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Are Drones About to Take Over the Sea?

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Lately, there's been a lot of talk about drones and their place in safeguarding America. And while there's still controversy surrounding their use, there's no denying that drones are an effective weapon of war -- both for spying, er "observation," and taking out enemy targets. They are so effective, in fact, that a new frontier is opening up to drone warfare -- namely, the sea. For both Raytheon (NYSE: RTN  ) and SAIC (UNKNOWN: SAI.DL  ) , this is good news.

Unmanned to the rescue
Right now there are an estimated 600 submarines from 43 countries that the Navy is responsible for tracking, according to Defense Advanced Research Projects Agency, or DARPA. Understandably, this isn't the cheapest venture for the Navy, but because of the potential security threat these subs pose, it's essential. Consequently, DARPA, along with Raytheon and SAIC, have teamed up to develop a cost-effective solution -- the Anti-Submarine Warfare Continuous Trail Unmanned Vehicle, or ACTUV. 

Scott Littlefield, project manager at DARPA, stated that the goal of the program is "to transition an operational game-changer to the Navy," at "one-tenth their cost of building subs." In total, the program costs $61 million, and while the project is still in the development phase, if successful, would allow for active and passive observation. 

Who's doing what
The project combines prime contractor SAIC's prototype trimaran vessel, with sub-contractor Raytheon's Modular Scalable Sonar System (MS3). When asked, project managers from both SAIC and Raytheon seemed pretty confident in their companies' products.  

SAIC's senior vice president and operations manager, Pete Mikhalevsky, said, "Drawing on SAIC's technical depth in marine hydrodynamics, ship design, sensors, and advanced autonomy, we're confident that the SAIC team will meet or exceed DARPA's requirements for ACTUV, a revolutionary autonomous maritime vessel." 

And Ed Hoak, Raytheon's project manager, told Business Insider that "When there's some sort of intelligence or something of interest, [the ACTUV] will autonomously move, all by itself, obeying all the rules of the road for the ocean." Upon finding "suspicious contact," the ACTUV "will trail and actively track that submarine for up to three months." 

Will it float?
Because this project is still in the development phase -- Raytheon still has a year and a half before it has to deliver the sonar system -- there's no guarantee of its success. However, as we've seen with aerial drones, and in particular Northrop Grumman's (NYSE: NOC  ) Global Hawk, if this project is successful, it could definitely be lucrative for SAIC and Raytheon. Plus, with defense contractors feeling the pinch of sequestration and defense spending cuts, new ventures in technology, especially ones that save money, are probably good for business. Consequently, investors in these companies also stand to profit.

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Related Tickers

9/30/2016 4:03 PM
NOC $213.95 Up +0.34 +0.16%
Northrop Grumman CAPS Rating: ****
RTN $136.13 Down -0.41 -0.30%
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SAI.DL $0.00 Down +0.00 +0.00%
SAIC CAPS Rating: ***