Inside the Army’s push to modernize manufacturing and rebuild capacity

I am Jen Judson, land warfare reporter for Defense News, and I am here with Lieutenant General Christopher Mohan, Acting Army Material Command Commander

General, thank you so much for joining me here at AUSA. Army leadership requested a 90-day review of the organic industrial base, along with, you know, they want you to make some recommendations, produce, I think, a study from that

So walk me through that effort. Where are you now? What's still in the works

And what do you for sure know you're going to need out of the organic industrial base

And where do you think your recommendations are headed? Yeah, so thanks for the opportunity to come talk to you as well, Jen

I always enjoy these sessions. So the OIB study is our effort to really chart the future of the organic industrial base from what the output is going to be

We've been on a, we're three years into a 15-year process to modernize

but we've spent a lot of time and a lot of money on just modernizing the physical plant

Power lines, you know, infrastructure, et cetera, et cetera. And so now we're focused on, okay, what is the output that is required from the organic industrial base

Because we've got some challenges. You know, so our rates continue to rise, which makes us non-competitive with other facilities, other companies, et cetera

And we don't want to compete, right? We want to get the things in the organic industrial base, the capability that the United States of America absolutely needs to have organically

So we've got to figure that out. But what we've seen is a significant reduction in the amount of workload

As we've modernized, we've bought new kit, we just haven't been doing rebuilds and remanufacturing of a lot of different things

And so we're scoping the problem out. The other thing that we're doing with this is that, look, real estate, location, location, location

Our organic industrial-based facilities, a lot of them sit astride not only strategic transportation nodes

because that's why they were built in the first place, trafficability, but also they have access to water, have access to power

So we've gone through and we've identified as part of this. We've visited every single one of our bases

We're collecting data from quantitative and also doing interviews with leaders. But we're looking for targets of where we can attract private industry to come in and take advantage of real estate that we have and the capability that we have

And so we've identified several opportunities, data centers, rare earth minerals, storage and shipping, which we do already

And so we've identified those. And so we're about 60 days in

My requirement is to give a back brief to the Army leadership, to Army senior leaders, the middle of next month

And then we'll take that across the hill or across the river to the hill

We have already given them a kind of, hey, here's our first look of some of the challenges we have

But the end state is to reimagine and then deliver to the Army leaders, our Army leaders, concrete things that we can do to make the OIV better

Okay. Talk a little bit more about the workload, the workforce. You know, that's a pretty tough problem

You're competing with the commercial sector. what are some of the challenges specifically related to that

And have you identified any potential areas where you could find improvement when it comes to that Yeah so we got examples of where we have taken risk as a command and said hey we going to do this because we see readiness challenges and really re money

So the biggest one we have right now is our operational readiness program

It's a pilot program we're doing in conjunction with FORSCOM that really focuses the output of the OIB not from a fleet-based model but to a unit-based model

units going to go overseas, what can we do to make them as lethal as possible so when they get to

General Donahue in Europe that he has a brigade that is the most lethal brigade that we can give

him. And so we've seen that as a model that has led to the Army recognizing that, hey, this is a

good thing. And so we got more money. And so then when we get more money, we do more rotations

more brigades, which then allows us to smooth the supply chain. So we're rebuilding Abrams

Bradley's, M88's, PLS's, etc. So for the 1st Brigade of 1st Infantry Division we did 58

different systems. So nine Abrams, nine Bradley's, etc. etc. Which then allowed them

as one of the oldest fleets in the Army, before they went to Europe they had the highest readiness

rate of any brigade in the Army. And so along with giving them new vehicles we also give them

training and we give them extra maintenance capability but the training piece is really

is really positive so we see this as a model and the army's recognized it so so this coming year

we will do our first rebuild of m88s in about 15 years where we're going to do a big program

you need to do now because you don't the readiness is challenged plan for absolutely yeah so we've

cut the 88A3. And the A2 now is a challenged fleet force. And so not only are we going to do

the rebuild program at Anniston, but right now at NIAIR, National Institute for Avionics Research

a strategic partner of ours, we sent them an 88 about 60 days ago. And they are taking it apart

and digitally scanning every part on that 88 to create a digital twin that is designed for

advanced manufacturing. And so we will be able to, and we've already given the list, hey, here are

the parts that we have that are challenged in the supply chain. And they are helping us so that we

can advance manufacture those parts to feed the production line, which will then feed the units

you know, and smooth that supply chain out. Okay. Speaking of supply chain, broadly

not just M88s, but across the board, what are some of your biggest concerns when it comes to

supply chain when you're trying to, say, mass-produce drones or add to the stockpiles of our

munitions, for instance. What are some of the things that you're concerned about? You talked about how there's potential for partnerships on an installation for rare earths

activity there. That industry doesn't really exist in the U.S., so how are you getting after some of

these big problems? that rarest isn't everything. Yeah, so just for the rarest example, look, we not only have the real estate

if there is a company that wants to put a facility on one of our organic industrial-based sites

but there's also, in some cases, we sit atop things we're really interested in, like lithium

And so the idea of saying, yes, you can build this facility on one of our depots

mine the lithium, and then as payment in kind, we get lithium to feed our battery production

which we in the process of ramping up our UAS program So we gonna build hopefully by this time next year we be building 10 a month And so that a significant amount of battery capability we need to build

The other piece that I will tell you about our supply chain is that we're working very hard

for a traditional class 9 repair parts to not only bring all the parts that we have

out in units to record so we can see them, but also to rebuild the strategic depth that we lost in the COVID years

And so we're establishing additional theater stockages in CONUS to complement what we have overseas as well

And we're doing that as strategic transportation hubs in the United States

That's very interesting. In terms of mass-producing drones, you have an effort that you are engaged in to ramp up the drone production within the organic industrial base

I made it out to Rock Island to see part of that. So talk about what you're trying to achieve there, and are you running into any challenges at this point to get to where you want to go

Yeah, so we've got a Group 2 UAS. You've seen it. We just shipped our first 25 systems to the National Training Center

We have enough kit right now to build 1,000 of them. And what you'll see in the very first ones is we just did the assembly

We're learning how to, we know how to build things, but we've never built drones before

and we've only been doing this for about six months. But as we ramp up our manufacturing capability, we're going to replace the parts

to the point where we get to a UAS that there are very little, very few commercial parts that we have to buy

Now, some things we're not going to manufacture. Cameras. There's U.S. sources for the small cameras

You heard the Vice talk about the controllers and the goggles. That's a two- or three-year sprint

But if we find enough U.S. manufacturers, we won't do that. But the bodies, we're already manufacturing the bodies

We're doing the wiring harnesses. We 3D print microelectronics already. And so we just have to scale that

The brushless motors, I would love to say that we have the machinery on order, but because we have no budget

we need $75 million to buy the equipment to manufacture the brushless motors, and we have no budget

It's going to hold up the whole process. And everybody else is competing for that same machinery

And so it continues to slip to the right. And so that's a challenge for us

But the end state is that we are shipping low-cost drones to multiple places in the Army

So I mentioned NTC. JRTC is next after that. First Corps is after that

And the Army G3 is telling us where to ship systems and how many

Okay. You know, you're doing a lot of things differently or trying to get started on doing things differently within the industrial base

What are the concerns coming from the industry? Where are you hearing maybe some concerns about competition with the organic industrial base

And what do you say to industry who are expressing that worry

We have to partner. So for Sky Foundry, Sky Foundry is more than just a location

It's a network of capability. And so we see space. Is 10,000 drones enough for the United States Army

I don't know. I don't know. if you look at what our potential adversaries

are producing, it's not enough. And so there is space in here in this concept

to get to buy and to partner with industry particularly small companies What if a small company has a really great idea but doesn have the manufacturing capability and then they can come into the organic industrial base

and get access to the great capability we have? I mean, there's tons of opportunities there

For things like right to repair, I think the secretary was very clear yesterday

and my message to industry is, look, we want to get to this

where we have the tech data because it saves us a lot of time. But if not, and we can't get the parts, hey, don't be surprised when we just start fixing things and building parts

Because we're doing it already. We can't wait. We cannot wait. I'm going to shift gears for the last question

I know that we have many viewers who are interested in the recent steps that you're taking to improve the dining experience for soldiers on post

So tell us more about what you are doing with that initiative. Yeah, so our campus-style dining venue initiative is simple

We have to improve the quality of food. And you heard the secretary talk about it yesterday, 1936, the Randolph-Shepard Act

which started out as canteens, where cigarettes and coffee, right? Blind vendors authorized to sell cigarettes and coffee on federal installations

Then it morphed into, well, canteens became more, snack bars. And then it morphed into cafeterias

And then there was some action taken years ago that said, hey, military dining facilities should be considered cafeterias

And that was a legal action taken by our own people, right

And so then the Randolph-Shepard Act, we don't contract with a vast majority of our dining facilities

We don't contract with companies. We sign contracts with states. in the states then become the prime contractor, and they sub it out to these small businesses

that in some cases are just shell companies for other businesses. I mean, the contracts cost us 30% more

They prevent us from getting the large-scale management like you see at our college campuses

And I think as a taxpayer who's had a bunch of kids go to college

our soldiers deserve just as good or better than my kids did at the University of Alabama

And the reality is, Jen, is that the University of Alabama feeds them cheaper, much higher quality

than we're doing for our own soldiers. And so the secretary has led the charge in breaking that model

And so what you're going to see is a dining facility that is much more open and welcoming

a minimum of five stations, a dietician on staff, a professional chef running it

And the model is the more people they feed, the more money they make

So it's not a set-based capability like we have right now. We have blown the model up

And so we believe that when you bring those commercial practices in, they will be incentivized

And the more people you feed, the more money you make. We've got a great industry partner who Compass out of North Carolina who does college campuses

They do your airport lounges. They have the industrial management, and they're very high quality

And we're five locations. The first one open in January time frame, probably at Fort Hood

We were going to go to Fort Bragg first, but probably we'll go to Fort Hood, and we're going to try to do them simultaneously

Okay. All right. Well, hopefully everyone starts to get better. And we're writing the next contract for the next tranche

Okay. Because the Army said, hey, Mohan, go fast. Okay. And so we're going to go fast

All right. Well, thank you so much for joining me here at AUSA

I hope you enjoy the rest of your show. Absolutely. Thanks, Jen. Really appreciate it