The Hatch Report (Issue #19)
Today's issue include a summary of SASC's recent hearing on defense innovation reform, thoughts on the Army's ERCA requirement, 12 DoD opportunities, and 12 industry activity updates.
SASC Hearing on Defense Acquisition and Innovation Reform
Witnesses
Honorable James F. Geurts
Former Assistant Secretary of the Navy
Research, Development and AcquisitionMr. Shyam Sankar
Chief Technology Officer and Executive Vice President
Palantir TechnologiesMr. Nathan P. Diller
Chief Executive Officer
Divergent Industries Inc.
Key Takeaways
Several themes continue to gain traction with committee members:
Empowering CCMDs with their own funding and buying power
Implementing human capital reforms to incentivize program managers and contracting officers to take calculated risks and select more new defense entrants
Senator Warren's questioning on certified cost data transparency was one of the more contentious moments in the hearing. She emphasized several concerns:
OTA agreements requiring fewer cost-data disclosures than FAR-based contracts
A potential "loophole" where contractors can avoid sharing certain cost data by getting their products designated as commercial items
A recent case where Honeywell allegedly lobbied Congress to designate its CH-47 helicopter engines as commercial items, followed by a price doubling
Questions about Palantir and Anduril's recent consortium efforts to bid on OTAs, seeking assurances about cost data transparency
Support for implementing a DoD Inspector General recommendation requiring contractors to notify the DoD of price increases exceeding 25% for products and services
Additional highlights:
Senator Ernst announced ongoing work on a new round of SBIR reform legislation to address SBIR mills
Mr. Diller introduced the concept of "factories as a service," noting the potential optimization of excess depot capacity across the country to scale manufacturing. Big supporter of this idea!
Lastly, the witnesses praised Sen. Wicker’s recently introduced “Fostering Reform and Government Efficiency in Defense (FoRGED) Act.” This is a highly comprehensive piece of defense reform legislation. As the SASC Chair, we should expect many of its provisions to be incorporated into the FY26 NDAA.
Thoughts
While the witnesses provided very valuable testimony—particularly for those new to the defense innovation space—these annual congressional hearings on defense acquisition and innovation reform have become largely indistinguishable from year to year.
A fundamental challenge is the lack of consensus around specific, measurable outcomes that can be benchmarked against current baselines. Calls to “move faster” and “innovate more” remain hollow without quantifiable metrics to assess progress.
Humble Recommendation: Develop a Defense Innovation Dashboard to:
Track the five most important outcomes / “metrics of success,” such as:
% of DoD topline allocated to new defense entrants
Average duration of capability gaps
Average APALT across various capability categories
$ IRAD investment in DoD-relevant needs
Establish clear baselines and trendlines for each metric
Monitor the progress of initiatives designed to improve these outcomes
Such a dashboard would enable Committee members to ask more targeted questions during modernization and posture hearings while informing future defense legislation. Additionally, NDAA provisions related to defense reform could be strengthened by incorporating specific outcomes in the Bill/Report language, helping to assess whether these reforms are achieving their intended effects.
Government Opportunities
1. JPEO A&A RFI: Manufacture of the M776 155mm Cannon Tubes
Seeking potential sources capable of manufacturing ten cannon tubes domestically per month NLT 36 months from the date of this sources sought.
Why 36 months?
This RFI addresses the Army’s recent reprogramming request to replenish Ukrainian M777 artillery barrels that are wearing out at an unsustainable rate. Watervliet Arsenal (the only U.S. factory currently producing large caliber gun barrels) is at capacity.
For a deeper dive, check out the excellent analysis from the Warzone.
THR’s Take (The Army’s ERCA Requirement)
I’d expect the Army to divest its towed howitzers as it ramps up efforts to field self-propelled howitzer systems (SPHS) and fulfill the ERCA requirement. Breaking Defense has a good update on these efforts.
The Army confirmed it will pursue an existing mature design and forgo a new developmental effort.
Timeline:
Mid-February 2025: Phase I RFP is expected to be released.
July to September 2025: Phase I contracts anticipated with competitive evaluation testing continuing through FY26.
Early FY27: Data from Phase I will be used to inform a Phase II downselect.
2030: Targeted timeline for initial fielding.
No Domestic Options
As with the XM30 program, there are no competitive domestic offerings, which explains the Army’s programmatic approach. For foreign firms, successfully integrating into an industry team requires expertise in managing intellectual property, industry offsets, navigating FOCI compliance, and structuring partnerships that align with U.S. regulatory requirements.
Although firms from Serbia, the Czech Republic, and France offer highly capable SPHS solutions, their limited experience in these areas could put them at a disadvantage if they decide to bid.
Domestic Manufacturing Implications
In my view, the biggest challenge is establishing a domestic production base. A modern factory—equipped with advanced tooling, AI-enabled automation, and a skilled workforce—is essential to controlling costs and meeting an aggressive production ramp.
This could lead to some interesting industry teaming. I’d be curious to see if the established SPHS manufacturers look outward for novel approaches to large-scale heavy manufacturing. Despite inherent differences, the automobile and shipbuilding industries, as well as companies like SpaceX and Tesla, come to mind. Anduril’s new Arsenal-1 factory in Ohio also stands out as a potential blueprint for setting up an advanced production line and trained workforce.
Given the Army’s plan to field systems in 2030, firms must begin strategizing now. Finalizing a site, satisfying environmental and regulatory requirements, constructing or refitting a facility, and training a workforce will take years. As a result, initial production will likely take place overseas, with manufacturing transitioning stateside once domestic capacity is fully operational.
Learn from the Navy’s Mistakes
The U.S. Navy’s Constellation-class frigate program serves as a cautionary tale. Initially based on a mature foreign design, the program underwent extensive modifications to meet Navy requirements, significantly increasing costs and causing major delays. As a result, only about 15% of the final ship design remains common with the original foreign vessel.
The Army should take note to avoid similar pitfalls. If strategic mobility concerns lead to the selection of a wheeled platform for its SPHS, the most substantial design changes to existing foreign platforms would likely center around the vehicle’s chassis. This is largely driven by production and Buy American considerations. In this context, the Army’s Common Tactical Truck (CTT) program is worth considering. If a wheeled SPHS solution is indeed pursued, leveraging the winning CTT chassis as its foundation could have its advantages.
This approach could yield economies of scale, streamlined supply chain logistics, and maintenance/training commonality across platforms. However, this approach comes with significant technical hurdles. The CTT was not designed to withstand the recoil forces of a howitzer and might not be big enough, meaning substantial modifications would be necessary. This presents a challenging trade-off between mitigating technical risks (i.e., avoiding the same pitfalls as the Navy’s frigate program) and leveraging potential industrial base efficiencies during a time of increasing budget pressure.
Other Consideration
How the SPHS interacts with ammunition resupply vehicles.
Software Integration
The Army and Air Force are considering the feasibility of using a 155mm SPHS in an air defense role, which could have significant implications for system design.
Barrel life—especially given the wear and tear observed in Ukraine—could be a critical factor in decision-making.
Self-protection capabilities are another key consideration. While SPHS units would ideally be co-located with air defense assets, real-world capacity limitations must be accounted for. Effective multi-spectral camouflage, the ability to generate multi-spectral obscurants, and sufficient SWaP to support CROWS systems and cUAS jammers are important considerations. Additionally, crew cab protection against mine blasts must also be prioritized.
While shoot-and-scoot time is likely the most important factor for survivability on the modern battlefield, there are scenarios where SPHS units may need to remain in the same position. In such cases, the crew's ability to operate and fire the SPHS remotely could be a lifesaving capability. If the SPHS is targeted by enemy forces, remote operation will increase crew survival.
2. AFRL RFI: Small Unmanned Aerial Systems (sUAS) for Flight Test Use
Seeks a total of four systems to enable comparative analysis and offer test site users a variety of assets. AFRL/DO plans to acquire two distinct systems from multiple vendors. The selected system must be currently used by other DAF units to facilitate common flight procedures and streamline approval.
Key Requirements:
Must be from DIU Blue UAS Cleared List vendors / have appropriate FCC licenses
VTOL quadcopter under 10 lbs with EO/IR cameras
AES-256 encrypted communications
30-min flight time per battery
5 km range, ~20 mph speed capability
User-friendly ground control station
Submission Deadline: 7 February
3. PEO Missiles & Space RFI Updates: cUAS Soldier Common Solutions
Industry Day slides and Q&A just posted. Q&A summarized below:
The exact number of systems is formation-dependent and yet to be determined. For planning purposes, responders should consider up to 500 systems.
Soldiers will need to carry or wear a Soldier Common C-sUAS capability that does not affect their ability to engage enemy comabtants, while simultaneously engaging UAS threats and unnecessarily weighing the soldier down.
An OTA will be used for procurement.
Solutions must be delivered within seven months from contract award.
Contract details on business category considerations (SDVOSB, WOSB, etc.) will be specified later.
The Army will conduct operational demonstrations in FY25 to assess C-UAS systems. The Army plans to procure Soldier Common C-UAS assets in FY25.
The Capabilities Development Document (CDD) will not be provided to industry, but a Performance Specification/Statement of Objectives will be included in the RFP.
Detection time must give the formation the fastest possible time to allow Soldiers to find cover and concealment.
4. DARPA Special Notice: Securing Artificial Intelligence for Battlefield Effective Robustness (SABER)
The military lacks real-world testing for AI vulnerabilities in the field. All current testing remains theoretical in labs, leaving battlefield AI systems open to unknown risks.
SABER will create a specialized "red team" to actively break, fool, and compromise military AI systems controlling ground vehicles and drones. The team will employ cyber attacks, physical tampering, and other methods to discover weaknesses before adversaries do.
SABER also seeks an ongoing process to test military AI systems in real-world conditions, prioritizing systems heading to the battlefield within the next few years.
Submission Deadline: 14 March
5. DEVCOM AvMC RFI: Adaptive Avionics
Two focus areas:
Reconfigurable Mission Systems (RMS):
Focuses on creating adaptable mission software that can be reconfigured in real-time (through repurposing, reordering, etc.) to maintain mission effectiveness.
Aims to dynamically integrate and reassign software capabilities, ensuring continued operations even when specific system components fail.
For example, an aircraft is conducting a digital call for fire (CFF) mission. The radio onboard the aircraft that can transmit the CFF message fails. Current implementations prevent utilizing other onboard resources to complete the mission, resulting in degraded operations and potential mission failure.
Tactical Real-Time Avionics Computing Enabler (TRACE):
Seeks to enhance processing capabilities by using AI and machine learning to predict system loads and intelligently allocate computing resources.
Designed to prevent processor overload and maintain continuous, reliable operation during intensive computing tasks.
Submission Deadline: 1 March
6. AFRL RFI: LEO Computational Imaging architecture
Intended to support future electro-optical moving target engagement capabilities. Development intended to progress from an experimental payload to partnership(s) with commercial satellite imagery provider(s) on extended capability prototypes. RFI’s two primary focus areas:
General approach to the system acquisition
Space Segment (payload & spacecraft)
Submission Deadline: 7 March
7. AFLCMC/HNAG RFI: Communications Networking Research and Analysis Initiatives for Tactical Data Links and Gateways
Vendors are invited to self-identify and verify their expertise in supporting two key initiatives:
AFAN Roadmap Analysis Initiative: Focuses on analyzing C2 communications, networking architectures, and operational impacts to inform future USAF communications capabilities through modeling, simulation, and experimentation.
CTEN Software Development Effort: Develops MOSA-aligned software for resilient network overlays, advanced routing, and seamless data sharing over existing and next-gen tactical communication links.
Submission Deadline: 20 February
8. DARPA Solicitation: Critical Orientation of Mathematics to Produce Advancements in Science and Security (COMPASS)
Seeks mathematical frameworks with the potential to revolutionize Defense applications. For example, the Wiener filter, developed in WWII for radar threat detection, was limited by its assumption of signal stationarity. In 1960, Rudolf Kalman addressed this by introducing a state-space approach, creating the Kalman filter. This filter remains essential in modern control theory for applications like autonomous navigation and sensor fusion. This illustrates how the right mathematical framework, combined with proper problem formulation, drives transformative Defense capabilities, requiring deep mathematical insight.
Submission Deadline: 12 May
Award Amount: Should range from $100k to $300k, including direct and indirect costs and graduate student tuition, if applicable.
PoP - 12 months
9. NSWC Crane RFI: Uncrewed Systems (UXS) Survey
The purpose of this survey is to collect responses from industry and government organizations about their Uncrewed Systems (UXS). Submissions will be reviewed for potential inclusion in future test events, demonstrations, and continuous monitoring of the UXS market. This survey form is meant to be a living document and allows the respondent to save and update their submission responses, but the submission must be saved by the respondent to do so.
10. AFRL/Information Directorate RFI: Automated Data Analysis
Seeking automated data triage, curation, and analysis capabilities that require minimal human interaction. Solutions should:
Develop associations and correlations across vast, heterogeneous datasets spanning multiple security levels.
Provide a machine-readable data presentation layer for advanced modeling and analytics.
Enable multi-fidelity analytics that optimize the balance between model complexity and prediction accuracy.
Submission Deadline: 27 February
11. DARPA Proposers Day: BioElectronics to Sense and Treat (BEST)
Overview: Seeks to revolutionize wound care for combat injuries by developing smart, wearable bandages. These advanced devices will not only continuously monitor wounds for early signs of infection but also deliver precise, pathogen-specific treatments, thereby improving outcomes on the battlefield and beyond.
Multidisciplinary Industry Teaming: Calls for collaboration across various fields (e.g., bioengineering, immunology, electronics, regulatory affairs) to integrate sensing, treatment delivery, and system integration, with opportunities for potential partners to present their expertise during Proposers Day sessions.
Event Date: 19 February
Presentation Submission Deadline: 17 February
Registration Deadline: 14 February
12. ARCYBER RFI: Forensics and Malware Analysis Laboratory Assessment Event (AE)
The Cyber Fusion Innovation Center (CFIC), in collaboration with U.S. Army Cyber Command (ARCYBER) and Army Cyber Technology and Innovation Center (ArCTIC), invites qualified industry partners to submit proposals for the design, implementation, and maintenance of an integrated Forensics and Malware Analysis Laboratory. CFIC seeks to enhance ARCYBER's forensics capabilities, enabling comprehensive malware analysis, incident response, and support to cyber defense operations of Army networks and critical infrastructure.
Submission Deadline: 17 February
Industry Activity
13. Nukkleus Sees Accelerating Opportunities in Air Defense Thanks to Trump Executive Order to Develop U.S. 'Iron Dome'
Nukkleus Inc. partners with Translink Corporate Finance to target air defense acquisitions.
Nukkleus also plans to acquire a 51% stake in Star 26 Capital Inc., the majority owner of RIMON, a key supplier for Iron Dome components.
The company aims to capitalize on surging global defense spending and demand for advanced missile defense systems.
THR’s Take
At what point do directed energy (DE) systems achieve the necessary SWaP and operational durability to take on a larger share of the missile defense mission? One way to explore this is by creating a matrix or framework that:
Categorizes DE systems by power output levels
For instance, low-, medium-, and high-power brackets.
Maps each power level to the types of threats it can neutralize
From drones and small projectiles to advanced missiles.
Projects when these DE systems will be mature enough for full-scale combat use
A timeline illustrating key technological milestones and readiness levels.
By visualizing this progression, we can better understand how and when DE technologies will begin to compete with—or potentially supplant—traditional missile-based defense systems. The core question such a framework seeks to answer is: Over time, at which milestones do DE systems start to erode the market share of existing missile defense solutions?
14. Cummings Aerospace’s 350+ mph Hellhound: A Turbojet-Powered, 3D-Printed Kamikaze Drone
Designed to meet the Army's Loitering Munition program requirements, equipping IBCTs with a high-speed, precision-strike capability.
Recent demonstrations validated its 20+ km range, ISR capabilities, and inert payload functionality under extreme weather conditions, achieving all primary objectives and confirming TRL-7 readiness.
15. Leidos and Nauticus Robotics Forge Subsea Strategic Alliance
Nauticus will apply its expertise in commercial subsea vehicle development, including its flagship Aquanaut system, along with its proprietary unmanned vehicle software platform, ToolKITT, to enhance the capabilities of future unmanned underwater vehicles.
16. Concordia Technologies Wins $9.4M MDA CPFF Contract for Hypersonic Threat Analysis
Scope of Work: Development and enhancement of hypersonic threat design and engagement scenarios, leveraging high-performance computing to improve traditionally static approaches.
PoP: January 2025 – July 2026.
Funding & Procurement: Competitively awarded under MDA’s IS&T BAA HQ0860-21-S-0001, funded by FY 2024 RDT&E funds.
17. Macrovey LLC awarded AFWERX SBIR Phase I Focused on Autonomous Warehousing Solutions
This includes implementing Macrovey's configurable autonomous warehousing systems to improve material handling, reduce costs, and enhance mission-critical operations. Using AI, the technology will integrate scalable, mobile, and autonomous robotic systems, with real-time material tracking and a proprietary warehouse management system to address the most pressing challenges in the Department of the Air Force (DAF).
18. Imagine One Technology & Management, LTD/Navy Maritime Maintenance Enterprise Solution Program Support Contract
The government intends to award a CPFF Level-of-Effort (LOE) contract to provide uninterrupted support for the Navy Maritime Maintenance Enterprise Solution (NMMES) program.
The contractor will provide engineering support across IT life cycle planning, operations, sustainment, documentation, program management, technical refresh, testing, training, and deployment.
This includes support for 79 IT systems managed by NAVSEA’s Digital Industrial Operations (DIO) SEA 03D3.
Future contract efforts will involve migrating NMMES systems to a GovCloud environment.
Period of Performance
Base period: April 1 – August 25, 2025
Option period: August 26 – December 22, 2025
19. Shiny Box’s AR Tele-Mentoring Platform Selected for Upcoming Arctic Training Events
SOCNORTH has issued a sole-source J&A for the procurement of four Vuzix M4000 AR glasses, along with all necessary equipment and software to support augmented reality training scenarios. Shiny Box requires that its equipment be used with its software, noting that the data collection, transmission, and analytics components are developed in-house and remain exclusively owned and managed by Shiny Box.
20. Penn State ARL Awarded Contract for Advanced Innovation in Modeling and Simulation
$25.6M CPFF DARPA contract to accelerate technology innovations for secure, classified hybrid cloud accredited Modeling and Simulation Integration Environments. Work will be executed 20% in State College, Pennsylvania, and 80% in Reston, Virginia, with completion expected by February 2027. This sole-source acquisition obligates $5M in FY25 RDT&E funding.
21. HRL Laboratories Wins $8.9M DARPA Contract for SURGE: Advancing Data-Driven Life Prediction in Additive Manufacturing
The project will develop advanced methods to predict the useful life of parts manufactured via additive processes. It integrates real-time in-situ sensing, process modeling, and microstructure-based fatigue analysis—validated through extensive experimentation—to establish a new standard for efficient part qualification and drive transformative advances in distributed additive manufacturing.
22. Linquest Corp Awarded SBIR Phase III Contract for Advanced Collaborative Engineering and Digital Development
This contract provides for the operationalization of the digital engineering and decision support techniques required to collect, analyze, and visualize data. $970M ceiling with completion expected by January 2035. This sole source acquisition obligates $4,972 in FY25 RDT&E funds. The contract is managed by the Space Systems Command.
23. Array Labs, Umbra Space, and RTX announce a three-way teaming agreement to accelerate development of 3D Earth observation capabilities
Site3D, the flagship product of this collaboration, combines state-of-the-art synthetic aperture radar (SAR) technology with advanced mapping algorithms to create three-dimensional models of the Earth's surface. These SAR point clouds can also be used to generate digital surface models (DSMs) and facilitate automated volumetric estimation and change detection.
The Site3D product is designed for high-value landscapes and facilities, offering customizable tasking with support for regular revisits, monitoring use cases, and change detection capabilities.
Slated for commercial release in the coming months, Site3D represents a novel approach to market entry, bridging the gap between concept and full-scale deployment in the new space industry.
24. JPO to Sole Source MATEC for F-35 Consulting Services
PoP is a one-year base period. The anticipated award date is in Q1 of Calendar Year 2025.
MATEC will support the Propulsion Production team by assisting with proposal evaluations and negotiation support for the production purchases of the F135 and supporting the greater Propulsion office. MATEC is the only source with the requisite knowledge, experience, and expertise of the JPO necessary to support the finalization of the Propulsion lots 18-19 contract.
Thoughts
How much has the DoD spent—and how much does it plan to spend—on consulting services related to the F-35? More importantly, are these costs factored into the program’s TLCC estimates? Given that these services are likely funded through O&M accounts rather than procurement or RDT&E, tracking these expenditures could prove difficult.
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