WASHINGTON — The U.S. Army is girding for modernization program delays and a rise in acquisition costs as the coronavirus pandemic ripples across its installations and through its network of suppliers.
Army leaders told reporters Thursday they are confident the service can juggle schedules to make up for any emerging delays and would ask Congress to help address future cost growth. While some larger prime contractors have adapted quickly, officials said, they warned that lower-tier companies with less slack in their workforces remain vulnerable.
The Army’s Integrated Air and Missile Defense Battle Command System had several major tests and evaluations scheduled, including a long-awaited limited-user test, or LUT. However, Army Futures Command chief Gen. Mike Murray said in a call with reporters that the testing schedule “will slide a little bit, but we will be on time” for the program’s other milestone decisions.
“I am very confident we will get the LUT done this summer or early fall,” he said.
The Army is in the third year of an ambitious modernization overhaul, which depends in part on “soldier touchpoints,” or user evaluations of new equipment. The modernization efforts are now in question as commanders apply physical distancing measures to protect their soldiers.
For example, a touchpoint at Fort Riley, Kansas, for a future replacement of the RQ-7 Shadow unmanned aircraft system is going ahead, but the commander at Fort Campbell, Kentucky, decided to postpone one there.
Whether wider program delays are coming, “we’re still watching very closely, and what I am very much focused on is there may be some slips in key decisions and soldier touchpoints,” Murray said. “The current estimate is we will deliver that [UAS] capability to our soldiers by the time we said we would.”
The Army will also push a critical touchpoint for the Integrated Visual Augmentation System from the summer to the fall after Microsoft — a subcontractor for the prime — temporarily closed. The device is a set of goggles meant to provide soldiers next-level night and thermal vision as well as enhance navigation and targeting.
“Not only for that program but for all our programs, input from the soldiers that were actually asked to use this equipment has been critical,” Murray said. “That has been impacted.”
The comments came as the Pentagon expects a broader three-month delay for major acquisition programs and speeds progress payments to primes that should trickle to small businesses. Army acquisitions officials have worked to help get second- and third-tier suppliers access to small business loans as well as facilitate cash flow to them.
“The supply chain does have some challenges, and that’s probably where the vast majority of any slips would occur that are tied to individual companies,” said Bruce Jette, the Army’s acquisition chief. “These companies are small, and if one person gets COVID in the company, the next thing you know you’ve lost 14 days with the company because everybody that didn’t get it is in quarantine.”
BAE Systems coordinated a temporary closure with the Army and plans to scrap a planned summer break to make up the time. Boeing’s closure in Philadelphia also came and went.
“It’s like that down [the] chain for the primes: They tend to be coming back online,” Jette said. “The ones where we end up with two or three weeks are the ones where we’ve got small individual companies of maybe 20 to 30 people who were suppliers of cables, or connectors and things like that.
“There’s something there that tends to have a bigger impact or take a little bit longer time. And with them, we try to execute those portions of the program which aren’t dependent upon those components, and then we’ll come back and clean up the battlespace.”
Some big agenda items for the Army don’t appear to have been knocked off balance. For example, the Army is still planning on another flight test of Lockheed Martin’s Precision Strike Munition, or PrSM, by April 30, which will deliver a new long-range precision fires capability to the battlefield. The capability is the Army’s No. 1 modernization priority.
“I’m confident enough that we’re going to do the next test flight [of] PrSM that I scheduled a military aircraft to go out and see it, so I’m very confident,” Murray said.
The Army’s latest “night court” review — used to divest the service of unneeded programs — proceeded virtually, as much of the Pentagon shifted to remote work. As part of the review, Army leaders recently received the final brief concerning equipment.
“A lot of the recommendations are pretty much close to being finalized,” Murray said.
Joe Gould was the senior Pentagon reporter for Defense News, covering the intersection of national security policy, politics and the defense industry. He had previously served as Congress reporter.