Top Senators Express Dismay Over Latest F-35 Deal

The 2012 U.S. defense authorization bill includes tighter cost controls for the next F-35 Joint Strike Fighter (JSF) purchase, but the legislation comes too late to influence a contract the Defense Department awarded days earlier.

SENS. CARL LEVIN, left, and John McCain both were unhappy with the Pentagon’s latest F-35 purchase from Lockheed Martin. (File photo / Getty Images)

The Pentagon announced Dec. 9 thatit had awarded Lockheed Martin a $4 billion contract to build the fifth low-rate production lot of 30 F-35s for the Air Force, Navy and Marine Corps.

That happened as lawmakers from the House and Senate were negotiating the final language for the 2012 defense authorization bill, including a Senate amendment that would have prohibited the use of a cost-plus contract for lot 5.

Those negotiations concluded Dec. 12 and the legislation could be voted on in the House as early as Dec. 14, according to House Armed Services Committee Chairman Rep. Buck McKeon, R-Calif.

The authorization bill no longer contains language on the Lot 5 buy, but it now calls for a "no cost-plus contract" on Lot 6, according to Sen. Carl Levin, D-Mich., chairman of the Senate Armed Services Committee.

"They've escaped what we think is a very necessary control on cost," Levin said at a Dec. 9 news conference with McKeon; Sen. John McCain, R-Ariz., the ranking Republican on the Senate Armed Services Committee; and Rep. Adam Smith, D-Wash., the ranking Democrat on the House Armed Services Committee.

Levin expressed his displeasure with the Pentagon for moving ahead with the buy while Congress was still in negotiations.

"Frankly … we took umbrage at the idea that the Air Force, the acquisition folks, would sign a contract for Lot 5 in the face of a Senate provision saying, 'We want no cost-plus contract on Lot 5,' " he said.

Because the Senate provision has not become law, the Pentagon could do it. "But frankly," Levin said, "I'll be calling in these acquisition folks, and I know Senator McCain will be right there at my side."

While the contract used for Lot 5 is not being called a cost-plus contract, it contains too many caveats and loopholes that allow cost increases to be picked up by the government, McCain said.

According to the Pentagon announcement, the contract is a "fixed-price-incentive [firm target]" contract, also known as a FPIF.

"All efforts will be contracted for on a FPIF basis, with the exception of work scope for the incorporation of certain specified concurrency changes that will be contracted for on a cost-sharing/no-fee basis," the DoD announcement reads.

Said McCain: "One would assume that a fixed-cost contract wouldn't allow any additional costs. That's not true anymore. It's become insane."

According to the lawmakers, the bill contains more than 600 different provisions.

The lawmakers presented a united front on the language concerning the treatment of terrorist suspects, urging President Obama not to veto the bill. Obama has threatened to veto the bill over changes on how to handle suspected terrorists.

Levin said the lawmakers added "significant provisions" to provide added reassurance that there would be no interference in civilian interrogations. Smith said Obama "ought to support it and ought to pass it."

Viper Strike Becomes MBDA Inc.'s 1st U.S. Buy

Company leaders were on site in Huntsville, Ala., on Dec. 12 as MBDA Inc., the wholly owned U.S. subsidiary of European missile giant MBDA, had its first business day as owner of the Viper Strike missile program.

Closing the deal to purchase the business from Northrop Grumman at midnight Dec. 9, the acquisition is a first for MBDA Inc., which has been operating in California for more than 20 years but has not had a major production center.

Production of the Viper Strike missile, a 44-pound guided weapon designed to be carried on a variety of platforms including UAVs, at its major manufacturing plant in Huntsville is not expected to be interrupted, the company said.

"This was the first acquisition, but it's not the first time that we had been looking at something," said MBDA Inc. CEO Jerry Agee.

The purchase is part of a strategy dating back two years, Agee said, as MBDA looks to grow its footprint in the U.S., despite the uncertainty surrounding the defense budget.

"When we have a very small market share now, any growth is significant for us," he said.

The first day of operations saw Agee and others touring the Viper Strike production plant.

"The employees here are very positive," Agee said. "I think they see the benefit of being inside a company that really focuses on missiles."

As MBDA Inc. looks to increase its U.S. business and production, Agee said overseas sales would not be a part of the equation.

"Right now, we're absolutely focused on the U.S. market," he said. "We've got a much bigger part of the company that's focused on the international market. We try to let them do their business, and we're focusing on where we've been tasked to grow, which is in the U.S. marketplace."

Japan Picks F-35 as Mainstay Fighter: Reports

TOKYO - Japan has chosen the U.S.-made F-35 stealth jet as its next-generation mainstay fighter in a multibillion-dollar deal, reports said Dec. 13.

The Defense Ministry picked the jet made by Lockheed Martin to replace its aging fleet of F-4 jets over two rivals, the Boeing-made F/A-18 Super Hornet and the Eurofighter Typhoon, the Yomiuri Shimbun said.

Japan's biggest daily said the Defense Ministry had "agreed in principle" to select the F-35, with a formal announcement expected Dec. 16 at the Security Council of Japan, chaired by Prime Minister Yoshihiko Noda.

Kyodo News cited unnamed government sources as saying the ministry had decided to buy 40 F-35 fighters, while the Nikkei business daily said only that the jet remained a "prime candidate."

Earlier reports said Japan could buy as many as 50 new jets, equipped with stealth technology, with a price tag of more than $6 billion.

A Defense Ministry spokesman on Dec. 13 declined to confirm the reports, saying: "We are still trying to do our best to make a final decision by the end of this year."

And Chief Cabinet Secretary Osamu Fujimura denied the reports that a final decision had been made, Dow Jones Newswires said.

The F-35, the most expensive weapons program in Pentagon history, has been plagued by cost overruns and technical delays.

The jet, co-developed with British defense giant BAE Systems, is the most expensive among the three candidates, with a price tag estimated at $113 million per aircraft.

Japan initially aimed to acquire the F-22 stealth fighter to renew its fleet, but U.S. law prohibits exports of the jet because the U.S. has said it would halt production of the model.

Australia Courts 3 Firms for Sub Fleet

SYDNEY - Australia said Dec. 13 it had invited three companies from France, Germany and Spain to submit designs for its new submarine fleet, a project expected to span the next 30 years.

Defence Minister Stephen Smith said Canberra had asked French naval defense firm DCNS, Spain's Navantia and HDW of Germany - a ThyssenKrupp subsidiary - to submit designs for the program, which will see 12 new submarines built.

"The Future Submarine Project is a major national undertaking and is of a scale, complexity and duration never before experienced within (the) Defence (Department)," Smith said, adding that Australia would need a "significant amount of help from overseas."

"The submarines will be constructed over the course of the next three decades."

Jason Clare, minister for defence materiel, said the Future Submarines Project would involve hundreds of companies, thousands of workers and many skills that "do not currently exist in sufficient numbers."

"Some of those skills are available overseas, others will have to be grown here. Now is the time to develop a plan to make sure we have the skills we need when we start designing and building the submarines," he said.

Australia unveiled plans in 2009 to spend more than $70 billion boosting its military capability over the next 20 years.

Kiowa Training Crashes Kill 4 U.S. Soldiers

LOS ANGELES - Two military helicopters crashed while on a training mission late Dec. 12 in Washington state, claiming the lives of four Army aviators, military officials said.

The cause of the crashes at a training area southwest of Joint Base Lewis-McChord is being investigated, said base spokesman Lt. Col. Gary Dangerfield.

"We will conduct a thorough investigation," he said. "We will do everything in our power to support the families of the brave soldiers who died this evening."

Weather is not believed to have been a factor in the accident, as skies were clear when the two OH-58 Kiowa choppers went down.

China Eyes Navy Stop in Seychelles

BEIJING - China has said it may use the Seychelles as a naval supply stop while conducting anti-piracy missions, at the invitation of the Indian Ocean island state.

The announcement comes at a time of growing Indian concern about China's influence in the strategically important Indian Ocean, a vital shipping lane connecting Asia to Europe and the Middle East.

"According to escort needs and the needs of other long-distance missions, China will consider taking supplies or recuperating at appropriate ports in the Seychelles and other countries," the defense ministry said in a statement Dec. 12. The invitation was extended earlier this month during a visit to the Seychelles by Chinese Defense Minister Liang Guanglie.

Beijing has funded or plans to invest in several major infrastructure projects in the Indian Ocean, including ports in Sri Lanka, Bangladesh and Myanmar.

Reports in China's state-run media quoted military experts as saying the move did not equate to establishing an overseas military base.

China has been heavily involved in anti-piracy missions in the Gulf of Aden off the coast of Somalia and in the Indian Ocean.

Since 2008, China has sent 10 escort missions and more than 8,000 military personnel to the Gulf of Aden, escorting more than 4,300 vessels in the process, the official China Daily said.

U.S. Air Force Orders Single Predator C Avenger

The U.S. Air Force is buying a single General Atomics Predator C Avenger jet-powered unmanned combat aircraft, the service said in a document posted on the Federal Business Opportunities website on Dec. 9.

According to the heavily redacted document, Lt. Gen. Thomas Owen, commander of the service's Aeronautical Systems Center at Wright-Patterson Air Force Base, Ohio, approved the procurement. The value of the sole-source contract was redacted.

The document states that the partially stealthy aircraft will be used in Afghanistan as part of Operation Enduring Freedom. The Predator C is faster, has better sensor capacity and carries a greater payload than the existing MQ-9 Reaper unmanned combat aircraft. The Predator C also has an internal weapons bay and four external hard points, and it is capable of carrying 2,000-pound weapons. The aircraft is compatible with the Reaper's ground control station, the document said.

"This aircraft will act as the test vehicle to develop those next generation UAS [Unmanned Aircraft System] sensors, weapons, and Tactics, Techniques & Procedures (TTPs) ensuring a quick, smooth and efficient fielding of these advanced capabilities to the area of operations," the document said. "Currently, the combatant commanders, with the SECDEF's concurrence, have determined there are insufficient assets in-theater today to gather the necessary information and to fully engage the present threat."

Buying General Atomics' privately funded Predator C aircraft will help the Air Force prepare for current and next generation threats, the document said.

"This effort is an exceptional circumstance not only due to the need outlined by the SAF/AQ [Assistant Secretary of the Air Force (Acquisition)] but because it fulfills a multi-agency role by providing a test platform for both Office of Secretary of Defense (OSD) and customers under an ongoing, classified SECDEF directed program," the document stated.

The aircraft is being procured for classified "customer" who needs the jet urgently. The Predator C was apparently the only aircraft that could fill the Defense Department's needs on such short notice.

Flight International first reported the procurement on Dec. 12.