šŸ”· Industrial Decay

If youā€™re new around here, welcome to the club! Weā€™ve got a ton of admin to cover, so letā€™s get to it.

šŸ‘Ž BAD NEWS: Shift.org is shutting down. The company focused on strengthening the US defense-industrial partnership via the peopleā€”one of the only efforts that existed with laser-focus on this. Over the years, theyā€™ve placed hundreds of veterans into US tech companies (defense and non-defense), but they are also well-known for their other effort: the Defense Ventures Program. This pioneering effort impacted 450+ active duty, reserve, and civil service professionalsā€”and the 100+ tech companies they were embedded in over the past 4 years. Iā€™m proud to have been one of the lucky few; the Merge would not exist if it werenā€™t for Shift and its ground-breaking DVP. I have a feeling this is the end of a chapter though; not the story. ā€“ Mike B

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Credit: AI

Fixing the Defense Industry

The Pentagon recently released the much-anticipated 2023 National Defense Industrial Strategy (NDIS). Ok, so only geeks like us were waiting with anticipation. Note to Pentagon: WTH did you throw the ā€˜2023ā€™ label on it and release it in 2024?

Anyway, we dug through the 60-page document so you donā€™t have to. The plan has 4 strategic priorities

  • Resilient supply chains that can securely produce the products, services, and technologies needed now and in the future at speed, scale, and cost.

  • Workforce readiness to provide for a sufficiently skilled, and staffed workforce that is diverse and representative of America.

  • Flexible acquisition that result in reduced development times, reduced costs, and increased scalability.

  • Economic deterrence to deterā€¦using economics?

We admit, the last one is a bit wonky. We also admit weā€™re no experts in this realm. Soā€¦we found someone who is.

Dr. Chris Michienzi was the CTO in the Pentagonā€™s Industrial Base Policy office and has first-hand experience (and scar tissue) about the withered US defense industry and efforts (past, present, and future) to restore it to what America needs. OBTW, she also led the effort to surge US munitions production for Ukraine after Russiaā€™s 2022 invasion.

You can read her recent op-ed here, but ultimately everything youā€™re reading here is a long windup for a soft pitch: listen to our latest podcast where we chat with Chris to break down this new strategy and discuss some of the monumental hurdles that need to be overcome to make this a reality.

As hard as you might think restoring the defense industrial base isā€”listen to the interview, and youā€™ll realize itā€™s 100X more difficult than you thought.

Grab it the show on SpotifyApple, YouTube or wherever you consume content.

In That Number

3000

Collins Elbit Vision Systems (CEVS) has delivered its 3,000th F-35 Gen III Helmet Mounted Display System (HMDS) for the Joint Strike Fighter program. (click for pic!)

TRIVIA

On this day in 1931, a law was passed making ā€œThe Star-Spangled Bannerā€ the official national anthem of the United States. The song was written while watching a large flag above a fort under siege survive an attack, which is obvious when you hear the words. Butā€¦which war was it?

A) Revolutionary War (1775-1783)
B) War of 1812 (1812-1815)
C) Mexican-American War (1846-1848)
D) Civil War (1861-1865)

On the Radar

KAI outlined its roadmap to bring manned-unmanned teaming (MUM-T) to South Koreaā€™s air force.

  • The Mergeā€™s Take: KAI is one of the companies leading the national effort, so what they say should carry a ton of weight. In the near term, keep an eye on phase 2 of the plan, which runs from 2025 to 2028. They plan on using an FA-50 light combat fighter as a testbed to control up to 4 in-development AI drones called KUS-LW (i.e., the US calls them CCA, Combat Collaborative Aircraft). From there, they plan on extending that to twin-seat KF-21 fighters in 2029+.

 

The Army continues to make force structure changes. The latest announcement calls for reducing 32,000 jobs, including 3,000 special operations forces, and adding 7,000+ jobs into priority units suited for contested operations.

 

Anduril is teaming up with South Koreaā€™s Hanwha for the US Armyā€™s S-MET robot transport competition. Expect this to happen fastā€”the Army wants 600+ of these robots ASAP once the winner is decided.

  • The Mergeā€™s Take: The tech is cool, but this is less about innovation and more about business strategy. Anduril is ā€œprimingā€ it for the US competition (a key part of their narrative), but subcontracting defense giant Hanwha to help bring their mature robotic vehicle into the US defense market. Side note: Anduril isnā€™t doing the autonomy eitherā€”they are subcontracting that to Forterra, a US self-driving company youā€™ve probably never heard ofā€”but has robust autonomous transport experience with various terrains (and deployed in combat zones).

 

A joint effort between the Space Force and National Reconnaissance Office to develop space-based GMTI (Ground Moving Target Indication) is approaching Milestone B in the programā€™s development stage.

  • The Mergeā€™s Take: Milestone B is the step that approves a design to enter the Engineering and Manufacturing Development (EMD) phase. Itā€™s one of hundreds of defense tech programs that are waiting on Congress to pass a budget for FY24ā€”a fiscal year that is now almost half over.

  • The Mergeā€™s Spicy Take: Donā€™t be too sympathetic. Recall that in 2018, the Air Force pushed to retire the E-8C JSTARS and replace it with space-based GMTI. Those planes were retired in 2023, but this programā€”which only started in 2024ā€”hasnā€™t even started building the replacement capability. By the time this gets in orbit and operational, thereā€™s likely to be a 7+ year capability gap.

 

Replicator is still in limbo. The Pentagon submitted a budget reprogramming request to Congress on January 31st, but still no word. Recall that the first tranche of Replicator is the plan to rapidly field thousands of drones in the Pacific by August 2025, and would do so without needing additional money from Congressā€”but it does need approval from Congress to rearrange funds that have already been appropriated.  

  • The Mergeā€™s Spicy Take: Another month to build has been lost to bureaucracy. This has never been a technology problem, as we illustrated here.

They Said It
ā€œWe believe that the reintegration of Boeing and Spirit AeroSystemsā€™ manufacturing operations would further strengthen aviation safety, improve quality and serve the interests of our customers, employees, and shareholdersā€

ā€” Boeing statement on its plan to buy back the airframe manufacturing operations it sold off in 2005. This is being driven by a string of quality control issues surrounding Boeingā€™s 737 commercial segment

Why youā€™re reading about it here: Spirit AeroSystems does defense airframe manufacturing tooā€”which includes the new B-21 stealth bomber.  

Knowledge Bombs

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ANSWER
B, the War of 1812. OBTW, the original flag still exists and you can see it on the top floor at the National Museum of American History in Washington D.C. And yes, itā€™s amazing to see in person.