MRAP-ATV Fallout Leads To Navistar Layoffs

July 13, 2009 by Matthew Potter · Comment
Filed under: Business Line, Companies, Contract Awards, Department of Defense, Events, Mississippi, Navistar, Restructuring, Services, production program 

Oshkosh won the MRAP-ATV contract for a new vehicle for use in Afghanistan. One of the losing bidders was Navistar who had sold several thousand MRAP vehicles for use in Iraq to the U.S. Department of Defense.

Now with the fact that they did not win the contract to build the new vehicles for use in Afghanistan the company has announced layoffs at their Mississippi plant. This illustrates one of the problems with defense contracting. If you don’t continue to win contracts to provide systems or services you will eventually wither. Defense acquisition is normally for a certain number of units or for a period of time that will end. Companies win or lose contracts and that leads to contractions or expansions in work forces.

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Lockheed Plans Further Job Cuts Due To VH-71 Ending

June 17, 2009 by Matthew Potter · Comment
Filed under: Business Line, Companies, Congress, Countries, Department of Defense, Events, Federal Budget Process, Finemeccanica, Italy, Lockheed Martin, Military Aviation, New York, Restructuring, Services, States, Suspensions, U.S. Marine Corps, U.S. Navy, development program, production program 

Lockheed Martin had already cut over one hundred jobs at their Upstate New York facility in Owego. This was mainly due to the decision by Obama and Secretary of Defense Gates to end the VH-71 New Presidential Transport helicopter program. Even though the aircraft was made in Italy Lockheed did all the modifications and integration in Owego.

Despite a great deal of argument and pressure to keep the program going in some form or another the contract was recently terminated. Lockheed is now saying that another seven hundred and fifty people may lose their jobs. Right now they are looking for people to voluntarily leave or retire with a promise of severance. The plan is to begin the layoffs in July based on how many people agree to leave voluntarily.

One of the arguments against ending this and other production programs is that they will just add to the joblessness during the current recession. Of course the defense budget is not really a jobs program and that is fairly poor reasoning to continue spending billions of dollars on a system that does not meet requirements. It is still possible that Congress will pass some form of spending that will keep pieces of the program alive in the 2010 defense budget but that will not be finished until the Fall.

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