WASHINGTON — Northrop Grumman does not plan to bid on the Air Force’s sixth-generation Next Generation Air Dominance fighter program as a prime contractor, chief executive Kathy Warden said Thursday.
But Northrop Grumman is interested in serving as a supplier to other bidders on the Air Force NGAD program as part of its mission systems portfolio, Warden told analysts in an earnings call.
The Air Force in May announced it had sent industry a classified solicitation for an engineering and manufacturing development contract for NGAD, launching the process for selecting a company to build the advanced fighter system that will replace the F-22 Raptor.
In Thursday’s call, Warden said Northrop had previously been “quiet” about its plans for NGAD, but has now told the Air Force it does not plan to respond to the request for proposals as a prime.
“We are remaining disciplined in assessing the right programs to pursue,” Warden said. “And that’s ones where we feel we’re well positioned with mature offerings, and where the business deal reflects an appropriate balance of risk and reward for both the customer and the industrial base.”
Warden said Northrop Grumman might participate in the Navy’s separate NGAD program, which the service refers to as F/A-XX.
“We have other opportunities we are pursuing,” Warden said when asked about F/A-XX. “I won’t disclose at this point exactly what those are until a little more information comes out on other programs. But you could assume that if we feel we’re well-positioned, and the government is appropriately balancing risk and reward, that would be a program we would pursue.”
Dave Keffer, Northrop Grumman’s chief financial officer, also said testers in the second quarter successfully turned on the power for the B-21 Raider’s systems, and the stealth bomber is still on track for its first flight in 2023.
Keffer said Northrop expects the Air Force to award the first low-rate initial production contract on the B-21 after that first flight.
But Warden warned inflation and other macroeconomic factors remain a risk for the B-21. She said the Pentagon notified Northrop in the most recent quarter that it has allocated another $60 million for B-21 LRIP procurement in 2023 due to inflationary effects. The Air Force has $1.4 billion budgeted in 2023 for B-21 procurement, including advance procurement funds from the previous year.
In a previous earnings call in January, Warden warned inflation, supply chain disruptions and labor issues had raised the B-21′s cost estimates. And the company said then a loss of up to $1.2 billion on one or more of the expected five LRIP lots was “reasonably possible.”
On Thursday, Warden said the company is still not expecting to generate profit from the B-21′s LRIP.
Author: Stephen Losey
Source: DefenseNews
