Wednesday, April 8, 2009

Stupid Article in Newsweek About Textron and Defense Spending

This article was published today at I don't know if it will be in their print edition as I last read a copy of this magazine sometime in the Nineties. It is about Textron and the future of the company I guess during the Obama Administration. Somehow it links the downturn in the economy to the rise of Obama on the national stage, but I haven't figured out that relationship. One of the statements in the article is especially egregious -- "Money was cheap, the defense budget was growing, and your customers didn't particularly care how much anything cost." The Pentagon and the U.S. Government care very deeply how much things cost especially for military hardware. Bell, a unit of Textron, lost the Armed Reconnaissance Helicopter (ARH) contract because cost and schedule spiraled upwards. The AH-1Z and UH-1Y programs came close to ending for the same reason. The Pentagon though is often hamstrung in these cases as they have made a commitment to a program, a needed program, and have to deal with the cost increases over time. In many cases the Services contribute to the cost increases because requirements change after the contracts are awarded. Believe me though based on experience cost is a deep concern with these kind of programs.

No comments: