U.S. Army eyes cuts to ground vehicles to fund FCS

By Andrea Shalal-Esa

WASHINGTON (Reuters) - The U.S. Army plans to cut billions of dollars from the Abrams tank built by General Dynamics Corp and other heavier vehicle programs to fund its Future Combat Systems (FCS) modernization effort and other technologies, sources familiar with Army plans said.

The funding shifts, part of the Army's six-year budget plan for 2010 through 2015, must still be approved by top Pentagon leaders before being incorporated into the 2010 defense budget proposal.

The plan would cut funding for the Abrams tank, Stryker wheeled vehicles, also built by General Dynamics, and the M-2 Bradley infantry fighting vehicle, built by Britain's BAE Systems, said the sources, who asked not to be named.

The money would be used to help pay for the $160 billion FCS modernization effort, led by Boeing Co and Science Applications International Corp, and other technologies aimed at moving toward a lighter future force.

Army spokesman Lt. Col. Martin Downie said he could not release any information since the Army was still "reviewing and adjusting" its budget plans with top Pentagon leaders.

All information on programs and budgets was "pre-decisional" at this point, he said.

FCS, the centerpiece of Army modernization, is a family of 14 manned and unmanned aerial and ground systems tied together by communications and information links.

The Army in June said it was speeding up delivery of portions of the FCS weapons program to get equipment to soldiers in Iraq and Afghanistan sooner.

The Army's plan, first reported by Inside the Army, is raising some concern among Pentagon officials and lawmakers given that some key FCS technologies are still being developed and will not be ready for combat until several years from now.

The Army may be hoping that Congress will fund the heavier ground vehicles in supplemental war spending budgets, but that could be a risky strategy since some lawmakers are already calling for an end to those supplemental budget requests and want the Pentagon to submit a more unified budget plan.

Stryker vehicles were intended as an interim solution until the FCS vehicles were available, but they have been very popular with soldiers, impressed by its mobility and ability to withstand attacks.

The Army's plan may also raise eyebrows among lawmakers, who strongly support continued production of existing ground vehicles, and have repeatedly trimmed funding for FCS in recent years until its technologies are better tested.

In March, the nonpartisan Government Accountability Office raised concerns about the Army's plan for the FCS program, noting that production money for the core FCS systems would be requested before a critical design review of the program.

Independent costs estimates also put the program's cost well above the Army's $160 billion estimate, the GAO said.

If the budget plan is approved, the Army could also face over $100 million in termination fees since the Abrams tank is part of a multiyear deal that runs through fiscal year 2012, according to one source familiar with the Army's plan.