Reviewing the Department of Defense's daily digest of contract awards (as one does), you tend to get a good idea of who "the usual suspects" are at the Pentagon. Big defense names like RTX, Lockheed Martin, and Northrop Grumman make regular appearances on the list; big tech names like Microsoft or Palantir or Amazon Web Services will also pop up from time to time, hired to do military IT work. And then, every so often, an entirely unfamiliar name will arrive that causes you to sit up and take notice.
That's what happened for me last week, when Liquid Robotics appeared on the list.
Searching through the archives for the past 10 years, it turns out last week was the first time ever Liquid Robotics won a contract big enough to show up on the Pentagon's list (which covers all contracts $7.5 million and up). So what exactly is Liquid Robotics, I wondered?
And what does it do?
And why is the Japanese navy buying drone ships from it?
Image source: Liquid Robotics.
Japan loves robots
Because that's the substance of the contract I had stumbled upon. For $25 million, the U.S. Air Force had contracted to purchase 20 commercial unmanned surface vehicles (that's military-speak for drone warships) from Liquid Robotics, apparently for delivery to Japan as a Foreign Military Sale.
It took a bit of digging, but in short order, all was made clear.
Liquid Robotics, it turns out, is a subsidiary of Pentagon megacontractor Boeing (BA 4.29%), which bought the company back in December 2016 as "a market leader in autonomous maritime systems and developer of the Wave Glider ocean surface robot." It now resides within Boeing's Defense, Space & Security division.
Liquid Robotics makes only one product, the Wave Glider USV (which makes it pretty clear which "commercial unmanned surface vehicles" Japan is buying). Liquid Robotics describes the Wave Glider as a "low-observable, mobile platform that enables over-the-horizon surveillance with both surface and sub-surface payloads." Although even the largest Wave Glider (SV5) measures only 15 feet in length, it can tow sonar to detect threats underwater, even as it carries sensors and communications gear topside to detect surface and air threats -- and transmit this data back to base.
Powered by solar panels and wave energy, the vessels are capable of operating autonomously for as long as 12 months at a time and in any environment, including sailing through doldrums, hurricanes, typhoons, and even Arctic conditions. Wave Gliders aren't speedy, with a maximum speed of just two knots, but they have long endurance; at least one has successfully traveled in excess of 9,300 nautical miles on a single trip.
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Key Data Points
What does this contract mean for Boeing?
At just $25 million in value, the Japanese Wave Glider contract is just a very small fish swimming within Boeing's $89.5 billion annual revenue stream. It's still probably a nice, profitable little business for Boeing.
Back when Boeing bought the company, Liquid Robotics was selling Wave Gliders for just $300,000 apiece. The company's new Japanese contract, meanwhile, implies the per-unit cost has nearly tripled in 10 years, to more than $830,000.
Even at the new and improved price, the Navy -- both Japan's and our own -- can probably afford to buy quite a lot of them.
