Rapid Fire March 21, 2012: GAO JSF BFF

Mar 21, 2012 08:45 UTC by Defense Industry Daily staff

In advance of a more thorough review, the GAO(Government Accountability Office) published a report listing the various ways the JSF program is late and over budget:

“Cost overruns on the first four annual procurement contracts total more than $1 billion and aircraft deliveries are on average more than one year late. Officials said the government’s share of the cost growth is $672 million; this adds about $11 million on average to the price of each of the 63 aircraft under those contracts.”

These GAO reports will be read closely in Senate where some are not convinced the F-35B should have been taken off probation. Meanwhile Air Force Secretary Michael Donley told the Senate Armed Services Committee (SASC) there was “no more money to put against contract overruns or problems” with the JSF program.

That said, before cutting weapon programs or troops (whether active or reserve duty), some of the same skeptical Senators would rather act on another GAO report that highlighted many inefficient or overlapping initiatives.

The HASC panel on business challenges in the defense industry released its findings [PDF]. They found plenty of challenges indeed, especially for small businesses.

Rheinmetall reached [PDF] 4.45 billion euros in revenue in 2011 (about $5.9B), a 11.6% growth. The order backlog by year end was at 4.95 billion euros, slightly below 2010 and at the same level as year-end 2009. Automotive grew faster than defense and now weighs 51.9% of the group’s total sales, up from 49.7%. The difference was more marked for order intake: whereas there was a perfect 50/50 split in 2010, automotive accounted for 56% of the 2011 orders. The backlog remains 91.7% defense though, which is only natural given the distinct paces of these two industries.

MBDA reported [PDF] 3 billion euros of revenue for 2011 (about $4B) with a 10.5 billion euro order book. The European joint venture is well positioned to get 400 million euros (about $530M) worth of VL Mica and Exocet Block 3 missiles sales in Malaysia, according to La Tribune (in French).

AAR reported 3rd quarter sales of $534.2M, 16.6% growth from the same quarter in the previous year. Government and Defense Services lost 9% “due to unscheduled maintenance inspections and the delayed receipt of several aircraft into the Company’s operating fleet.”

The French DGA procurement agency released its 2012 briefing book [PDF, in French] with short profiles for dozens of defense contractors worldwide.

Categories: Asia - Other, Budgets, Corporate Financials, Daily Rapid Fire, Fighters & Attack, France, Lockheed Martin, MBDA, Small Business, USA

Rapid Fire March 21, 2012: GAO JSF BFF

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