WASHINGTON — The U.S. Space Force’s main procurement arm, the Space and Missile Systems Center in Los Angeles, shifted into telework mode more than a week ago, as did many of its contractors. But as the state of California moved to shut down non-essential businesses during the coronavirus outbreak, SMC worked with state and local authorities to make sure facilities that manufacture satellites, launch vehicles and other critical equipment stayed open.
“We had to ensure authorities are aware that the work that our contractors are doing is really critical for the nation’s defense,” Lt. Gen. John Thompson, commander of the Space and Missile Systems Center, told SpaceNews March 25 in an interview from his home office.
Thompson said a DoD memo signed last week by Undersecretary of Defense for Acquisition and Sustainment Ellen Lord — declaring defense suppliers critical infrastructure — was an important move that helped avert closures. “We worked very closely last week with Santa Clara County in California, for example, to help Lockheed Martin and ensure the county knew the work done at Sunnyvale is critical to national defense.”
The same help is being extended to smaller companies and subcontractors that may not be aware that their work is “mission essential for DoD” and need to stay open, Thompson said.
SMC also intends to keep up the flow of contracts to small businesses during the crisis. “Many of our nontraditional small contractors have commercial solutions that we want to try to bring into the defense acquisition ecosystem,” said Thompson. Long before the pandemic, SMC was “already a major player in that.”
Along with other space procurement organizations across DoD, “it’s definitely a priority for us to keep those innovative small companies in play as much as possible with the available budget we have,” Thompson said.
A key concern is the possibility that foreign investors from nations considered adversaries of the United States will move in to rescue ailing space companies during this crisis and try to capture their technology, said Thompson. Foreign investments in U.S. companies that develop cutting-edge technology has caused alarm for some time, he said. “But the pandemic could actually make it worse. We are very concerned about foreign investment in a lot of the industrial base that we deal with every day.”
With regard to the space sector’s most innovative companies, said Thompson, “we want to be the customer of choice, the investor of choice.”
In this pandemic “when the economic environment is not good, the potential for adversarial predatory investment in small businesses is higher, and we’re going to have to work through that with the resources and the tools we have available.”
The issue of foreign investment also was raised March 25 by Undersecretary of Defense Lord during a Pentagon news conference. “It’s critically important that we understand that during this crisis the defense industrial base is vulnerable to adversarial capital, so we need to ensure companies can stay in business without losing their technology,” she said.
Kim Herrington, director of defense pricing and contracting, told reporters that DoD is taking steps to ease cash flow to the U.S. industrial base. He said DoD has directed the Defense Finance and Accounting Service to ensure contractors are paid in a timely manner. “We also issued direction to the contracting workforce to be as flexible as possible to allow contractors to also telework when it does not impact the mission,” he said. “This will allow those companies to continue to work and get paid.”
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