DoD Buzz

Lockheed: MEADS on Track, Don't Cut

Lockheed officials today gave a last minute pitch to keep the Medium Extended Air Defense System (MEADS) program alive on the eve of Defense Secretary Robert Gates' expected announcement of  roughly $80 billion in cuts to DoD programs.

"We're finishing up integration of our key parts," such as control stations, radars and launchers, said Mike Trotsky, Lockheed's vice president of Air and Missile Defense Systems during a Jan. 5 phone call with reporters. "Of course the missile, which is usually the highest risk item in an air-defense development has already intercepted a target and doesn't need further integration," said Trotsky. "We're confident that we have  alot behind us that we didn't have  a year ago and we can do what we need to do to get within cost and schedule" limits.

This comes after Congress, citing cost growth and schedule delays, voted to freeze funding for the program until Gates decides whether to keep it alive, a choice that will likely be revealed tomorrow.

If Gates decides to move ahead with MEADS, Congress will allow the Pentagon to award $350.2 million of a requested $467 million contract to Lockheed for continued work on the missile system. The Senate, in its version of the FY-11 defense authorization bill said will cost $1 billion more than planned and be more than a year behind schedule.

"Assuming he makes a decision to continue on with MEADS, what we expect the people at OSD to do is to answer the Congress with documentation that confirms the need for MEADS and their commitment to go ahead with it," said the executive. If this happens, "we don't see an interruption in funding" on the horizon, he added.

He went on to say that the program has received updated data since Congress moved to freeze funds for the program in the FY-11 authorization bill, which passed last month.

"The Senate, at least, got their information before we had submitted a life-cycle cost estimate, a proposal to continue the rest of the program within budget and that we had passed our critical design review," said Trotsky. "When you look at" all those factors, "I'm more optimistic now than I was a year ago about finishing the program within those requirements."

He went on to say that Lockheed has moved to make the system more efficient and resolved a number of "technical discovery" issues that surface during the development phase of a weapon system.

Trotsky also pointed out that MEADS users Germany and Italy have lobbied Gates to keep MEADS alive, adding that Lockheed is "assuming he'll make a decision to continue."

Still, only the DoD can answer the question of whether $1 billion in cost growth is acceptable, added Trotsky.

Meanwhile, the Pentagon and Lockheed are working to hammer out the details of the fixed price contract award for the latest batch of Terminal High Altitude Area Defense (THAAD) missile systems, according to Trotsky.

"As THAAD moves from development to production, there's discussions to moving toward more fixed-price contracting, those are the discussions we're having now," said Trotsky. "At this stage we're talking about mostly fixed-price incentive contracts and the details of the discussion are about the terms of the discussions."

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