Weekly News Update: Jan 19, 2024
13 - 19 Jan 2024
Good morning,
The Department of Defense has finally released the long awaited, inaugural National Defense Industrial Strategy. Unfortunately, strategies typically connect ends, ways, and means, and the NDIS is a bit light on ways and means. Congress still proves unable to pass a budget, although it’s passed yet another continuing resolution to kick the can down the road. Iran and Pakistan are trading missile attacks, ostensibly against militants in one another’s countries. Pakistan has also launched attacks against Iranian-backed Houthis. POTUS (President of the United States) has stated that US strikes against the Houthis will continue, as the US adds the rebel group back to the list of specially designated global terrorist organizations. Japan has reached the moon! OpenAI, the maker of ChatGPT, has reversed its previous position and is now working with the US military. The EU seeks to jumpstart its DefenseTech ecosystem creating a $191M fund. And, I’m not sure what’s prompted it but there’s a flurry of activity in the aviation subsector, with plenty of consolidation attempts underway.
Finally, it’s BAA season. Lots of Broad Agency Announcements are dropping, providing opportunities for tech companies. Make sure to check that section out.
Let’s dive in to these and other issues surrounding aerospace and defense technology.
Weekly News Round Up
Military
U.S. Defense modernization and innovation
Congress passes third continuing resolution, instead of full FY24 budget (DN)
Pentagon restarts meetings to implement new industrial strategy (DN)
Commission: Defense innovation hindered by Cold War-era practices (DN)
Pentagon goes green with rooftop solar panels (MT)
Marines rush to field two air defense systems amid global tensions (DN)
Four Navy unmanned ships return from months-long exercise in Pacific (BD)
Secretary of the Navy Del Toro orders ‘ comprehensive’ shipbuilding review (BD)
Defense Tech Opportunities
Investors hunt ‘war-winning’ tech in Ukraine (DO)
USAF Research Lab has released a BAA for its rocket propulsion division (SAM)
Navy looks for cost-saving ideas in Running Fix efficiency effort (USN)
NASA released their Phase 1 SBIR for FY24, responses due March 11 (SAM)
The NGA has released a BAA for its Boosting Innovative GEOINT-Science and Technology (BIG-ST) effort (SAM)
The Pentagon’s Strategic Capabilities Office has issued a BAA focused on autonomous systems, deep learning, cyber, cross-domain kill chains, and non-traditional defense technologies (SAM)
The Air Force is seeking sources for work related to 13 munitions related research areas (SAM)
Europe, Russia, the Arctic, NATO, and the war in Ukraine
NATO to hold biggest exercise in decades, involving 90k (MT)
US military can’t sustain, let alone dominate, Arctic operations (TWH)
Russia hosts N. Korea’s top diplomat for talks on ties amid concerns over alleged arms deal (AP)
Britain pledges $3.2Bn for Ukraine military aid in 2024 (DN)
China, Korea, and Asia
Taiwan reports first major Chinese military activity after election (RT)
China’s population drops for a 2nd year, raises long-term growth concerns (RT)
House members warn White House over AUKUS, attack sub procurement (USNI)
Kim: N. Korea no longer interested in reconciliation with South because of hostilities (AP)
Middle East and Africa
Biden: ‘US strikes against Houthi rebels will continue’ (MT)
Back on the list: US relists Houthis as specially designated global terrorists (AP)
Iran, Pakistan launch strikes against militants on one another’s soil (CNN)
Iran launches air defense drill amid regional tensions (RT)
Iran’s new missile program is gaining international attention (NYT)
White House troubled by deal between Ethiopia and breakaway Somaliland region (VOA)
Rwanda says it killed Congolese soldier who crossed the border, heightening tensions (AP)
U.S. Defense Industry News
US likely to levy higher penalties for export-control violations (WSJ)
BlackSky wins PT Lens contract to support Indonesian government (SWG)
Lockheed to test Patriot and Aegis integration in live-fire test (DN)
DARPA selects Mynaric for Phase 2 of Space-BACN space comms program (VS)
Northrop Grumman’s new ICBM has ‘critical’ cost and schedule overruns, needs SecDef certification to continue (ASF)
Northrop test-fires the second-stage solid-rocket motor for the new LGM-35A Sentinel missile (C4)
Sierra Space joins Lockheed, L3Harris on $2.5B contract to provide 54 satellites for SDA (C4)
Foreign military sales include:
Foreign Defense Industry News
Australia to manufacture its own guided missiles starting 2025 (S&S)
France buys 42 Rafale jets from Dassault Aviation in $5.5Bn deal (DN)
Rheinmetall Canada, Elistair pair robots and drones in test for Europe (DN)
Pakistan claims it has hypersonic-capable missile (DN)
Spain buys Rheinmetall munitions amid calls for more ammo production (DN)
UAE’s EDGE Group, Turkey’s Bayraktar collaborate on bombs for drones (DN)
UK begins next-gen Eurofighter Typhoon radar integration, eyeing powerful EW capabilities (BD)
Space
DoD rewrites classification policy for secret space programs (C4)
Space based solar power project ends first in-space mission with successes and lessons (CT)
Space investors banking on funding uptick in 2024 (SN)
ESA’s Mars Express Orbiter found further evidence of water on the Red Planet (ESA)
Japan’s Moon Sniper lunar lander touched down on the moon, making Japan the fifth country to reach the lunar surface (For)
Nuclear Power & Weapons
Russia shoots down US proposal to restart nuclear arms control talks (TH)
N. Korea says it tested a nuclear-capable underwater system (AP)
Belarus develops new doctrine incorporating nuclear weapons (DN)
AI, Robotics, & other Frontier Tech
AI-enabled Valkyrie drone teases future of US Air Force fleet (C4)
US, UK experts: transforming the military for the AI age requires ruthlessness (BD)
Army aims to democratize data with Army Data Platform 2.0 (BD)
OpenAI is working with US Military on cybersecurity tools (BBG)
Pins, monocles and sunglasses: the rise of AI-focused hardware (BBG)
Microsoft CEO Satya Nadella says consensus on AI is emerging (CNBC)
A&D-Focused Finance
The European Commission and the European Investment Fund have launched a $192M defense tech fund to boost security innovation (RT)
Belgian technology company John Cockerill Group to buy French military vehicle manufacturer Arquus from Volvo Group in a $327M deal (BD)
American defense giant RTX threatens legal action against the Italian government for blocking the $1.8Bn sale of Microtecnica unit to French firm Safran (DN)
Aerospace and Defense manufacturer RTC Aerospace, backed by PE firm Stellex Capital Management, acquires Vanderhorst Brothers Industries (BW)
D-Orbit raises $110M to expand space logistics services in a Series C led by Japanese company Marubeni Corporation (SN)
Weavix, a startup developing ‘smart’ radios for frontline workers, raised a $23.6M round led by Insight Partners (TC)
FlyORO, a Singapore-based sustainable aviation fuel startup, raised a $1.6M pre-Series A round led by Audacy Ventures (FN)
Spirit Airlines is seeking to refinance ~$1.1B of debt due in September 2025 but is not seeking a bankruptcy-driven restructuring (BBG & WSJ)
A federal judge blocked JetBlue Airway’s planned $3.8B acquisition of ultra-low-cost carrier Spirit Airlines due to competition concerns and harm to consumers; Spirit shares fell ~47% (RT)
British Airways owner IAG expects EU antitrust regulators to open a full-scale investigation into its $436M plan to buy Spain's Air Europa and will offer remedies (RT)
German carrier Lufthansa’s bid for a minority stake in ITA Airways is set to face a full-scale EU competition inquiry (RT)
Korean Air is expected to win EU antitrust approval to buy Asiana Airlines after pledging to sell the latter's cargo unit and divest routes to four European cities (RT)
Indonesia’s largest private carrier, PT Lion Mentari Airlines, is considering reviving an IPO in Jakarta that could raise as much as $500M (BBG)
Air Astana, Kazakhstan’s flagship carrier, will proceed with a long-delayed IPO both in the UK and at home to fund expansion (BBG)
Brazilian airline Gol is considering filing for US Chapter 11 bankruptcy within the next month (RT)
RocketStar, an NYC-based space exploration and satellite services startup, raised a $2M seed round (FN)
Important Reads
John Hardie explores the growth and limitations of Russia’s munitions production.
Shana Marshall argues that the Pentagon is ill-equipped to responsibly navigate the competiting interests between defense primes and VC-backed tech companies.
The Mitchell Institute advocates for more money and people to allow the Space Force to secure cislunar space.
Chris Arnade wrote a great piece on the decline of US infrastructure vs other developed nations.
Lighter Side
Keep building!
Andrew