It looks like the U.S. Army's Ground Combat Vehicle (GCV) dodged a fatal budget cut, thanks to a delaying strategy that extends the program's technical development phase by six months while trimming the number of contractors.
The Army's fiscal 2014 budget seeks $592.2 million in R&D funding for the GCV. Budget documents note that combat vehicles, including the GCV, are a top R&D and acquisition priority, second only to network-centric programs such as Nett Warrior.
But analysts think the plan to replace the Bradley Fighting Vehicle will still face trouble if mandatory budget cuts continue next year. A recent congressional report recommends dropping GCV in favor of alternatives that are less costly than the projected $30-40 billion program to develop and build 1,904 tank-like vehicles that can transport a squad of nine soldiers.
The Army awarded two technology demonstration (TD) contracts in August 2011 for a preliminary GCV design, stressing its priorities: threat protection, defensive weaponry, urban and off-road mobility, and its nine-soldier capacity. One TD contract, for $439.7 million, went toLand Systems. The other, for $449.9 million, went to the - team. Work was delayed when the losing SAIC- team, which based its offering on the German Puma infantry fighting vehicle, filed a protest contending errors in evaluation. The protest was disallowed because the Puma did not meet requirements. The Puma was also considered in the Army's analysis of alternatives (AoA) in 2011.
But a Congressional Budget Office (CBO) report on April 2 recommended canceling the GCV and buying the smaller Puma, or revamping Bradleys, as the best way to meet most of the Army's requirements without investing in a long-term program for a new and possibly risky design.
Both contractors challenged the findings, saying the CBO relied on an out-of-date GCV design from the 2011 AoA that is “significantly different” from the vehicles they offer now, says Pete Keating of General Dynamics Land Systems. The Puma carries six passengers, meaning squads would be split into two vehicles, requiring more vehicles and more crewmen to operate them. The AoA “confirmed that there are no existing vehicles that would cost less and meet GCV program requirements,” says Mark Signorelli, BAE's vice president of armored combat systems.
The CBO report estimated the GCV's cost at $29 billion in 2013 dollars over 2014-30. A Marchreport said it would cost $37.9 billion, including $7 billion in R&D, to produce 1,874 vehicles, plus 30 test GCVs.
As the threat of defense cuts loomed, theannounced Jan. 17 that it was modifying the GCV acquisition strategy “to further reduce risk and maintain an affordable program.” The technology development phase, normally 24 months, would be extended six months “to allow industry greater time to refine vehicle designs.” The Army also decided to limit the contractors on the following engineering manufacturing development phase to one.
At a Pentagon press briefing April 10, Defense Secretary Chuck Hagel cited the revised acquisition strategy as an example of cost-cutting weapons program restructuring, noting it “will save over $2 billion in development costs.”
The delay, which some Army officials saw as a way of getting GCV out of the line of fire during fiscal 2013, when sequestration cuts are expected to be the largest, was welcomed by the contracting teams. “This . . . allows us to align our design to the new Army requirements,” said Karl Oskoian, a General Dynamics representative.
Sequestration imposed $42.7 billion in defense spending cuts for the remainder of fiscal 2013.
But the Pentagon's budget woes are not going away with the new fiscal year, says Todd Harrison, an analyst at the Center for Strategic and Budgetary Analysis of Washington. At a briefing before the April 10 rollout of the Defense Department's fiscal 2014 budget request, Harrison noted that political, strategic and economic uncertainty lingers and could result in delays and sequestration in fiscal 2014.
Asked if that meant programs such as the GCV could be vulnerable, Harrison says: “I don't know if it would even get the go-ahead from Congress in fiscal 2014 because the Army hasn't nailed down what they want in the vehicle. If you look at the CBO report this week, it throws a lot of it into question.”