Sunday, September 23, 2007

MRAP Contract Countdown

We're at 8 days -- that's one week from tomorrow -- until DOD announces where the MRAP II contracts are going. There's a good chance that the demand for the vehicle will make the Pentagon more likely to distribute a portion of the pie to as many companies that are able to build a MRAP to spec, so there's a good chance that Oshkosh Truck will be getting some orders.

As the date approaches local newspapers in the areas that are likely to be affected by the potentially $11 billion in defense disbursements are starting to run stories on the potential economic windfall. For instance, in Anniston, Alabama:

General Dynamics hired 270 workers in Oxford earlier this year to build a round of MRAPs authorized last year. The company already built Stryker and Fox combat vehicles in Calhoun County in partnership with the Anniston Army Depot, a 15,000-acre base that specializes in building, repairing and testing tanks and armored cars. It goes by the slogan "Pit Crew of the American Warfighter."

And in Charlotte, Michigan:

Sztykiel said Spartan officials had no idea three or four years ago that they would be entering the military vehicle business. But a former Spartan supplier suggested to Force Protection Inc., a builder of Mine Resistant Ambush Protected armored vehicles (MRAPs) for the U.S. military, that Spartan could help boost production efficiency -- a critical need due to a surge in demand for such vehicles in Iraq.

Spartan did its first MRAP assembly in July 2005, attaching a Spartan chassis to a hull designed with extra underbody armor to protect soldiers from roadside bombs and land mines.

Specialty vehicles, mostly MRAPs, provided 31% of Spartan sales last quarter, up from 9% a year earlier. The company is looking to boost MRAP output to 20 vehicles a day next month, from eight to 10 per day now. A hundred new Spartan workers will be added by Oct. 20 to help meet demand, said Richard Schalter, president of the Spartan Chassis operating unit.

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