{"id":54230,"date":"2015-09-11T19:47:23","date_gmt":"2015-09-11T19:47:23","guid":{"rendered":"https:\/\/one.sightlinemg.com\/defensenews\/uncategorized\/2015\/09\/11\/bae-lockheed-protest-army-contract-awards-on-same-day\/"},"modified":"2026-08-07T23:58:20","modified_gmt":"2026-08-07T23:58:20","slug":"bae-lockheed-protest-army-contract-awards-on-same-day","status":"publish","type":"post","link":"https:\/\/one.sightlinemg.com\/defensenews\/industry\/2015\/09\/11\/bae-lockheed-protest-army-contract-awards-on-same-day\/","title":{"rendered":"BAE, Lockheed Protest Army Contract Awards On Same Day"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">WASHINGTON \u2014 Two major defense companies,\u00a0Lockheed Martin and BAE Systems,\u00a0filed protests of major US Army contract awards with the Government Accountability Office on the same day last week.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Lockheed protested the Army&#8217;s contract award to Oshkosh to build its Humvee replacement, the Joint Light Tactical Vehicle (JLTV), and BAE protested the Army&#8217;s decision to award Northrop Grumman a contract to build the Common Infrared Countermeasure (CIRCM)\u00a0system, intended to protect aircraft from infrared-guided missiles.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Oshkosh beat out both Humvee-maker AM General and Lockheed for the $6.7 billion low-rate initial production contract award to build 16,901 vehicles, but the entire contract is expected to be worth up to $30 billion.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">&#8220;Lockheed Martin does not take protests lightly, but we are protesting to address our concerns regarding the evaluation of Lockheed Martin&#8217;s offer,&#8221; it said.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">AM General, which submitted its Blast Resistant Vehicle-Offroad as its bid, has decided not to file a protest, saying: &#8220;We believe a protest would ultimately result in a distraction from our current growth business areas, including meeting the significant current and future needs of our customers in the United States and around the world.&#8221;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Analysts were not surprised Lockheed protested the JLTV contract award.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">&#8220;One, they are probably incensed they didn&#8217;t get whatever they thought they were entitled to. Second, if they piss off the Army it just doesn&#8217;t matter,&#8221; said Jim Hasik, a nonresident senior fellow at the Atlantic Council&#8217;s Brent Scowcroft Center on International Security.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">James Tinsley, managing director at Avascent, echoed the sentiment. &#8220;They really have nothing to lose and everything to gain by filing a protest,&#8221; he said. &#8220;They have to show their political backers they are doing everything they can to win the contract &#8230; and they have a fiduciary responsibility to their shareholders to show that they did everything they could.&#8221;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">While AM General is a private, equity-owned business, a public company like Lockheed would be more driven to file a protest to show investors it tried, Tinsley explained.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Although there was widespread speculation that AM General would protest because the contract is so important to it, it&#8217;s also not surprising the company decided against it.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">AM General is not low on cash flow, Hasik noted. For example, the company announced Sept. 8 that it had secured a six-year, $428.3 million contract to provide the Army with M997A3 HMMWV-configured ambulances for domestic disaster relief by the Army, Army Reserve and Army National Guard. The company also builds Humvees for other countries around the world, including Mexico.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">AM General also is looking toward the possibility of further US Army Humvee business as the service&#8217;s Humvee fleet likely won&#8217;t consist entirely of JLTVs at about $400,000 a piece, according to Hasik. The Army can&#8217;t afford it, he added.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">&#8220;I suspect the reason they are not protesting is because they have decided the best hope for the company to retain as much business as they can is to be a model corporate citizen and take care of their current customer and not piss off the Army with a protest,&#8221; Hasik said.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">AM General is likely to be a thorn in Oshkosh&#8217;s side for a long time as the Army looks to recapitalize the rest of its Humvee fleet.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">If the Army&#8217;s acquisition strategy for JLTV is solid, Lockheed has little chance of overturning the contract award.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">&#8220;I&#8217;ll be floored and deeply saddened if they find something wrong, not for Oshkosh&#8217;s sake, but for the Army&#8217;s because then I&#8217;ll be convinced that Army acquisition is hopeless,&#8221; Hasik said, adding, the service &#8220;really, really took their time with this competition.&#8221;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">A statement from Oshkosh following Lockheed&#8217;s protest shows confidence in the Army&#8217;s decision.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">&#8220;The U.S. Army conducted a thorough and highly-disciplined evaluation for the JLTV production program to reach a clear conclusion.&#8221;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">BAE&#8217;s protest of the Army&#8217;s CIRCM award came in under the radar, eclipsed by the JLTV protest.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">BAE said in a statement it decided to protest the award after reviewing the Army&#8217;s debrief because it had &#8220;identified some inconsistencies.&#8221;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">After a yearslong competition, Northrop Grumman was awarded a $35 million engineering and manufacturing development contract at the end of August to build 21 sets of the system to replace BAE&#8217;s legacy Advanced Threat Infrared Countermeasure system.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">While the initial order is small, the entire program with the Army could be worth more than $3 billion.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">A Northrop Grumman spokesman confirmed an order to stop work during the protest period had been issued, but said, &#8220;We are confident the Army conducted a rigorous and fair evaluation and look forward to moving as rapidly as possible to get this critical mission capability integrated on Army Aviation platforms.&#8221;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The Government Accountability Office will have 100 days to review the programs and issue a decision on the protests. Any work that would be performed under the contracts must stop during the review period.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Email:\u00a0<a href=\"mailto:jjudson@defensenews.com\">jjudson@defensenews.com<\/a><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Twitter: <a href=\"https:\/\/twitter.com\/jenjudson\">@jenjudson<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Lockheed Martin and BAE Systems filed protests of US Army contract awards with the GAO on the same 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