Northrop Grumman Corp. has fended off a rival bid from Lockheed Martin Corp. to win a training-simulation contract potentially worth $490 million to support the U.S. Air Force's next-generation air-combat virtual-training network, industry experts said Wednesday.
Virginia-based Northrop Grumman -- one of Florida's largest defense contractors -- will perform the work at its Orlando military-training operation, according to an announcement by the Department of Defense. Terms call for the work to be completed by June 30, 2018.
Northrop will develop and manage a system dubbed the "Distributed Mission Operations Network 2.0," which connects combat-aircraft simulators of all kinds -- from fighter jets to refueling planes -- to the same interactive training exercises, the Pentagon said.
If all options are exercised, it would be the largest training-simulation contract awarded to a Florida operation so far this year. When contacted, Northrop acknowledged the award but referred all other questions to the Air Force.
Northrop's competitor for the lucrative deal was Florida's largest military contractor, Lockheed, according to Michael Blades, a senior defense analyst for the Frost & Sullivan consulting firm. Lockheed's Mission Systems & Training unit in Orlando employs more than 1,000 workers. Among other projects, it manages the F-35 pilot-training center at Eglin Air Force Base in the Florida Panhandle, which is one of the centers that would connect to the Air Force's mission-operations training network.
"This is a fairly big win for Northrop Grumman," Blades said. "Just like other areas of defense, the training-and-simulation industry has been hurt by the across-the-board sequestration budget cuts. But, eventually, simulation-training funding like this Northrop contract is expected to do better, since it offers effective training at a lower cost."
The win is also significant for Northrop's simulation division, which lost a bid earlier this year for a trio of contracts related to virtual-training systems for the Littoral Combat Ship, the Navy's new, advanced warship.
San Diego-based Cubic Corp. topped both Northrop and Lockheed to win those deals, potentially worth a combined $300 million. Cubic said in January it would create 300 jobs in its Orlando division related to that work.
It is not known whether Northrop's winning of the Air Force contract will lead to hiring in Orlando; the company would not comment. Northrop has eliminated hundreds of jobs across Central Florida in recent years -- more than 625 at its Apopka laser-systems operation alone -- as war operations ended in Iraq and have been winding down in Afghanistan.
Earlier this year, however, Northrop announced plans to add 1,000 jobs in Melbourne and build a plant there as it consolidates the company's aircraft-design operations. The company could receive close to $20 million in state and local tax breaks as a result of the expansion.