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Viability of industrial base concern for Army aviation

By C. Todd Lopez

WASHINGTON (Jan. 11, 2013) -- With already declining budgets, a potential sequester later this year, and a difficult economy, sustaining the industrial base that provides the Army with aircraft and aviation logistics support is a complex problem.

One area of concern, for example, is with suppliers of critical aviation safety equipment. Suppliers of that type of equipment undergo extensive, and expensive certification before being allowed to sell to the Army -- so they are valuable partners to the Army aviation community, leaders said. They voiced concerns today during the Association of the U.S. Army's annual Aviation Symposium.

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With a force drawdown coming in Afghanistan, there will be a lower operations tempo for the Army, and that means Army aviation will use less supplies than it had before. A stock supply of equipment and parts that during a high operations tempo might have lasted the Army only six months, might instead last two years during a period with a lower operations tempo. That could mean problems for suppliers, said Maj. Gen. Lynn A. Collyar, U.S. Army Aviation and Missile Command.

"How do I keep the small manufacturer in business as I draw (on) that two years of stock? How do I draw that down and still buy enough from the manufacturers to keep them economically viable?" he said.

Collyar suggested that if the Army can show manufacturers what the force has in stock, and can also show usage rates, manufacturers might be better equipped to manage raw material purchases, for instance. That could lower operational costs for them, and in turn decrease what the Army must buy to keep a manufacturer viable.

"It really comes down to partnering," Collyar said.

Opening up military sales to foreign nations is also a possibility for helping ensure America's industrial base weathers tough economic times, said Maj. Gen. William T. Crosby, Program Executive Office Aviation.

While the general said there are some areas where technology transfer is a security issue, the U.S. does have good partnerships with both European and Pacific nations. In those places, foreign military sales can help sustain the industrial base back home while at the same time help the Army get even better equipment, he said.

"When we slow down production, to maintain and sustain that industrial base, it behooves us to help our original equipment manufacturers partner with those customers. And sometimes, by nature of when they come in to procure something, they can procure an upgrade we are unable to afford," Crosby said. "Not only does that keep the production line warm, it is then something that can flow over into our side."

Taking care of financial business in-house is also a priority for the Army aviation community. Collyar cited as an example of possible cost overages the number of T-700 engines now in depot repair.

Today, he said, the Army has about $5 billion worth of those engines on operational aircraft -- "on wings today," Collyar said. But another $2.5 billion of those engines are in supply depots or maintenance depots or in transit -- a significant dollar amount of engines that are not currently inside an operational aircraft.

"(Of) items getting back to depot for repair, about 50 percent of those that are received should never go back to that level. They should have been repaired forward," Collyar said. "If we fixed them in the right place, there's a significant savings to be had."

The general cited both shipping costs and administrative costs as two places where savings could be found if T-700 engines were being repaired at the lowest level possible.

New systems procurement is also an issue in an austere fiscal environment. Collyar said that an often-cited statistic is that 30 percent of the cost of a system is procurement, while 70 percent is sustainment through its lifecycle. But that statistic is really for systems with an expected 20-year lifecycle. But Collyar said many Army systems are actually 30-to-50-year systems now. As the Army has kept platforms longer, the percentage may change to 20/80 or 10/90.

With longer-term systems, Collyar said the Army must plan upfront, at procurement time, for systems that will last longer. The Army may have to spend a little more today and not take shortcuts in procurement, he said, to keep down the cost in the future of maintaining a system that may be in service for as much as half a century.

"Knowing that a platform is going to be there for 20 or 30 years, is that the same platform we need today that we are going to need 30 years from now?" he asked.

Planning will make it possible to have a basic platform be the same 30 years from now, but look and fly different, he said. The Army must plan at procurement time for long-term sustainment. One example, he said, is to ensure that systems built today are developed in a way that allows them to be upgraded in the future at lower cost. He also said condition-based maintenance will allow the Army to maintain systems for less money.

Crosby said that with systems in the Army today, ensuring future sustainment is a problem, in particular with "technology insertion," or keeping those systems technologically up-to-date into the future.

With systems like Chinook, Black Hawk and Combat Shadow, for instance, he said sustainment is a challenge.

"The challenge we have is how do we keep those platforms viable ... so far as technology insertion," he said. "The platform is what we have, but how do we insert these new technologies?"

In particular, he cited sensors as an example of the kind of technology that will continue to evolve, and which must be continually added to systems as they reach maturity.

"We can't continue to strap on tools," he said. "We've got to find a way with these digitized platforms to integrate those systems and upgrade them without re-designing them."

At the same time, Crosby said, the Army must be cognizant of weight when upgrading and integrating systems -- weight, he said, decreases aircraft performance.

Crosby also addressed the Armed Aerial Scout program, acknowledging that industry is "chomping at the bit" for answers on how the program will move forward and an Armed Aerial Scout competition. But he cautioned that with budget constraints, Army leaders will need time to make the right call.

"The Army wants to make some tough decisions. It's not as simple as do you do a competition. It's not as simple as what the competition will be. There are so many aspects that have to go into that decision that our senior leaders are wrestling with," he said. "It's much bigger than Army aviation. They're looking at the future of our Army. Let's don't rush and compel and force people into a decision that we are going to have to change in six months or a year."

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