and Michael Mackey

Service: “Longer Life TT-Strap for Bell 206 Operators” – Tom Reilly, Warren Moseley, Daniel Sottiaux, Carlo Capozzo and Joshua Mochache

Innovation: “Bell 525 Relentless Cockpit Control System” – Brad Linton, Travis Yates and Chad Haugeberg

Growth: “407GX” – Clive Davis, Elvis Luis, Tuan Bui, Jonathan Williams and Gordon Mooney

 “We are very proud of our Pioneer Award winners. Without forward-thinking, brilliant minds like these, Bell Helicopter would not be the industry-leader we are today,” said John Garrison, chief executive officer of Bell Helicopter.

- Bob Cox

Triumph Aero in lease negotiations over Dallas plant

Triumph Aerostructures is in negotiations with a Dallas company on a new lease covering its west Dallas manufacturing facilities.

Triumph spokeswoman Lynne Warne said in an email Tuesday that “we are still in negotiations” with American Brownfield “and are hoping for a resolution,” but could not comment further.

Robert Riggs, spokesman for American Brownfields, acknowledged that negotiations were continuing and said that a proposal had been submitted to Triumph for a one-year lease extension under the same terms as Triumph’s prior lease with the Navy.

American Brownfields, headed by real estate investor Stuart Jones of Dallas, has agreed to pay the U.S. government $375,515 for the 1940s vintage aircraft manufacturing plant long occupied by Vought Aircraft Industries and its predecessor companies.

As part of the property sale, which Riggs said has not yet been completed, American Brownfields has agreed to assume responsibility for the costs of cleaning up polluted soils and water around the 425 acre property, problems that in some cases date back to World War II when North American Aviation first operated the plant.

Triumph, which employs about 2,400 salaried and hourly workers at the Dallas plant, said last month that the lease terms proposed by American Brownfields would effectively double the company’s annual cost of operating the 5-million square-foot manufacturing and assembly plant.

Triumph has said it will begin planning to move operations out of the facility if it cannot get more favorable lease terms than those initially proposed by Jones.

Major components for the Boeing C-17, Bell-Boeing V-22 Osprey, Northrop Grumman Global Hawk, Sikorsky UH-60 Black Hawk helicopters and Gulfstream G550 business jets are built at the plant.

- Bob Cox

Marines say pilot error caused V-22 crash in Morocco that killed 2

BTW, as a followup to this post. Credible sources close to Bell Helicopter say this problem was recognized years ago with BA609 civil tilt-rotor aircraft and the software was rewritten to prevent this type of accident from occurring.

-BC

 This just in from the Associated Press:

A Marine Corps investigation has concluded that operator error caused the deadly April crash of an MV-22 Osprey aircraft in Morocco — an incident that has fueled unease in Japan, where the hybrid aircraft are being deployed.

In a report obtained Thursday by The Associated Press, the Marine Corps ruled out mechanical and safety problems with the tilt-rotor Osprey, which takes off like a helicopter and flies like an airplane. The report said high winds and failure to follow proper flight procedures were two significant factors in the crash.

Two Marines were killed and two others severely injured when the Osprey crashed during a training exercise in Morocco. The investigation found that there was no misconduct or intentional neglect on the part of the Marines.

According to the report, the Osprey was taking off into a heavy headwind and, in an effort to avoid flying over some tents that were set up for the exercise, the co-pilot made a 180 degree turn, lost control and crashed from a height of about 46 feet. The report said that "lack of understanding of the true wind speed" was a factor in the crash.

The investigation also recommended that the flight field manuals be updated to include more detailed information about how to best transition from the helicopter-like take off to the regular aircraft flight when there is a tail wind.

Ed. Note:  The 2005 version of the NATOPS manual for the MV-22 was about 1,200 pages long. Then there was the 92 page pocket "procedures" manual; and the 144-page pocket "emergency procedures" manual. 

- Bob Cox 

More defense dollars equals fewer defense industry jobs

That's one quick conclusion of this report out today by the Project On Government Oversight, which looks at the Armageddon-like rhetoric emanating from the defense industry and Congress over the prospect of looming budget cuts.

According to the Congressional Budget Office, if the sequestration axe falls, the Department of Defense's base budget would still be larger than it was in 2006 (adjusting for inflation).

And, at the end of 2006, according to an analysis by the Project On Government Oversight, the nation’s five top defense contractors employed more people than they did at the end of 2011.

At the end of 2006, the five companies employed a total of 577,200 people, according to reports they filed with the Securities and Exchange Commission. That was slightly more than the 520,900 they reported at the end of 2011.

The POGO study included Lockheed Martin, Boeing, General Dynamics, Northrop Grumman, and Raytheon.

To be sure, there are wrinkles in the numbers. One big one: Northrop Grumman split from its Huntington Ingalls shipbuilding business in 2011, taking the Huntington Ingalls employees out of the year-end jobs total for the top five contractors. But, adding back those 38,000 employees, the five contractors still employed 3.3 percent more workers at the end of 2006 than at the end of 2011.

Over the five-year period, total employment at the companies declined even as the total federal contract dollars awarded to the firms rose.

- Bob Cox