UPDATE 3-US Army's FCS program ended in current form
* Army working on details for continuing modernization
* Future role of integrator still unclear
* Army, contractors to discuss termination fee (Adds Boeing reaction)
WASHINGTON, May 18 (Reuters) - Pentagon chief arms buyer Ashton Carter said on Monday that the Army's $160 billion Future Combat Systems (FCS) modernization program was ending, not just the $87 billion manned ground vehicle segment.
He said Army modernization efforts would continue as separate programs and that the future role of Boeing Co (BA.N) and Science Applications International Corp SAIC.UL, lead system integrators for FCS, was still being determined.
"FCS has been stopped. It's the entire program," Carter told reporters after addressing an event hosted by the Center for Naval Analyses, noting that the program includes many different elements. "Now we'll have to see what to do with these different pieces."
Defense Secretary Robert Gates last month said he planned to cancel the manned ground vehicle part of the huge FCS program to better integrate lessons learned from the wars in Iraq and Afghanistan, but it was not clear at the time that the Pentagon meant to revamp the entire program.
Paul Mehney, the Army's FCS spokesman, said the program would now be known as the Brigade Combat Team Modernization, but work would proceed on several FCS technologies to be fielded soon. These include small unmanned aerial and ground vehicles, unattended ground sensors, a non-line-of-sight launch system or "rockets in a box," as well as the Boeing-developed network tying it all together.
He said a Pentagon review last week had validated the FCS concept of fielding the so-called "spinouts" as a system of equipment to soldiers.
But he said Army officials were also analyzing what other capabilities combat teams needed from outside the FCS program.
A separate study would reexamine the Army's manned ground vehicle needs and map out a new way forward by September.
TERMINATION FEE TALKS
Carter is due to issue a formal acquisition decision memorandum on the FCS program this week, possibly as early as Thursday, said two officials familiar with the program.
Once the memo comes out, the Army will issue a stop-work order for the manned ground vehicle part, and start talks with the contractors about a termination fee, Mehney said.
One of the officials, who asked not to be named, said those discussions would give the Army an opportunity to rework the terms of the overall contract with Boeing and SAIC. "It throws everything back on the table," the official said. Continued...
