Blackwater USA, the private security and training company, has shut down a large part of its manufacturing subdivision after losing the Joint Light Tactical Vehicle program and facing dwindling demand for its "Grizzly" Mine Resistant Ambush Protected Vehicle.
Reports had previously indicated that Blackwater would lay off its JLTV workers, some of whom were lured to the Moyock, N.C.-based company from Ford and Volvo. But according to sources the company is shutting down all vehicle manufacturing.
Blackwater spokeswoman Anne Tyrrell declined to specify how many employees were laid off by the cut, but sources close to the company say about 50 workers will lose their jobs.
"Any time a specific business venture doesn't go as planned it is disappointing," Blackwater president Gary Jackson told Defense Tech. "After a detailed review of our vehicle manufacturing operation, we made the difficult decision to discontinue this particular business line."
The cuts do not affect Blackwater's manufacturing capability for firearms range systems, Tyrrell added.
Company sources also admit that the military's shift from purchasing new MRAP II vehicles to keeping current MRAPs and outfitting them with stronger armor contributed to Blackwater's business losses since demand for the Grizzly shrank with requirements. And industry watchers say the military will likely skip over the MRAP II design entirely and take a closer look at the MRAP Light, such as Navistar's Maxpro vehicle.
The Army recently released a solicitation that called for nearly 10,000 so-called MRAP-All Terrain Vehicles to add to their fleet of 12,000 heavy MRAPs.
Tyrrell said the vast hanger spaces previously used to build Grizzly's and to design their JLTV prototype will be converted into an aviation maintenance and repair center to build on the company's already expanding contract aviation support business.
Blackwater will also soon launch a new MRAP vehicle driver's training course at their sprawling North Carolina compound, using unsold Grizzlies to prepare troops for navigating the topheavy vehicles in tortuous terrain.