US army pushes back decision on $8bn BAE howitzers deal

Problems in quality such as welding plus concern at BAE's failure to consistently deliver vehicles in accordance with scheduled quantities, cited as reasons

The army cited problems including sub-par construction for delay. Bloomberg

US army officials have delayed a decision on moving BAE Systems’ new self-propelled howitzer into full production, possibly as late as November, until the service sees more improvements in the $8.1 billion programme that’s one its highest priorities.

“They have made progress, but they’re still not at the point where they’ve convinced us they are prepared to go into full-rate production,” army secretary Mark Esper told Bloomberg. “There’s some thresholds they have to meet” for the service and for the Defence Contract Management Agency, which is monitoring the company’s progress in improving quality.

The new self-propelled 155mm howitzer and accompanying ammunition carrier are the centrepiece of the army’s artillery plans. It’s part of the “long-range precision strike” capability that tops the service’s list of modernisation priorities. The category is due for a major increase in the new five-year budget plan to be released next week.

The decision on a contract for full-rate production was to have have been made last July but was delayed until December over problems in quality and delivery, including past problems in welding. Then the service decided to wait again because “BAE failed to consistently deliver vehicles in accordance with scheduled quantities”, according to Army spokeswoman Ashley John.

She said the service is likely to award a smaller contract this month to acquire parts needed to prevent a halt in the production line.

Mr Esper said full-rate production will have to wait until the US unit of London-based BAE can show “both a consistent rate and a consistent level of quality”.

Ms John added that “BAE is delivering vehicles of an acceptable quality. However they have yet to demonstrate consistent delivery of vehicles at a rate that demonstrates the programme is ready” for full-rate production.

Howitzer sections are initially produced at BAE’s Pennsylvania facility with final assembly in Oklahoma. The programme has a strong advocate in senate armed services committee chairman Jim Inhofe of Oklahoma. The defence policy bill for this year authorised spending $110 million more than the $351.8m requested.

Contracts for 162 sets of howitzers and ammunition haulers have been awarded so far, and $1.46bn has been obligated to BAE across multiple contracts. If full-rate production were approved today, it could be mean as $842 million more for 120 vehicle sets.

The army eventually wants to buy 576 howitzers and ammunition carriers.

BAE spokeswoman Kelly Golden said: “We have enhanced the weld and fabrication processes across our entire manufacturing network, to include our suppliers. As part of these improvements, we implemented a 100 per cent in-station weld inspection across our facilities and are now delivering defect-free vehicles to the army at a higher rate.”

The company has invested $200m in improvements including a new robotic weld capability installed last year at the Pennsylvania facility.

Last April, The National reported that the US government announced its approval of a $1.3bn arms sale to Saudi Arabia providing a full US-made howitzer artillery system.

According to the US Defense Security Cooperation Agency, the sale was requested by Riyadh and includes: 180 units of the 155mm M109A5/A6 medium self-propelled howitzer structures for conversion; 177 155mm M109A6 Paladin medium self-propelled howitzer systems; three fire support combined arms tactical trainers static training devices; 180 M2 HB 50 cal machine guns; and eight advanced field artillery tactical data systems. It also covers support, maintenance, engineering and testing of the system.