COLOGNE, Germany – Germany’s Ministry of Defense will abandon planned air defense investments and other high-profile programs involving US vendors that have not been resolved in the final months of Merkel’s administration, officials have told lawmakers.
The February 3 list of “essential” but not funded programs, as officials wrote, includes some of the trans-Atlantic defense efforts that have simmered for some time. As a result, American contractors Lockheed Martin and Boeing were left waiting until the new government filed a lawsuit over the posture of the German defense acquisition sometime after the September 26 election.
Lockheed Martin, along with MBDA Deutschland, have been eyeing a contract at TLVS missile defense following more than a year of negotiations and several years of German-American joint development. The prospects for the program turned dim last fall, as new requirements raised costs. Unsurprisingly, TLVS has now officially appeared on the duty roster for the next chancellor.
In particular, a project that aims to defend against short-range aerial threats, such as drones or mortar fire, is also under budget, defense officials wrote to lawmakers.
Defense Minister Annegret Kramp-Karrenbauer late last year reframed German air defense requirements requiring a greater focus on the drone threat, as evidenced by Nagorno-Karabakh conflict. He said a wholesale evaluation of the entire weapons portfolio will determine the way forward, including what systems the Bundeswehr needs to counter threats of different sizes from various distances.
Whatever happened to the review, it doesn’t seem like it sparked the urge to start something new right away. That leaves Germany’s Patriot systems fleet, along with a limited order for counter-drone systems made by Kongsberg and Hensoldt aimed at fulfilling Germany’s commitments to NATO for 2023, as basic equipment for now.
Lockheed will also have to await what happens next in the Bundeswehr heavy transport helicopter program, which is intended to replace its fleet of CH-53G models. Ministry of Defense effectively stop the acquisition last fall’s process after Lockheed and Boeing over budgeted with their special offers of the CH-53K King Stallion and CH-47 Chinook, respectively.
German defense officials recently requested information from the US Defense Security Cooperation Agency about purchasing a more standard, and possibly cheaper, version of the desired aircraft.
In response, Lockheed launched an official protest, now in the pockets of the Federal Cartel Office, as first reported by Die Welt newspaper. Company officials said they wanted to get a decision on whether Berlin to abandon purchases altogether in line with fair competition rules.
Germany’s acquisition law makes it difficult for companies to protest when the government chooses not to award any contracts at the end of the competition, said Christian Scherer, a public procurement expert at German law firm CMS in Cologne. “In general, you can’t force the government to buy anything,” he said. “But the bidder may have a claim for compensation.”
Judging an offer that is not economically viable, for example, could qualify as a legitimate reason for the government to back down, Scherer told Defense News.
At the same time, there are legal recourse if the company suspects rule violation, especially if the government’s requirements remain the same, he added. These rules exist to protect bidders against favoritism and other forms of manipulation. “You cannot go on and compete against the same thing with the intention of awarding the contract to the bidder of your choice.”
Finally, Germany’s long-term campaign to replace its fleet of Tornado fighters will remain untouched during the final months of the Merkel era, according to the Defense Ministry. Defense officials last spring selected a mixed fleet consisting mostly of Eurofighters plus a small number of Boeing Super Hornets for electronic warfare and nuclear missions.
The decision has turned into something more akin to a mere recommendation that will take years to play out, leading Eurofighter maker Airbus hopes that the US manufacturer can be completely removed from business when all is said and done.
Tobias Lindner, a member of the Green Party’s Budget and Allocation Committee in the Bundestag, said the list of unfunded programs was “almost more attractive” than acquisitions deemed feasible by the time the Bundestag session ends in late June.
With so many big ticket programs in uncertainty (15 overall), Kramp-Karrenbauer can move on to setting priorities and cutting out unnecessary projects. “Unrealistic announcements and promises weaken confidence within the armed forces and with our allies,” said Lindner.