Pentagon: Oshkosh 'clear winner' in $1.06B deal

Oshkosh Corp. was the "clear winner" in a multibillion-dollar competition to build new blast resistant, off-road vehicles for ground forces in Afghanistan and any protests of the award likely will be defeated, a top Marine Corps official said Wednesday.

Brig. Gen. Michael Brogan praised the military panel's rigorous selection process, and said Oshkosh was unanimously picked to build the next generation of mine-resistant, ambush-protected vehicles, or MRAPs.

The Pentagon late Tuesday announced that Oshkosh won the $1.06 billion deal to build 2,244 of the MRAP-All Terrain Vehicles for use by the Army and Marine Corps. The contract ultimately could be worth nearly $3 billion for more than 5,000 vehicles.

The Oshkosh, Wisconsin-based company beat out BAE Systems _ the U.S. subsidiary of subsidiary of British defense conglomerate BAE Systems PLC _ as well as Navistar International Corp. and Force Dynamics, a joint venture between Force Protection Inc. and General Dynamics Corp.

Shares of Ladson, South Carolina-based Force Protection took the biggest hit Wednesday, falling $3.46, or 39.1 percent, to $5.38. Oshkosh shares gained $3.89, or nearly 27 percent, to $18.43.

Brogan, who manages the MRAP program and heads the Marine Corps Systems Command in Quantico, Virginia, said while the losing bidders can challenge the award, a protest is unlikely to prevail. "We are confident in the result," he said.

Navistar spokeswoman Elissa Koc said the Warrenville, Illinois-based company has yet to meet with the government to discuss the results and is not currently planning to file a protest.

In an e-mailed statement, Force Dynamics said it looks forward to meeting with the government to understand the specific decision points that led to the selection. BAE spokeswoman Jessica Pantages said the company also is waiting for its briefing before making any decisions about challenging the award.

Defense consultant Jim McAleese said it's unlikely any of the losing bidders will file a protest given that Oshkosh appears to have offered a vehicle that will save troops' lives at a much lower cost than its competitors.

Brogan said Oshkosh's vehicle proved to be most resistant to explosive blasts and its mobility was best or equal to every other offering.

The military has said it needs a hybrid armored vehicle to provide the same type of protection as the MRAPs have in Iraq. But it must be far more agile, lighter and provide increased maneuverability to handle Afghanistan's rocky terrain.

The new MRAPs are intended to replace Humvees being used in Afghanistan. However, Brogan did not rule out ground commanders using Humvees for other needs.

The first new Oshkosh vehicles will be in Afghanistan by the end of October, said Brogan.

Ten vehicles will be delivered to the government by the end of this month to equip them with electronics, perform additional testing and train troops, Brogan said.

The biggest challenge facing the program will be transporting the vehicles to Afghanistan. Brogan said he must get the initial batch of vehicles on planned flights already carrying troops and other equipment.

The Pentagon is expected to place a second order with Oshkosh valued at about $1.8 billion for 3,000 more vehicles by the end of July. That would bring the total number of ordered vehicles to 5,224.

Because the vehicle program is a top priority, Oshkosh has been asked to deliver all the vehicles by March. The company is expected to ramp up production to a 1,000 vehicles per month by December.

Brogan said he is confident the money included in the fiscal 2009 war spending bill will be enough to cover production of all 5,224 vehicles, but more funding in the upcoming budget will be required for additional services like field support, logistics and spares.