This stuck out like a sore thumb yesterday...
@BAFR 0.80 0.10 0.75 0.85 Volume: 14785 Open Intrest: 4273 90.00
Probably has to do with this:
WASHINGTON (AP) - The Air Force is expected this week to award either
Lockheed Martin Corp. or Boeing Co. a contract worth about $1.8 billion to build
eight next-generation global positioning satellites.
The deal could ultimately be worth more than $4 billion as the victor will
be in a strong position to win two additional contracts for another 24
satellites for the Pentagon's new GPS III system, said Loren Thompson, a defense
industry consultant based in Virginia. Thompson consults for Lockheed, among
other aerospace companies, but not on the GPS III program.
The first GPS III satellites are scheduled for launch in 2014, with all 32
satellites in orbit by 2022. The military relies on GPS systems to provide
precision timing and navigation signals for aircraft, guide bombs and missiles,
direct troops, map battlefields, conduct minesweeps and perform other operations
critical to modern warfare.
Air Force officials declined to comment on the timing of the contract
announcement, although two industry sources said it could come as soon as
Tuesday.
Boeing and Lockheed both already hold satellite contracts for the military's
existing GPS II constellation, but Boeing's part of that program has suffered
technical problems, delays and cost increases. That track record will likely tip
this next-generation contract in Lockheed's favor, Thompson said.
Thompson added that the Air Force actually picked the winner months ago, but
delayed the announcement in part to ensure it can justify its choice and avoid a
messy protest dispute.
The Air Force is still smarting from Boeing's protest of $35 billion order
for 179 aerial refueling tankers awarded to Northrop Grumman Corp. and European
Aeronautic Defence and Space Co. in late February. Boeing has filed a formal
protest of the contract with Governmental Accountability Office, which is
expected to issue a ruling by June 19.
"Boeing's tanker protest has convinced the Air Force that it must have a
very compelling case ready when it makes a contract award," Thompson said.
The GPS III contract will be subject to tight cost controls. In a statement
last week, John Young, undersecretary of defense for acquisition, technology and
logistics, said he has directed the Air Force to tie payments to the contractor
to "specific program accomplishments," not to adjust the scope of the program or
change its technical specifications and to "consider solutions which lower cost
or risk to deliver within or below budget."
The new GPS III network, which will be interoperable with Europe's Galileo
GPS system, has a more powerful military signal, resistant to enemy jamming, and
a stronger commercial signal. Its cross-linked command and control system will
allow simultaneous upgrades of the entire GPS constellation from a single ground
station.
Shares of Bethesda, Md.-based Lockheed Martin rose $1.53 to $108.50 Tuesday.
And shares of Chicago-based Boeing gained 28 cents to $85.08.
Copyright 2008 Associated Press. All rights reserved. This material may not be
published, broadcast, rewritten, or redistributed.
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