Wisconsin company wins $476 million contract for new US Army vehicle
By RICK BARRETT | Milwaukee Journal Sentinel | Published: February 8, 2018
MILWAUKEE (Tribune News Service) — Oshkosh Corp. has won a $476 million contract for an upgraded military vehicle that's expected to create up to seven years of additional work at the state's largest defense contractor.
The U.S. Army contract is for the next generation of medium tactical vehicles, to be manufactured in Oshkosh, where the company already is building thousands of other military trucks.
Production for the new work is expected to begin in 2021, supporting more than 3,000 existing jobs at the company, plus jobs at 250 suppliers.
"This is a great opportunity for our supply base, which is very heavily located in Wisconsin," said Pat Williams, vice president and general manager of Army and Marine Corps Programs at Oshkosh Defense.
The Family of Medium Tactical Vehicles A2, as it's called, will comprise 16 models and trailers capable of hauling payloads up to 10 tons and performing a wide range of tasks including support of combat missions and relief efforts.
The initial estimated contract value is $476 million with no cap on the number of vehicles the Army might purchase, according to the company.
Oshkosh has been building FMTVs for about eight years, and the new variant will be manufactured on the same assembly line, according to the company.
"It extends our FMTV production for up to seven years," Williams said.
Oshkosh says the new vehicle will have more power than the current model, and that it will have safety enhancements, including better under-body protection against roadside bombs that have killed scores of troops in Iraq and Afghanistan.
The truck will have electronic stability control, like what's available on many cars, so when it starts to slide it will automatically correct itself. That's a safety feature, especially when hauling munitions.
The truck will have a plethora of new electronics and an independent suspension system to improve the ride quality and make it better suited for off-road use.
It wouldn't be difficult to transform the A2, which is packed with new technologies, into an autonomous vehicle, according to Williams.
"I would expect that, with the government's push on autonomous vehicles and modernization, they may look to do that," he said.
The contract, which Oshkosh won in competitive bidding, is for five years plus two one-year option periods. In its solicitation for bids, the government called for 2,400 vehicles, although that's not a firm figure, as there's no set limit.
"We would have to defer to the government in what they intend to buy," Williams said.
There will be extensive testing of the vehicle in the first couple of years of the contract, with production starting in about the third year.
The price per vehicle has not yet been disclosed by the Army and will vary based on the 16 different vehicle configurations over seven years.
U.S. allies likely will be interested in the new FMTV, as they use the current version of the truck, made by Oshkosh, in their armed forces.
There could be additional opportunities for suppliers, too, including small businesses.
"We could add more suppliers. Once we get into the testing and development phase, there's potential of developing new capabilities (for the truck). But even as the program stands, I could see the opportunity to add suppliers," Williams said.
Years of work have already gone into getting the A2 ready for production.
The Army's requirements for improvements from the current FMTV, known as the A1, were challenging and sometimes conflicting — such as better protection for troops while not making the vehicle so heavy that it would sink in soft soils.
"In some ways it was almost like a whack-a-mole game. ... You make one thing better, but then something else pops up," Williams said.
Still, heavy trucks are the backbone of the Army's transportation system, hauling weapons, ammunition and supplies. Some of the trucks that have been used in Iraq and Afghanistan are more than 20 years old and are due for an update.
In 2016, Oshkosh landed $677.1 million in new military business, including rebuilding hundreds of tactical trucks.
That work for the U.S. Army is taking place until about December 2024. It includes $433.3 million for refurbishing some of the biggest armored trucks used in the war in Afghanistan.
Oshkosh has manufactured more than 150,000 military vehicles, including 36,000 FMTVs and trailers, for the U.S. military and its allies.
The company is one Wisconsin's largest employers of veterans and reservists.
"Our people take this work personally. They know exactly where these trucks are going and who they're supporting," Williams said.