Army Switches From Vehicle Procurement to Sustainment Mode

For 13 years, the Army has binged on billion-dollar procurement budgets and assembled the largest and newest wheeled vehicle fleet in its history.

Now military commanders and the companies that built thousands of vehicles in support of two wars are preparing for the inevitable withdrawal symptoms resulting from reduced budgets and requirements after more than a decade of combat.

The Army and industry must find a path of transition from a wartime footing where funding for vehicles was almost unlimited, to one based on sustaining those vehicles over the remainder of their service lives, said Gen. Dennis Via, chief of Army Materiel Command.

“It goes without saying that we have a challenging fiscal environment going forward,” Via said. “I think why it is so challenging for us this time is because we’ve been at war for so long. We’ve become accustomed to multi-billion dollar budgets and acquisitions. We’re drawing down on that.”

Somewhere between 60 and 90 percent of a platform’s lifecycle cost is in sustainment, he said. With nearly 300,000 tactical wheeled vehicles — some of which are still being reset from the now-ended Iraq War — the task of bringing those trucks home and fixing them up is no small task, he said.

“It’s going to become complex, because … as I talk to lieutenant colonels, they don’t remember the Army that I came into. They only know this Army where we’ve been primarily at war and have been resourced adequately to support our missions and rightfully so. But now we have this transition to sustain our equipment for the out years,” he said at the National Defense Industrial Association Tactical Wheeled Vehicle conference.

The Army has more than the 240,000 vehicles its published requirements prescribe for fiscal year 2014, said Don Tison, assistant deputy chief of staff for Army G-8. The service’s truck fleet is both large enough and new enough to sustain the Army for the foreseeable future, especially with the joint light tactical vehicle, which will replace the Humvee after 2015, funded and on schedule, he said. 

JLTV will begin low-rate initial production in 2015. Still, Humvees will be a part of the Army inventory for several years, Tison said. A sustainment plan should be in place by 2018 that includes integrating up-to-date communications equipment and modular armor packages.

The Army’s truck fleets number about 278,000 total vehicles, and now average just two to three years old — the youngest fleet in modern Army history.

“From a numbers standpoint, we’re fine,” he said. “These years of large procurement accounts have helped us fill out the fleet. Modernization and obsolescence are another matter.”

Now the fleets need to be progressively updated, Tison said.

When the Army went to war in 2001, 85 percent of its vehicles needed depot maintenance, said Lt. Gen. Raymond Mason, deputy chief of staff, Army G-4. After 13 years of war, the equation is reversed and only 15 percent of the fleet requires maintenance thanks to billions of dollars invested in reset and recapitalization, Mason said.

The main challenge is bringing existing vehicles up to the technological standards that troops became accustomed to during recent operations. Many front-line trucks like Humvees and MRAPs were retrofitted with state-of-the-art communications and command-and-control systems and are heavily armored.

“In 1999, a company commander might have a radio in his Humvee,” but “that’s the vehicle we’ve been fighting in for the last decade, with all that stuff in it,” Mason said, pointing to a picture of a Humvee cabin populated with all manner of electronic communications gear.

“Can we afford for every vehicle in the Army to look like that? The answer is obviously right in front of us: ‘No.’ So … which ones should have this and which ones shouldn’t? There’s a leadership challenge because once these soldiers have seen the lights of Paris, how do you get them back on the farm?”

The Army plans to keep around 11,100 MAXX-Pro, M-ATV and route-clearance vehicles of the 16,000 total it has now, Tison said.

“They are all relatively new. They’re not in bad shape,” Tison said. “The trick will be … to get them out of theater, do whatever upgrades we need to them and then have a sustainment conversation.”

The Army’s fleets of medium and heavy tactical vehicles also are in good shape, Tison said.

“We need to be able to recapitalize,” Tison said. “We need to look at service-life extension wherever possible. … From an equipping standpoint, I would argue we’re not in too bad of shape. From a modernization standpoint, it’s going to get each year more and more challenging.”

“Over the last 10 years, we were helped a lot with procurement,” he added. “A lot of the conversation we’re going to have to do is for sustainment, some recap[italization] with the depots and industry.”

Much of the needed recapitalization will take place in the Army’s depots and other maintenance facilities, Via said. 

As the Army transitions from a procurement footing to a sustainment footing, it will increasingly rely on its “organic industrial base” for maintenance and sustainment, Via said. The effort to preserve that subset of the commercial tactical wheeled vehicle-manufacturing sector is guided by the Army’s organic industrial base strategic plan, which promotes partnerships between the government and industry.

While commercial industry is a larger component of the overall defense industrial base, the Army is most concerned with preserving the production capacity and skills of the companies that perform work at its maintenance depots, manufacturing arsenals and ammunition plants, the plan states. 

The Army’s six depots and three arsenals dramatically ramped up production of vehicles and munitions during the wars in Iraq and Afghanistan. Manufacturers doubled and, in some cases, tripled production and labor hours at those facilities since 2003, the document says.

The strategic framework ensures that “capacity and workforces are sized to meet core capability requirements plus preserve the ability to meet future surge requirements,” and that “capital investment requirements to preserve needed capability are identified and prioritized appropriately.”

The plan also prioritizes maintaining a basic readiness within the organic industrial base so that both workforce and capacity can be ramped up in response to future threats and contingencies.

Public-private partnerships will be a “tremendous opportunity for industry,” Via said. AMC has invested billions in the infrastructure and equipment at its various facilities nationwide.

“Our task now at hand is post-combat,” Via said. “There will still be opportunities” for industry even though the flow of vehicle procurement funding likely will dramatically weaken, he added.

Col. Doyle Lassitter, commander of Red River Army Depot, said the depots were actively seeking business opportunities with industry to ensure that both Army maintainers and the tactical truck industrial base are supported through the impending peacetime lull in vehicle procurement.

“The purpose of the depots is to ensure that the war fighter has the capability to go to war now and be supported through sustainment and maintenance,” Lassitter said. “It works hand-in-glove with the commercial industry whose job is to come alongside of us. We buy you the time so you can ramp up the industrial might of this country to support any long-duration war.”

Brian Butler, executive director of the Army Life Cycle Management Command’s integrated logistics support center, said organic manufacturers cover for the less flexible corps of uniformed maintainers and engineers stationed at the arsenals and depots.

The command surged its personnel and production capacity during the wars, peaking around 2008 to 2009, Butler said. Since then, the operational requirements of the Army have declined and TACOM has had to shed excess personnel and capacity.

“We don’t have the ability — like industry does — to rapidly contract based on market conditions,” Butler said. “The trick is to make sure you are not giving up a critical skill set. … We’re trying to make sure we’re at least postured, so we don’t do something that we can’t reverse if we need to.”

During the wars of the past decade, industry housed at Army facilities was able to surge production to sustain military equipment deployed overseas, a critical capability that resulted in high vehicle operational rates, the plan states.

The Army’s strategic plan aims to find a balance between dialing down production capacity and preserving critical manufacturing skills within that organic industrial workforce.

“It is critical that the Army organic industrial base manage the transition from wartime production levels to peacetime requirements in such a manner that [it] remains effective, efficient and capable of meeting future Army contingency requirements,” the plan states. “This entails the retention of the critical maintenance and manufacturing skills, and capabilities necessary to meet Army unique needs relating to enduring and future requirements.”

Industry officials were open to the prospect of partnering with the Army to sustain its fleet, recognizing that other than the JLTV, the Defense Department will have little funding to buy new vehicles in the near term.

“We have to be really realistic on what is possible now so that we can be successful in the future,” said Clint Herrick, director of global integrated product support for Oshkosh Defense. “With our common interest in preserving the tactical wheeled vehicle industry base … we need to keep our smart people engaged and working.”

Butler said both government and industry must communicate better for such partnerships to work.

“We’ve got to open ourselves up a little bit more, both on the government side and on the industry side in order to form a more collaborative-type relationship,” Butler said. “If we can’t accurately communicate our requirements to industry and you can’t communicate back to us where the shortfalls are, then we’re just never going to get there.”

Scott Greene, vice president of ground vehicles for Lockheed Martin Missiles and Fire Control, agreed, saying a lack of transparency was one of the tallest hurdles that must be cleared before partnering with government depots makes sound business sense.

James Grooms, vice president of logistics and sustainment for Navistar Defense, said truck manufacturers that have had to shutter production facilities because of the downturn in government orders must find business elsewhere if they are to retain their ability to ramp up production in wartime.

“When we draw down capacity, as an industry partner, there has to be something that replaces that,” Grooms said. “When we think about total performance sustainment … there obviously are things that the government is going to win on, but there have to be things that industry wins on.”

Topics: Defense Department, DOD Budget, Land Forces