By Roxana Tiron - 03/27/07 06:54 PM EDT
The service’s new approach comes after much congressional prodding. At Congress’s behest, the Army submitted a plan for entering multiyear procurement for the M1A2 Abrams tank, built by General Dynamics Land Systems, and the M2A3 Bradley Fighting vehicle, built by BAE Systems at least through fiscal year 2013.
Committing money to a multiyear contract would allow suppliers to buy components in large quantities to reduce overall program costs.
In the 2007 defense authorization bill, House lawmakers expressed concern that the Army’s procurement strategy would not fund adequately the M1A2 Abrams tank and Bradley A3 modernization programs. As a consequence, defense authorizers asked the secretary of the Army to submit a report on the feasibility and rationale of multiyear procurement.
The Army wants to enter the multiyear contract for both programs as early as 2008, but those plans hinge in part on funds anticipated in the 2007 and 2008 emergency supplemental requests.
However, the Army’s acquisition executive, Claude Bolton, said in a prepared statement to the House Armed Services Committee that the Army would “most likely” request multiyear procurement authority in its fiscal year 2009 budget request.
If the Army can fund a multiyear contract starting in 2008, it would do so at the beginning of the third quarter of 2008 for a period of five years for the Abrams tank and for a period of four years for the Bradley.
The Army estimates the plan would save $178 million (or $300,000 per tank) for the Abrams and $131 million (or $135,000 per vehicle) for the Bradley.
Under the multiyear procurement scheme, the Army would buy 577 tanks and 965 Bradleys, Bolton said.
The multiyear procurement idea could be good news to the industry because it helps to stabilize the workload and keep production lines and employment steady at several depots and at the companies’ facilities.
Rep. Neil Abercrombie (D-Hawaii), chairman of the air and land forces subcommittee, urged the Army to work with authorizers and appropriators to move funding requests in the regular 2008 budget, because the politics of the 2007 supplemental may delay its enactment until September. President Bush has threatened to veto any supplemental coming out of Congress with language to withdraw troops from Iraq and include additional spending not requested by the administration.
Abercrombie has attacked the Army’s request for funds for the Abrams and Bradley modernization programs, arguing that those requests go beyond replacing combat losses.
The Army likely will have to make strong cases for its programs this time around, especially for its much-coveted Future Combat Systems. Abercrombie said during a hearing yesterday that Congress will be hard-pressed to fund several urgent priorities, such as more than $13 billion a year to reset and repair equipment, $11 billion in Army unfunded requirements for 2008 and a permanent increase in the number of active-duty soldiers.
“What assurances can you make that you can afford the FCS on top of these priorities?” Abercrombie asked Army officials.
Abercrombie’s query came after the Army — equipped with an FCS technologies demo — tried to make a case for preserving the full funding request for the program in 2008.
Bolton said the Army will have to look at ways to prioritize the ambitious program, which comprises a complex network of manned and unmanned vehicles. He said that the Army could find ways to accelerate the program’s implementation to save more money.
The FCS weathered about $800 million in cuts during the past three years and has undergone several adjustments.
The director of acquisition and sourcing management at the Government Accountability Office, Paul Francis, said the Army has little knowledge of the FCS’s chances of success.
“While the Army has also made progress, what it still lacks in knowledge raises doubts about the soundness of the FCS business case,” he said. About four years into the program, the Army has yet to fully define FCS requirements while technologies that should have been mature in 2003 are still immature, he added.
Key testing to demonstrate FCS performance as well as the maturity of the designs will not take place until 2013, at the earliest. Meanwhile, an independent cost estimate from the Office of the Secretary of Defense places the cost of the program between $203 billion and $234 billion, a much higher estimate than the Army’s.
Some defense authorizers are concerned that Congress will pour money into a program that may fail. Rep. Solomon Ortiz (D-Texas) expressed concern that it will take more time and money for the Army to determine whether the FCS will work.
“I have seen money going down the drain,” he said, referring to several failed programs, in particular the Comanche helicopter program.
“I still have my doubts, because I have been burnt,” Ortiz said.