Military Taking Larger Role in Drone Sustainment (UPDATED)
Experts and industry officials forecast a growing need for sustainment services, but the budget crunch is prompting the services to look for creative ways to shoulder the logistics burden, including performing some of the work in military depots.
The wars in Afghanistan and Iraq prompted the Pentagon to rapidly field a menagerie of unmanned aerial systems in large quantities. The need to quickly put such capabilities into the hands of troops outweighed long term sustainability planning, which often occurred late in development, according to the Defense Department’s unmanned systems integrated roadmap released last December.
“Many programs have been procured as vertically integrated, vendor-proprietary solutions relying on a single prime contractor who was often held accountable to meet many criteria, including a compressed delivery schedule,” it said.
“These rapidly-fielded programs are often immature in terms of reliability and supportability and are heavily reliant on contractor logistics support.”
“As budget pressures increase, programs must develop more cost-effective sustainment solutions,” the roadmap said.
Calculating the market for UAS sustainment can be difficult because most of those dollars come from operations and maintenance funding, which isn’t always itemized, said Michael Blades, aerospace and defense senior industry analyst for Frost & Sullivan.
The U.S. military drone market — which includes procurement and research, development, testing and evaluation funding — will be increasing about 2.2 percent a year for the next five years, he said. When taking inflation into account, that’s a flat market.
If the military is not procuring as many remotely piloted aircraft, it will need to focus on supporting what it has, Blades said.
“I could probably guess that the increase in sustainment is probably 2 to 5 percent per year,” he said. “They have to increase the capabilities of these platforms without buying new platforms. They’re going to be putting different data links on, different sensors and all that, so I think that’s going to be where your growth comes in.”
The Pentagon spent $1.4 billion on UAS support in fiscal year 2012. That sum includes maintenance, repair, logistics and training costs, Blades said. He did not have data for 2013.
General Atomics in 2012 raked in $380 million for the MQ-1C Gray Eagle, and $350 million for the MQ-1 Predator and MQ-9 Reaper sustainment contracts, Blades said. AAI Corp. earned $270 million supporting the RQ-7 Shadow. The Defense Department also paid $135 million to sustain Boeing Insitu ScanEagles.
In a time of fiscal austerity, the military’s UAS sustainment needs are growing, but defense contractors may not be able to fully take advantage of it.
As the Pentagon’s roadmap points out, Title 10 of the U.S. Code dictates that the “Department of Defense maintain a core logistics capability that is government-owned and government-operated.”
The military resisted such limitations during the past decade of war, but is gradually moving its unmanned systems into compliance with the law, industry officials said.
The 2012 and 2013 National Defense Authorization Acts contained new rules that mandate sustainability planning occur earlier in UAS development. Approval for milestones A and B and low rate initial production will not be granted to new programs that have not gone through the process of estimating depot-level maintenance needs and forming detailed logistics requirements, the roadmap said.
Such planning will allow the military to reduce contractor logistics support and be able to sustain its own drone fleets at an earlier timeframe, it said. The military has four years after a weapon system’s initial operating capability to establish its own depot-level maintenance and repair capability, including the facilities, equipment, associated logistics capabilities, technical data and trained personnel.
Opportunities for companies to sustain the U.S. military’s legacy unmanned aerial vehicles may also be decreasing. Industry officials indicated that the services are taking on more maintenance and logistics work.
Unmanned systems were fielded when the military was concentrating on recruiting and training troops, said Alan Stull, vice president of unmanned system services for AAI Logistics & Technical Services. “They didn’t have those [UAV sustainment] skills available, and so they had to depend on a contractor workforce to do that work for them.”
A shift from older platforms needing more maintenance to newer technologies that are reliable and easier to repair could also decrease sustainment work for defense contractors. General Atomics, for instance, has seen a drop off in work as the Air Force moves from the MQ-1 Predator to a more widespread use of the MQ-9 Reaper, said Baron Asher, the company’s logistics manager for those systems.
“The amount of maintenance it takes to sustain the flight hours is changing for our company,” he said.
Defense companies will continue to have the leading role in maintaining the Army and Air Force fleets of Gray Eagles, Predator and Reaper drones, Asher said. “However, the government is moving more and more to organic management and organic repair posture, and we’ve been partnering with the Air Force and with the Army to help do the stand-up activities that make that possible for them.”
The Air Force Sustainment Center in November entered into a public-private partnership agreement with General Atomics that would hand over some maintenance tasks to the service. The agreement would cover about 30 repair parts used in the Air Force’s Predator and Reaper drones and the Army’s Gray Eagle, Asher said.
“We’ve created a model where … we would duplicate in the government depots the exact same repair process that we use in the company,” he said. General Atomics will train military personnel on how to maintain the systems and will later provide onsite engineers to assist with the repair process. The company is also transferring its supply chain and repair materials to the government.
The first Predator and Gray Eagle systems to be repaired at a government depot are scheduled for mid-February at Warner Robins Air Logistics Complex in Georgia, Asher said. Maintenance work completed at Ogden Air Logistics Complex and Oklahoma City Air Logistics Complex is scheduled to follow in the weeks after.
Eventually, the Air Force will be able to repair landing gear at Ogden, avionics equipment at Warner Robins and engine components at the Oklahoma City complex, he said.
By the end of fiscal year 2016, Warner Robins personnel will have clocked more than 15,000 hours of maintenance work for MQ-1, MQ-9 and MQ-1C, an Air Force news release stated.
After Air Force maintainers become proficient at repairing hardware, there may be opportunities for them to take over some software sustainment as well, Asher said.
“We are just in the study phases of that with our Air Force customer with a long-range plan to begin moving some software sustainment to the government depots as well,” he said. The service could take on software repair as early as 2016.
The Army and Marine Corps are taking a greater role in maintaining Shadow fleets, AAI officials said.
The company currently embeds field service representatives with Shadow platoons in the field to do most sustainment tasks, including intermediate- and depot-level field repairs, maintaining the technical data package and, in some cases, flying and mounting the payload on the aircraft, Stull said.
Over the next year, the company will move to a more regionally-aligned concept instead of having AAI staff present in every platoon. “That obviously reduces costs to the DoD,” he said.
As the roadmap made clear, the Pentagon is increasingly looking for ways to cut spending on logistics and maintenance. Industry officials said that their companies were driving down sustainment costs in order to keep contracted services palatable.
Northrop Grumman, for instance, is considering replacing a generator on its Global Hawks, which would cut down the required number of inspections, said Jim Zortman, the company’s vice president for global logistics and operational support. Once systems are mature, the company can use modeling and simulation to project the amount of spare parts it needs to stock for repairs.
Because AAI keeps Shadow maintenance personnel embedded with platoons around the world, the company has developed test procedures that help keep its workers equipped, Stull said.
“We can assess some of this in the field and repair as far forward as possible, so we don’t end up having to send stuff from Afghanistan all the way back to Hunt Valley, Md., to do a repair, that probably, with a couple special tools, could be done in Afghanistan and save all that time and effort,” he said.
With flattening sales to the military and increasing government-led sustainment, UAS manufacturers are eagerly anticipating a soon-to-be emerging market: domestic drone use in civil airspace.
Northrop Grumman has a strong relationship with Air Force bases in North Dakota, Zortman said. It has also fostered a relationship with the University of North Dakota and is looking for other opportunities to partner with local institutions.
“The folks in North Dakota … saw the potential in that civil market, particularly in a state like North Dakota that’s right in the middle of where that farming region is,” he said.
The domestic market for unmanned aerial vehicles, which could encompass everything from spraying pesticides on crops to delivering parcels for online retailer Amazon, will be more fragmented than the military, said John Hayward, senior vice president and general manager of AAI Logistics & Technical Services.
Some customers in homeland security or law enforcement may not have the funding to purchase complete systems and will prefer fee-for-service contracts where the company owns, operates and maintains the system, he said.
“You could come in and just provide only the images. You could have a multi-spectral camera, you could have a scanner on the system,” he said. “All they really care about is what the video feed is. They don’t want to fly it. They don’t want to maintain it.”
Foreign countries that have newly acquired unmanned systems will also need contractor-led logistics and maintenance until homegrown support can take over, Stull indicated.
“With countries that don’t have a lot of experience and background [with UAS], I think initially there will be a lot of requirements for training, logistics support and even operational support ... because it’s new to them,” he said, noting the Middle East and Africa as two growing markets.
Correction: A previous version of this article misidentified the service affiliation of the subject in the photograph.