U.S. Army Contract Awards Put JLTV on Fast Track t
14:34 GMT, August 24, 2012 After suffering a near-death experience on Capitol Hill last year, the Army's Joint Light Tactical Vehicle (JLTV) is starting to look like a program with a bright future. On August 22 the service announced fixed-price contract awards to three industry teams that now must compete for the right to produce the vehicle in an intensive 33-month development process. Any one of the teams could win in the race to produce a successor to the Humvee light truck, because each team is highly capable and brings impressive credentials to the competition.
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Lockheed Martin heads the team with the deepest pockets, which includes the part of BAE Systems that has long assembled Army trucks in Texas. Thus, BAE has managed to stay in the race despite the failure of its primary team to prevail in Wednesday's down-select. Privately-held AM General, the incumbent producer of the Humvee, was another winner -- probably due in no small part to its hiring of former General Dynamics manufacturing guru Charlie Hall as CEO. Hall was instrumental in selling the Army on an upgrade to the Stryker troop carrier that made it nearly impervious to improvised explosive devices.
And then there is the third winner, Oshkosh, which in some ways is the most impressive player on the field. Oshkosh suffered its own near-death experience when the sub-prime financial crisis collapsed demand for its civil and commercial vehicles, but the firm survived by winning back-to-back contracts from the Army for agile mine-protected vehicles needed in Afghanistan and then unseating incumbent BAE Systems in the competition for the final production lot in the Family of Medium Tactical Vehicles. The Army has done significant damage to Oshkosh by prematurely terminating the latter program for reasons unrelated to company performance, but the Wisconsin-based truck maker has proven its commitment to the military market by once again bidding aggressively to win a berth on JLTV.
The failure of the General Dynamics team to prevail in the down-select was foretold when it disclosed several months ago that its entry was not compliant with the height and weight specifications of the solicitation. It took a gamble on offering an off-the-shelf vehicle that was already proven in combat, and the gamble did not pay off. Fortunately for shareholders, it has numerous other opportunities in the armored-vehicle market, including upgrades to Stryker and the Abrams main battle tank, development of a successor to the Army's M113 troop carrier, and finding a replacement for the Expeditionary Fighting Vehicle (which was canceled in a misguided triumph of bean-counting over operational needs).
The most promising aspect of the JLTV program is the way in which the Army has gotten its act together on requirements and acquisition practices. What looked two years ago like yet another case study in poor requirements generation and cost control has turned into a tightly-managed, reasonably-priced effort to equip the ground forces of tomorrow. The Marine Corps deserves some credit for changing Army thinking on the program, but most of the improvement resulted from an internal realization that the Army had to do a better job of managing development programs. With the teams now selected for the next phase of the Joint Light Tactical Vehicle effort, there's a high likelihood that better vehicles will start reaching the force in the near future.