11-13 May 200411-13 May 2004

Program Executive Office AmmunitionProgram Executive Office Ammunition

Presented By:Mr. Matthew T. Zimmerman

Associate PEO Ammunition – Industrial Base

Presented By:Mr. Matthew T. Zimmerman

Associate PEO Ammunition – Industrial Base

Presented To:NDIA Small Arms

Symposium

Presented To:NDIA Small Arms

Symposium

3

PEO AmmoPEO AmmoPEO AmmoPEO Ammo

Develop and Procure Conventional and Leap-Ahead

Munitions Combat Power to Warfighters

MISSION

Field Precision Munitions & Smart Weapons

Improve and Sustain the Conventional Stockpile

Satisfy the Customer, Achieve Excellence

Grow World-Class People and Teams

GOALS

4

PEO Ammo OrganizationPEO Ammo Organization

Maneuver Ammo System - Direct Fire

Mr. Bill Sanville PM

PEO Ammunition

BG Paul Izzo PEOMr. Kevin Fahey DPEO

Close Combat Systems

Mr. Jim Sutton PM

Combat Ammo Systems - Indirect Fire

COL Nate Sledge PM

Medium & Small CaliberLarge CaliberExcaliburMortars

Demolitions / Non-Lethal

Networked Munitions/ Munitions /

CountermineDEMIL

Joint Services

COL Jeff Gwilliam PM

Industrial BaseMr. Matt ZimmermanAPEO Industrial Base

Washington, D.C.Liaison Team

5

PEO Ammo Main ObjectivesPEO Ammo Main ObjectivesPEO Ammo Main ObjectivesPEO Ammo Main Objectives

Unify & Integrate Ammunition Management Under One Single Chain of Command…by Consolidating Responsibility and Resource Management in the PEO

Develop a Unified Munitions Acquisition Strategy Integrate Requirements…Training, War Reserve, & Modernization Include SMCA Mission By Munition Family

Identify and Optimize Key Business Processes Develop and Implement an Industrial Base

Strategy (Organic and

Commercial)

Authority and Accountability… For Meeting Full Military Requirement For all Ammo Families

Common Themes From PNNL Study, GAO Study,

and Rand Study

Common Themes From PNNL Study, GAO Study,

and Rand Study

6

Where We Are TodayWhere We Are Today Single Manager for Conventional Ammunition

(SMCA) ASA(ALT) Named SMCA – 8 Jan 2003 PEO Ammunition Named SMCA Executor – 16 Apr

2003 Section 806 Authority Assigned 16 April 2003 SMCA Charter in Service Review All FY04 Service Funding Goes thru PEO

Ammunition PM’s are Engaging Other Services Formed SMCA Acquisition Council Completed Executive 6 Sigma Black Belt Program Implementing Ammo Enterprise

Metrics – Covering All SMCA Functional Areas

• All Major Issues Resolved• Moving Forward With Execution• Measuring Improvements

7

Single Manager for Conventional Single Manager for Conventional Ammunition (SMCA)Ammunition (SMCA)

SMCA Key Objective: Achieve the Highest Possible Degree of Efficiency and Effectiveness Acquiring Conventional Ammunition

SMCA Functions: RDTE Production Base Acquisition Supply & Maintenance Demilitarization

DOD D5160.65DOD I5160.68

8

Ammunition Enterprise Ammunition Enterprise DefinitionDefinition

The Ammunition Enterprise is the integration of people, infra-structure and processes required for ammunition life cycle management to support the warfighter.

JMC-PEO Ammo - ARDEC

9

PM Combat Ammunition Systems• Artillery Ammunition• Artillery Fuze• Mortar

PM Close Combat Systems• Mines, Countermines & Demolition

PM Maneuver Ammunition Systems• Large Caliber• Medium Caliber• Small Caliber

PM Joint Services• PEO Industrial Base• Demil

Source: FY05 PB

PEO Ammo

$696.7

$573.0

$212.5$57.0

$260.4

(32%)

(39%) (14%)

RDA FY 04 PEO Ammo RDA FY 04 PEO Ammo Budget TotalBudget Total

Total: $1,799.6M (3%) (12%)

RDTE $184,067WTCV $10,027OPA $39,224Ammo $339,633

RDTE $30,937Ammo $181,626 RDTE $31,595

Ammo $25,446

RDTE

$133,615OPA

$17,884Ammo

$108,881

RDTE $26,521Ammo $670,148

10

WP MOD (plus-up) $24.30

IF $32.35

IF (Plus Up)$25.31

MIF$5.8

LIF$9.7

ARMS(Plus Up) $7.00

ARMS$4.57

FY04 PEO Ammo Funding ($M)FY04 PEO Ammo Funding ($M)

IF=Industrial FacilitiesMIF= Maintenance of Industrial FacilitiesLIF= Layaway of Industrial FacilitiesARMS= Armament Retooling & Manufacturing Support (ARMS)WP MOD= White Phosphorous Modernization

Industrial BaseTotal=$131.22M

RDTE($406.7M)

Procurement1,392.9M

PEO AmmoTotal=$1,799.6M

ProductionBase SupportProgram

PAA Total= $109M

Source: FY05 PBSource: FY05 PB

RDTERDTE$22.22$22.22

Section 806 Summary

FY03 Procurements FY04 Procurements

Procurement Approach Distributions

Competition Limited to the NTIB Full and Open

Sole Source Small Business Set Aside

Army 98 $377.4M

USN 17 $24.3M

USMC 24 $19.9M

USAF 27 $1009.9M

$223.9M

$860M

$321.4M

$26.2M

Army 34 $1689.7M

USN 61 $435.1M

USMC 3 $19.4MUSAF 14 $2187.4MTOTAL 112 $4331.6M

TOTAL 166 $1431.5M

FY03 Sec 806s

FY04 Sec 806s$1274.7M

$205.2M

$421.3M

$2430.4M

Section 806:•Public Law 105-261, Procurement of Conventional Ammunition•Permits SMCA to Restrict Procurements to Sources within NTIB

•PEO Ammo Delegated Section 806 Authority Nov 02

12

Small Arms Ammo Small Arms Ammo Production HistoryProduction History

Years

1944 1950 1956 1962 1968 1974 1980 1986 1992 1998 2004 2010

0

500

1000

1500

2000

2500

KOREA1950-1953

VIETNAM1966-1975

WWII1941-1945

MultipleMFGs Remington Arms

OlinATK

12Plants

3Plants

2Plants 1

Plant

USAMil

lion

s of

Rou

nds

13

Requirement IncreasesRequirement Increases(Produced at Lake City)(Produced at Lake City)

0

200,000,000

400,000,000

600,000,000

800,000,000

1,000,000,000

1,200,000,000

1,400,000,000

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

5.56MM 7.62mm .50 Cal

Unknowns associated with live fire training

and OIF Supplemental

Increased requirements due to Chief of Staff training surge

Source: Integrated Conventional Ammunition Procurement Plan

FY04 Draft Execution Price List Quantity

14

Small Cal Ammo ScenariosSmall Cal Ammo Scenarios

0

200000

400000

600000

800000

1000000

1200000

1400000

1600000

1800000

2000000

FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11

#CT

GS

(K

)

FUNDED QTY (K) LCAAP FUNDED PRODUCTIONLCAAP PROD CAP STATED GOAL (Army Req + Other Services)POTENTIAL SURGE REQ.

0

200000

400000

600000

800000

1000000

1200000

1400000

1600000

1800000

2000000

FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11

#CT

GS

(K

)

FUNDED QTY (K) LCAAP FUNDED PRODUCTIONLCAAP PROD CAP STATED GOAL (Army Req + Other Services)POTENTIAL SURGE REQ.

POM FUNDING (ALL SERVICES)

DESIRED SURGE CAPABILITYGOAL ALL SERVICES

LCAAP CAPACITY

ALT. SOURCEUNFUNDED

REQUIREMENTS

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Small Caliber AmmunitionSmall Caliber Ammunition

.50 Cal: A large number of soldiers commented that the M2 machine gun is “…the best weapon in the Army” They successfully engaged and destroyed

targets (light armor, buildings and personnel) between 50-2000 meters without experiencing any major malfunctions or breakages on the weapon system

7.62mm: Coax machine gun and loader machine gun were most widely used weapons for tanks Ammunition and weapon systems

performed very well

5.56mm: Most soldiers considered M16 weapon series to be very accurate regardless of the version or sighting system One sniper team spotter employed his

M16A4 (equipped with a high powered scope) against targets at 600 and 800 meters with first round hits in each case

16

Industrial Base Strategic PlanIndustrial Base Strategic Plan

30 Tactical Strategies

Sample Overarching Strategies:

Outlines Goals and Tactics to Shape the Industrial Base

1. Transform to Meet Current and Future Requirements2. Modernize Utilized Manufacturing Capacity3. Balance Industrial Base & Acquisition Management Risk4. Operate Efficiently and Effectively5. Incentivize Industry to Reinvest in Capital Equipment and Processes

1. Acquisitions Will Determine and Posture the Production Base.

2. Acquisitions and Investments Will be Synchronized to Assure Required Manufacturing Capabilities Remain Available.

3. Opportunities for Greater Joint Service Activity Will be Identified and Implemented.

Strategic Goals:

7 OverarchingStrategies

Single Manager for Conventional Ammunition (SMCA)

Industrial Base Strategic Plan: 2015Volume A

3 November 2003

Program Executive Office AmmunitionSFAE-AMO

Picatinny Arsenal, NJ 07806-5000

17

GOCO Production Base OutlookGOCO Production Base Outlook

Scranton

Riverbank

Louisiana

Lake City

Lone Star

Miss.

Milan

Iowa

Holston

Radford

Kansas

Day & Zimmermann

General Dynamics

OSI

MTI

AmericanOrdnance

FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12

FY03

ATK

Chamberlain

Norris

Valentec

FY99

BRAC05

BAE Syst

Facilities-Jul 24

Facilities-Jun 23

= Contract term expires

= Decision or actionable point

1-Align Facility Use Contracts w/ BRAC05

2-Pursue Feasibility and Overall Business Case for Sell, Long Term Lease, and/or Capability Consolidation (Pending BRAC Outcome)

Principal Strategy:

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Summary – The Ammunition Summary – The Ammunition Enterprise is …Enterprise is …

Supporting Current Operations/Planning Future

Improving Ammunition

Life-Cycle Practices

Focused, Well-Trained Workforce

Leveraging World Class Capabilities & Technologies

Vital to the development of products for the Future Joint Force