Tomorrow’s Navy’s penny-pinching

Tomorrow’s Navy’s penny-pinching

By Philip Ewing Wednesday, April 13th, 2011 2:56 pm
Posted in Naval

The Department of the Navy is going to get even more serious about cost, performance, schedule and all the other things for which the Pentagon has a bad reputation, two top DoN officials said Wednesday. Reporters asked Undersecretary of the Navy Robert Work at the Navy League’s Sea Air Space show how the department would put its straight talk into effect — new contracting guidelines? Revised RFP practices? No need, Work said: There just won’t be as much money.

“Everyone is competing for a smaller top line,” he said. “Not everything that we want to do we’ll be able to do.” The Navy will reward contractors that demonstrate that they get it, Work said, and for ones that don’t — well, sorry ’bout cha.

“We’re not going to award contracts just because someone’s been building something for a long time,” he said.


Work, along with the Navy’s top acquisition boss, Sean Stackley, said they want contracts to go faster, be cheaper and deliver more. Specifically, multi-year deals will continue to be an acquisition tool of choice, Stackley said, citing the Navy’s Arleigh Burke-class destroyers and its planned TAO(X)-class of oilers as likely candidates to join block-buy legends such as the F/A-18 Super Hornet and the MH-60 Seahawk helicopter.

Coming on the same day as President Obama’s  speech on the deficit, it’s good — or lucky — message management for DoD. But let’s have a quick reality check: America’s defense industry exists because it has the same people who have been building the same things for a long time, in Work’s phrase. The Navy effectively has no choice but to buy destroyers from the new Huntington Ingalls, or General Dynamics; it can only buy aircraft carriers from one shipyard, in Newport News, Va. So for as tough as service officials want to get, they don’t have very many practical options outside the current ecosystem of contractors — and with the flat trajectory of defense spending (at best) that ecosystem is not going to get any bigger.

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Oblat April 13th, 2011 at 3:57 pm

>We’re not going to award contracts just because someone’s been building something for a long time

Can you imagine any other industry where they so openly and brazenly talk about their corruption as if it is perfectly normal. The mafia had more honor than these guys.

BreakTheCycle April 13th, 2011 at 4:25 pm

how can an institution that wants to commit the taxpayers to $260+B more of F-35 stupidity be taken seriously that it is a “penny pinching” institution?? if I wanted to hear some more lies I’d go outside and tell someone to lie to me.

Taxpayer April 13th, 2011 at 4:49 pm

When I first went to work for the Pentagon back in 1982, I made a quick study of the Navy’s top 20 defense contracts. They were whining about not making enough profits based on a return-on-sales perspective compared to their commercial business. They wanted a 2% increase in profits and a 10% increase in progress payments to compensate them,and OSD AT&L had a big team trying to help them out. Instead, I used a return-on-assets approach to show they made substantially more than their commercial business (because they used government property they didn’t need to pay for and didn’t suffer from commercial commodity pricing since the government provided it to them). My analysis was sent to the SECDEF, who bascially cut their profit rate by 1% and cut their progress payments by 5%. Part of my basic argument was that these defense contractors were captive industries to a DoD parent, and their pricing should reflect DoD’s goals, not theirs — the same optimization concept that applies to all major manufacturers versus their subsidiaries.

Ned Conger April 13th, 2011 at 5:59 pm

Mr. Stackley is right on the money when he refers to the “block buy legends such as the Super Hornet.” The F/A-18E/F and EA-18G multiyear 3 contract saved the U.S. taxpayers $605.0M, with even more savings expected from the 41 E/F aircraft added to the program of record in the PB12 budget request.

Aurora April 13th, 2011 at 6:36 pm

Perhaps its time to review the regular CVN deployment cycles? Billions per year digging holes in the ocean . Doesn’t mot of our oil come from the Northern Hemisphere these days?

Aurora April 13th, 2011 at 6:39 pm

Apologies…should read “Doesn’t most of our oil come from the Western Hemisphere these days?”

Byron Skinner April 13th, 2011 at 11:13 pm

Good Evening Folks,

First off welcome Editor Ewing, the fun house.

The Navy is rather is good shape relative to the Air Force and the Army. The only tough nut program that they will have to start in the near future is a Cruiser Program. With the expense of the DD-1000’s this will be a hard sell and they might have a struggle to get all 22 ships they are seeking.

The size of the Marines might be a card the USN will have to play to get it’s cruisers, which I think with the addition of rail guns and enhanced communication suites should be nuclear powered. The Marines with out some addition missions the Army either can’t or don’t want to do and some unique capacities will be hard to sustain at 180 K. The country doesn’t need one and a third Armies.

The Air Force is still trying to find a mission but with the withdrawal of overseas bases back to CONUS the Air Force will have to compete with the Carrier Battle Group, for the role of strategic strike platform, which has been making a rather good show of itself lately.

The Army is still in two wars and it is way to premature to plan any future organization or equipment changes.

ALLONS,
Byron Skinner

William C. April 13th, 2011 at 11:35 pm

DDG-1000 was cut down to three ships. Looks like the Zumwalt class will be more of a technology demonstrator and proof-of-concept rather than our next major destroyer class. The Navy’s next cruiser program appears to be on hold for the time being, but I agree that it probably should be nuclear powered.

The Air Force and Marines both have their role although one can argue the Marines have been used like a second army.

Curt April 14th, 2011 at 3:29 am

You could also argue that the USAF and USN have been used as a third and fourth Army.

C W "Trigger" Miller April 14th, 2011 at 4:24 am

Admiral “We need a 1000 Ship Navy” Mullins needs to be FIRED. He has destroyed NAVAIR with his incompetence. Hiring the President of “Northrop Grumman Ship Building” small conflict of interest. Although I suppose Mullins will be the new poster child for Northrop upon retirement. I suppose the Naval Academy taught him how to be Politically correct. There is no Leadership at the Pentagon. Everyone, there does there time and makes all the correct decisions to pad their new employment with one of the Prime Integrators Ship Yards. Yes, lets purchase a new Stealth Boat. We could accomplish the same mission by strapping a 2000 or 5000 lb bomb to a remote controlled Wave Runner. 19knt afterburnning targets is what is needed these days if you can find someone to weld correctly. They should do away with the Navy and Turn everything over to the Marine Corps.

NotAviator April 14th, 2011 at 1:06 pm

Putting your call sign in your user name sure colors your remarks.

J "AJ" Donnley April 14th, 2011 at 3:13 pm

Chopping Block, shopping list: JSF, F-22, Next Gen Bomber. These three platforms alone would pay off the National Debit in Savings. This is not hard.

William C. April 14th, 2011 at 3:28 pm

I don’t mean to imply we should disband the Marines in anyway. I just fear that they have become too oriented to rather static COIN operations, which really doesn’t fit their traditional role.

William C. April 14th, 2011 at 3:28 pm

Would you stop posting this same nonsense in every topic? You want to leave the USAF with nothing I suppose.

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