Sequestration and the onerous effort required to do government contracting is causing many Air Force suppliers at the second tier and below to “walk away,” Boeing Defense President Chris Chadwick said Wednesday. Speaking at AFA’s Air & Space Conference in National Harbor, Md., Chadwick said “they’re walking away for a number of reasons: sequestration, budget cuts,” and the fact that “the cost of doing business with the US government is not for the faint of heart.” Suppliers are “choosing to go … where the market’s more stable (and) the opportunity has more upside.” For Boeing, this has meant pulling suppliers into the company, also known as vertical integration. Also, “we’ve established new suppliers. There are often opportunities, especially in the small/disadvantaged business arena, where we can team with entrepeneurs and new businesses to create new capabilities,” he said.
The Space Development Agency says it’s on track to issue its next batch of missile warning and tracking satellite contracts this month after those awards were delayed by the Pentagon’s decision to divert funds from the agency to pay troops during this fall’s prolonged government shutdown.
