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2014-12-04 16:03:47

MEADS on the most important battlefield - Germany

     Germany have not decided yet about the direction for modernization of their air defense, a program called TLVS or Tactical Air Defense System (Ger: Taktisches LuftVerteidigunsSystem). In practical terms, there are only two options under consideration at the moment. The obstacle for the decision was a review of all modernization programs conducted on behalf of the Bundeswehr. This shift results in extra time for debate between columnists and experts - the MEADS or Raytheon? The German decision is anticipated,as it may create a domino effect in the European air defense. Other capitals will, almost certainly, follow Berlin. It is less likely though, that one of them will be Warsaw. The Polish MoD gave up on reviewing the MEADS offer for the Wisła program already in June and today does not express any interest in it. An unassisted change of that decision seems difficult for a number of reasons, mainly political and those of image. But we're walking a separate way and without the "bias of Wisła" we would like to watch this international project. It is now difficult to tell what MEADS future will be. Itself, it does not want to be shelved as an "advanced-historical" military program. Our interview Marty Coyne, director for business development at MEADS International tells something more - they're far more optimistic about the program's future than a few months earlier.

Germany first

  It is not a secret that the Medium Extended Air Defense System or MEADS enjoys a guaranteed funding only until the end of 2014. But its problem is not an early development phase or even more so not meeting the tactical-technical requirements. Having spent almost 4 bln U.S. dollars and conducting 90% of the work, the question for whom will the investment be realized, remains still open. The first and optimal client, from the timeframe point of view, seemed to be Poland and the Wisła program. At the end of June, after two technical dialogues, the public opinion has been told that the MEADS does not meet the key criteria, defined as being operational in NATO countries and offering technology cooperation.The path towards the Wisła was closed for the American-German-Italian consortium. Lockheed Martin and MBDA (German and Italian division), as creators of the MEADS International consortium partners, hope that the future decision by Germany to utilize the MEADS system components as a basis for the TLVS system will allow to continue the program after 2014. Germany was planning to take decision about the future of the air defense, effectively about the Patriots, as early as in Fall this year. But the change on the post of federal defense minister, Thomas de Maiziere had to make room for Ursula von der Leyen, and above all the criticism of the raising costs and the produced effectiveness of the Bundeswehr's modernization programs, have put the decision on hold. An audit by the KPMG, announced in October, wasn't very critical as far as the MEADS was concerned, it recommended though another analysis of the program before a decision is made. On the other hand a political pressure has risen in the recent months to speed up the steps concerning the TLVS, and members of the Parliament from the defense committee have issued a resolution to make it this year. This seems unlikely, but according to Marty Coyne of the MEADS International, it is possible in the first quarter of 2015, maybe as early as February. Politicians have begun actions for utilizing the achievements of the MEADS program. Both members of the Parliament, and the Bavarian prime minister of the ruling CSU party.

  Germany have spent on the MEADS program almost 1.2 bln EUR already, but for the politiciansit is primarily a fight for the future influence on the budget and specialized workforce, much less about federal expenditures. The MBDA Germany Ltd. headquarters is located in the Bavarian Schrobenhausen. In the recent years, in the facility that hires 1100 people, including 250 engineers, 60 mln EUR was invested in new infrastructure, including a simulation center for air defense systems. Nobody today would like to dispose that lightly. Once the KPMG report was published, the military experts have effectively begun very details talks with MEADS. According to the consortium, it's convenient to them. They have an opportunity to present the material results of their efforts, that went on for many years. It has become greatly important that one side of the project is the German industry and that specific technical data are in Germany. The KPMG has envisioned five different solutions to be considered in regard to the TLVS - 3 of them concerned the MEADS, 2 did the Raytheon. Currently, no hybrid solution is being considered, only two options are left: the MEADS or the Patriot Next Generation.

For the MEADS, most important for the next months, remain Germany. Berlin  decision may create a domino effect in the European air defense. Photo: Mariusz Cielma/Dziennik Zbrojny

  The current situation has brought a lot of optimism for MEADS. There is a timeframe and there is the system, that emerged after billions-worth of investments. The competitor has yet to face that financial and research effort. The MEADS has been rooted on the local market, as it is equally a German, as well as American or Italian system. What is also important, is the ambition by Berlin to become a NATO framework country in the field of missile defense. This requires a different approach. The system should be state-of-the-art, modular and not an upgrade to a 40-year old design.

  In the long term, a new system, developed from the scratch, would be more beneficiary for Germany. The German decision will create a domino-effect. According to MEADS, a selection favorable for them, will result in the first place in taking the decision by Italy - a consortium partner with 17% share, who due to financial reasons can not take the decision single-handedly and implement the MEADS on their own. The system will be then introduced operationally in the NATO armies. Due to the military and economical links between Germany and the Netherlands, almost certain seems selection of the MEADS as replacement for the equally aged Dutch Patriots. Romania is other interesting case pointed out by Marty Coyne. Because of the modular design concept of the Lockheed Martin/MBDA system and more tight financial capacity, Romanians are interested in a phased air defense modernization. Command and control to start with, then the radars and finally the intercepting units. Selection of the MEADS as the future German air defense system, should be finalized formally by signing a contract after roughly a year. As Coyne said, each decision will be a decision. It would heal the situation concerning funding of the program by its partners.

 An American MEADS?

  In the coming weeks the Americans will start their path to develop the tactical air defense. The Pentagon continues to develop the air defense system based on a new, integrated, network-centric battle management system (IBCS). The question remains however, which launchers and sensors will be plugged into the network. The answer should be delivered by the so called alternatives analysis, scheduled for a year, that resembles the Polish technical dialogue. Both the MEADS, Raytheon and completely different offers will be examined. It's a first step to indicate the direction, toward which the tactical air defense of the United States will strive. Needless to say that the MEADS remains very optimistic and has great expectations about the analysis - the developed system is designed from the start to be easily plugged in and seamlessly integrated (plug and fight).

 All we want is a level field

  A few months ago, when the MEADS was participating in the Wisła system procedure, the three defense attachés from the United States, Germany and Italy have submitted the Polish MoD with an intergovernmental agreement between three partners (MEADS is not strictly a business venture, but an inter-government one) regarding the approval for including Poland to the partners group on equal rights – against all other partners. Equal, because the same intellectual property rights, regardless of the level of shares, are owned by Germany (hence the idea for a hybrid MEADS-Patriot system), the U.S. and Italy. Hence also the strong position of the MEADS in Germany and Italy – they have acquired advanced technologies and have a great chance to implement them to the production stage.

  Since the decision by the Polish MoD to continue the essential negotiations only with Raytheon and the MBDA, our military have lost their interest in the MEADS. They were not present during the July tests of the system in – not so distant – Italy. The consortium itself does not press for that very strongly, it is suggesting however to rethink the criteria that were used to exclude their offer from the tender. Marty Coyne is adding that the MEADS’s offer stands still open for Poland. If only our country would uphold the requirement to deliver 6 air defense batteries in the final configuration by 2022, the MEADS could deliver them on time, in contrast to the information published by the MoD on the recent competitors. The first battery – around 4 years from signing the contract. During our interview, we were also interested in the cost issues. Although the MoD hasn’t officially raised that question, the cost could be assessed for a half of the total air defense modernization program. In case of the Wisła, we’re talking about roughly 13 bln PLN (4 bln U.S. dollars). Taking into account the common undervaluation of ambitious military programs – which refers to many defense ministries – Marty Coyne thinks that an-approximate figure is relevant in regard to the whole program of 8 batteries. And such figure was declared by the MEADS.

  The whole MEADS International offer was based on three pillars. A leading notion was to draw conclusions from the F-16 offset experience, develop partnership – not a supplier-client – relations, that was the first pillar. Another one is placing in Poland 40% of all work in research and production of the batteries. After assessment of the Polish capabilities and the timeframe, that level was indicated as rational. There’s nothing against that being higher, but there are certain consequences to that, for instance a longer implementation period for the program. An interesting element of the industrial cooperation was development in MESKO a simplified version of the PAC-3 MSE, the PAC-3 CRI and the Poland-only manufactured MCM missile (Medium Range Air Defense Complement Missile). 70% of the missile was to be built in Poland and the U.S. authorities approved the technology transfer of such an advanced technologies as the warhead’s seeker. What was to distinguish the combination of two missiles in one fire unit (an advanced missile against ballistic threats and simpler, cheaper one against classic air threats), which is advocated by many, was the range. That missile could make the majority of a few hundred planned for purchase by Poland for the Wisła systems. The third pillar is introducing the Polish companies to a large global enterprise, that creates export opportunities greater than Poland alone. The plans to acquire systems of capabilities similar to those of the MEADS are today being outlined by 15-20 countries worldwide.

  MEADS has thought their offer had met with a positive reception by the Polish side. There was nothing that indicated they were to be excluded after the technical dialogue. Curiously, director Marty Coyne doesn’t think that the Polish requirement regarding a high share in the program for the local industry results in increased expenditures. Especially over a long period. It is true that today there’s a need for investment to enhance the capabilities of the Polish defense industry, but in Poland there are lower production and labor costs, you can make savings on transport and the maintenance system that is created, will stay. This will be balanced out in the end.

  The eventual decision by Germany, that hasn’t been made yet, will allow to meet the criteria of operability in NATO armies, that are important to many. That decision will with no doubt have impact on the issues debated by the governments of Poland and Germany. All that MEADS would like is to let them fight the others on a level field. Taking into consideration the fact that the MoD since the end of June hasn’t sent any formal invitations to Raytheon nor Thales/MBDA for participation in negotiations about the Wisła program, as well as the unknown effects of the German decision and the complicating political situation in Poland – there’s nothing to rule out, in our editor’s view. But for the MEADS, most important for the next months, remain Germany.

Mariusz Cielma



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