General Dynamics Radio Backed by Pentagon Weapons Buyer

The Pentagon’s top weapons buyer has backed an Army plan to increase production of smartphone- compatible radios made by General Dynamics Corp. (GD)

The Army is authorized to buy an additional 13,077 of the Rifleman Radios and then must hold a “full and open” competition for the next phase of production, according to a memorandum signed June 11 by Frank Kendall, the undersecretary of defense for acquisition, technology and logistics.

The radios, part of a program called the Joint Tactical Radio System, can connect with smartphones and tablets to display data and information. The military plans to issue them to some troops deploying to Afghanistan in the fall.

“It’s something we’re very pleased to see,” Chris Brady, a vice president for Falls Church, Virginia-based General Dynamics, said of the production decision. “That means we have to be adding value to the soldier’s mission.”

The military already agreed to purchase 6,250 of the radios from General Dynamics. Kendall’s decision means the company will produce 19,327 of the program’s planned 193,279 -- or about 10 percent -- before the next competition begins.

A contract for the additional orders may come “in the next few weeks,” Brady said in an interview.

The previous General Dynamics contract for low-rate initial production was valued at $56.4 million. The company teamed with a unit of Neuilly-Sur-Seine, France-based Thales SA (HO) to build the Rifleman Radio and with Cedar Rapids, Iowa-based Rockwell Collins Inc. (COL) to build a separate, backpack-like radio.

Harris, Exelis

Harris Corp., (HRS) based in Melbourne, Florida, and Exelis Inc. (XLS), based in McLean, Virginia, are among companies that plan to compete for the next round of production.

Spurring competition in “this $1 billion-plus program at full-rate production will set the conditions for cost savings for the government and will encourage industry to be innovative in their solutions,” Dennis Moran, vice president for business development at Harris, said in an e-mail.

Kendall seemed to recognize “the value of commercial competition, especially in the handheld area,” Dave Prater, a vice president at Exelis, said in an interview. “We look forward to bringing products that meet the Army’s needs.”

Kendall asked the Army in his memo to respond within two weeks with a plan outlining a competition for radio orders as the program enters full production by Sept. 30, 2013. Typically, the Army would award contracts to companies with qualifying radios and the contractors would vie for annual purchases orders.

Kendall praised the radio’s performance this year during an exercise with the 75th Ranger Regiment, one of the Army’s elite special operations forces.

The Rangers demonstrated the radio “is an effective communications tool,” Kendall wrote. “This capability is highly anticipated by soldiers across the Army.”

To contact the reporters on this story: Tony Capaccio in Washington at acapaccio@bloomberg.net; Brendan McGarry in Washington at bmcgarry2@bloomberg.net

To contact the editor responsible for this story: Stephanie Stoughton at sstoughton@bloomberg.net

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