Skunk Works Solution Provider...JSF X-36 JSF X-37 C-17 F-18 E/F JSF EMD UCAV F-22 F-35 UCLASS? F-35...
Transcript of Skunk Works Solution Provider...JSF X-36 JSF X-37 C-17 F-18 E/F JSF EMD UCAV F-22 F-35 UCLASS? F-35...
Create and Deliver Superior Products Through Innovative Minds
Solutions
Missions Technology
Skunk Works – Solution Provider
Approved for Public Release
© 2009 Lockheed Martin Corporation
Create and Deliver Superior Products Through Innovative Minds
Solutions
Missions Technology
Skunk Works – Solution Provider
2
Trends & Challenges
– Declining Support for Defense Spending
– Defense Budgets - Product Implications
– Globalization of the Supplier Base
– Aversion to Risk
– Future Shortage of Skilled Workers?
Dynamic industry requires dynamic response
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A&D Economic Contributions
(AIA, Bureau of Labor Statistics, National Science Foundation)
Keeping America Competitive
around the Globe
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8
9
10
11
12
13
14
94 96 98 00 02 04 06 08
Milit
ary
Aero
sp
ace E
xp
ort
s M
($B
)
Billions in Defense Exports
Providing Quality Employment
0
5
10
15
20
25
30
Pro
du
cti
on
Wo
rkers
:
Av
era
ge H
ou
rly E
arn
ing
s (
08$)
11
16 18
19 20
21 22
30 Competitive Compensation
0
200
400
600
800
1000
1200
91 94 97 00 03 06 09
Aero
sp
ace W
ork
ers
(th
ou
san
ds)
Hundreds of Thousands of Jobs
• Aerospace R&D Investment 13.3% of Sales
Versus 2.9% Industry Average
• Average Aerospace Compensation $38K
per year with A&D at $62K per year
• Significant Pressure for Global Suppliers
Fueled by Many Factors, Wages Being One
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10%
20%
30%
40%
50%
60%
70%
80%
90%
1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010
DoD Budget as % of Total Federal Budget 1940-2011 (DOD)
Source: National Defense Budget Estimates for FY2011, Office of the Undersecretary of Defense (Comptroller), March 2010
Defense Investment as a Percentage of
Total Federal Budget
Cold War Vietnam Korea GWOT WW 2
XP-5Y
A-2D
XC-120
F-4D
F-8H
B-52
A-3D
X-3
S-2F
X-2
F-10F
F-100
F-2Y
B-57
F-102
R-3Y1
F-104
A-4D
B-66
F-11F
C-130
F-101
T-37
XF-Y
F-8U
F-6M1
U-2
SY-3
F-105
X-13
C-133
F-107
B-58
F-106
X-14
F-5D
C-140
T-2
F-4
A-5
T-39
T-38
AQ-1
X-15
F-5A
X-1B
A-6
B-52
SR-71
SC-4A
X-21
X-19
C-141
B-70
F-14
C-5
S-8
YA-9
A-10
F-15
F-18
F-117
F-20
X-29
C-5B
F-22EMD
YF-22
YF-23
JSF X-32
JSF X-35
C-17
JSF-SDD
UCAV
JCA
K-CX ?
NGB ?
XC-142
F-111
A-7
OV-10
X-22
X-26B
X-5A
X-24
T-46
T-45
B-2
V-22
YF-17
B-1
YC-15
YC-14
AV-8B
F/A-18
Average %
Korea 35.3
Vietnam 46.2
Cold War 38.9
GWOT 18.3
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0%
5%
10%
15%
20%
25%
30%
35%
40%
1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010
DoD Budget as % of GDP 1940-2009 (DOD)
Cold War Vietnam Korea GWOT WW 2
Defense Investment as a Percentage of
Gross Domestic Product
XP-5Y
A-2D
XC-120
F-4D
F-8H
B-52
A-3D
X-3
S-2F
X-2
F-10F
F-100
F-2Y
B-57
F-102
R-3Y1
F-104
A-4D
B-66
F-11F
C-130
F-101
T-37
XF-Y
F-8U
F-6M1
U-2
SY-3
F-105
X-13
C-133
F-107
B-58
F-106
X-14
F-5D
C-140
T-2
F-4
A-5
T-39
T-38
AQ-1
X-15
F-5A
X-1B
A-6
B-52
SR-71
SC-4A
X-21
X-19
C-141
B-70
F-14
C-5
S-8
YA-9
A-10
F-15
F-18
F-117
F-20
X-29
C-5B
F-22EMD
YF-22
YF-23
JSF X-32
JSF X-35
C-17
JSF-SDD
UCAV
JCA
K-CX ?
NGB ?
XC-142
F-111
A-7
OV-10
X-22
X-26B
X-5A
X-24
T-46
T-45
B-2
V-22
YF-17
B-1
YC-15
YC-14
AV-8B
F/A-18
Average %
Korea 6.7
Vietnam 8.3
Cold War 7.4
GWOT 3.8
Source: National Defense Budget Estimates for FY2011, Office of the Undersecretary of Defense (Comptroller), March 2010
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Defense Investment Implications – Industry
Consolidation
1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2007 2008
LOCKHEED MARTIN Lockheed
GD Ft. Worth
Martin Marietta GE Aerospace
GD Space
Loral
LTV Missiles
IBM Federal
Comsat
SAVI
PAE
Acculight
Unitech
ACS
Northrop
Grumman
Westinghouse
Logicon
Litton
Newport News
TRW
Essex 3001 Int’l Raytheon
BAe Corporate Jets
E-Systems
GM-Hughes
GD Missiles
Texas Instruments
Boeing Australia Flight Options
Sarcos Research SI Govt
Boeing
Rockwell
McDonnell Douglas
Hughes S&C
Aviall
Insitu General Dynamics
GulfStream
Motorola IISG
GM Defense
Veridian
United Defense
Anteon & FCBS
SNC
Jet Aviation Group
NORTHROP GRUMMAN
RAYTHEON
BOEING
GENERAL DYNAMICS
Reduced Demand - Reshaped the Primes
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• Typically primes perform 30% of work
content
• Critical systems and materials
suppliers
• Companies in all 50 states & worldwide
• Includes small, disadvantaged and
minority-owned businesses
• Experience base across industry being
lost at an alarming rate
• Cost concerns have reduced capability Lower-Tier
Suppliers
Sub-Primes &
Systems Partners
Global Primes
A&D Industry Make-Up
Globalization Has Significantly Changed Supplier Landscape
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The Challenge of People
1950’s 1960’s 1970’s 1980’s 1990’s 2000’s 2010’s 2020’s 2030’s
XP-5y
A-2D
XC-120
F-4D
F-3H
B-52
A-3D
X-3
S-2F
X-2
F-10F
F-2Y
F-100
B-57
F-102
R-3Y1
F-104
A4D
B-66
F-11F
C-130
F-101
T-37
A-6
B-52
SR-71
SC-4A
X-21
X-19
C-141
B-70
XC-142
F-111
A-7
OV-10
X-22
X-26B
X-5A
X-24
F-14
S-8
YA-9
A-10
F-15
F-18
YF-17
B-1
YC-15
YC-14
AV-8B
F/A-18
F-117
F-20
X-29
T-46
T-45
B-2
V-22
F-22 EMD
YF-22
YF-23
JSF X-36
JSF X-37
C-17
F-18 E/F
JSF EMD
UCAV
F-22
F-35
UCLASS? F-35
40 Year Career Span – Multi Starts
Multi Program Experience
6+ Program Experience
Retired
Retired
Retired
1-2 Program Experience Close to Retirement
1 Program Experience Very Few
XF-Y
F-8U
F-6M1
U-2
SY-3
F-105
X-13
C-133
F-107
B-58
F-106
F-5D
X-14
C-140
T-2
F-4
A-5
T-39
T-38
AQ-1
X-15
F-5A
X-1B
Declining Experience Levels in Military Aircraft Programs
(Vertical Bars: Military Aircraft Programs Starts, Horizontal Bars: Typical 40 Year Career Span
B-X
The Next Gen Engineer
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LM Aero Engineering Workforce
Age
0
200
400
600
800
1000
1200
1400
1600
1800
2000
0 - 25 25 - 30 30 - 35 35 - 40 40 - 45 45 - 50 50 - 55 55 - 60 60 - 65 65 -
Age Distribution
Chief Eng
Test Labs
Flight Ops
Signature Tech
Airframe Design
Avionics
Air Vehicle Science
Software Engr
Systems Engr
Process & Tools
Engr Integ Stff
Engr VP
Eligible for Retirement: 15.2%
and Growing
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Mathematics Scores
1973 1996 1999 2004 2008 1990 1992 1994 1978 1982 1986
9 yr olds
13 yr olds
17 yr olds
Average mathematics scale scores on the long-term trend
National Assessment of Education Progress (NAEP), by age
Original Assessment format Revised Assessment format
Scores of High School Graduates in Math Have Remained Relatively Flat
Source: U.S. Depart. of Education
Test
Based
on
a S
co
re o
f 500
500
325
250
225
200
300
275
Create and Deliver Superior Products Through Innovative Minds
Solutions
Missions Technology
Skunk Works – Solution Provider
Approved for Public Release
© 2009 Lockheed Martin Corporation
Create and Deliver Superior Products Through Innovative Minds
Solutions
Missions Technology
12
Back up
13
A Shrinking Pool of Skilled Labor?
As the A&D Workforce
is Expected to Decline
(Aviation Week)
0%
5%
10%
15%
20%
25%
30%
Engineering Research &
Development
Manufacturing
Labor
Program
Management
Eli
gib
le t
o R
eti
re
Workforce Eligible to Retire by 2013
Workforce Age Distribution
Under 35
35-49
Over 50
38%
39%
23%
New Science & Engineering Talent
(Department of Education)
Science and Engineering as % of Total U.S.
Undergraduate Degrees
6%
7%
8%
9%
10%
11%
89 92 95 98 01 04 07
Declining Popularity of Science and
Engineering Among Undergraduates
A&D Workforce Dilemma