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U.S. Navy plans competition for next-generation missile

By Andrea Shalal

WASHINGTON (Reuters) - The U.S. Navy on Wednesday said it planned to launch an open competition around fiscal 2017 for a next-generation missile, seeking to reassure weapons makers they still have prospects after a separate deal with Lockheed Martin Corp for 90 air-launched missiles sparked a formal protest.

Navy acquisition chief Sean Stackley told reporters the Lockheed program was limited in scope and the future, bigger missile development program would be open to all potential bidders.

"That will be competed. That is 100 percent competition," he said after a hearing held by the House Armed Services Committee's seapower and projection forces subcommittee.

Stackley defended the Pentagon's decision to order 90 long-range anti-ship missiles from Lockheed that were developed under a contract with the Defense Advanced Research Projects Agency (DARPA). He said the move was justified given the urgent needs of military commanders and said the initial DARPA research contract with Lockheed was awarded after a formal competition.

"The way to get it out there as quickly as possible is to take this system that DARPA has developed with Lockheed and build a limited number (of air-launched missiles) to get it out into the fleet's hands by the 2018 timeframe," he said.

Stackley said the decision required a special "justification and authorization" by the Pentagon's acquisition chief since it was a sole-source deal and that move had sparked a protest by a rival company.

He declined further comment, but said he wanted to make very clear that the larger procurement would be competitively bid.

Contract award protests have grown more common in recent years given the shrinking number of new weapons programs available.

Raytheon Co has spoken publicly about its concerns about the Pentagon's backing for the Lockheed missile, arguing that its Joint Stand-off Weapons-Extended Range (JSOW-ER) weapon would offer comparable capability at a far lower cost.

Stackley said the Navy would follow up on the sole-source deal with Lockheed in coming years with a full competition for surface-launched missiles, but gave no further details.

Rear Admiral Mathias Winter, the Navy's program executive officer for unmanned aviation and strike weapons, told Reuters in a separate interview the Navy moved ahead with a sole-source deal for the air-launched missile because of the urgent need.

He declined to give any details on the capabilities of the Lockheed missile, but said the goal was to start using the missiles on Air Force B-1 bombers and Navy F/A-18 fighter jets around fiscal 2018 or 2019 under a joint Navy-led program.

Current Harpoon missiles and Standoff Land Attack Missile-Expanded Response (SLAM-ER) weapons built by Boeing Co offered a "formidable" capability for attacking moving targets today, but future threats required added capabilities, Winter said.

Winter said his office was now reviewing an analysis of alternatives completed several years ago and embarking on a thorough feasibility study to map out the requirements for "Increment 2" of a next-generation missile in the current constrained budget environment.

"It will look at what launch platform capabilities are required, and what launch platform capabilities the department can afford," Winter said.

The Navy planned to launch a full and open competition for missiles that could be launched from the air, surface ships or submarines around fiscal year 2016 or 2017, with the goal of developing new missiles for delivery around 2024, Winter said.

Stackley also defended the Navy's decision to halt production of Tomahawk cruise missiles made by Raytheon, arguing that the current inventory of some 4,000 missiles was adequate.

He said there would be a production gap from 2016 to 2019, when the current generation of missiles will need to be overhauled and recertified. But he said Raytheon would still have work to do on certain modernization projects.

Winter said foreign military sales and modifications would also help Raytheon sustain the Tomahawk industrial base until the existing missiles came in for recertification work.

(Reporting by Andrea Shalal; Editing by Matt Driskill)

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