Detroit Free Press Tom Walsh column: State gains in defense contracting

Oct 05, 2008 (Detroit Free Press - McClatchy-Tribune Information Services via COMTEX) -- TM | Quote | Chart | News | PowerRating -- "O Michigan, give me your unemployed fabricators and welders, your fastener technology, your engineers, your idled manufacturing capacity ..."

That's Uncle Sam calling.

Just as the Statue of Liberty beckons the tired, the poor, the huddled masses of the world to our shores, now the U.S. Department of Defense is reaching out to Michigan's downtrodden manufacturing base with a plea of "We Want You!"

Largely lost amid the automotive industry carnage, Michigan's 7-year economic slump and Wall Street's meltdown has been a recent upswing in defense contracting and technology research in Michigan.

Examples:

--The volume of defense contracts landed with assistance from DoD Procurement Technical Assistance Centers in Michigan is on track to double this year from $315 million in 2007. Nearly $500 million in such contracts was awarded in the first nine months of this year.

--The Tank Automotive Research, Development and Engineering Center (TARDEC) in Warren has grown to more than 1,200 people, with the addition of 100 from last year's move of the DoD's Robotic Systems Joint Project Office from Alabama. TACOM, the umbrella group for ground combat purchasing, development and logistics, has more than 4,000 people in Warren, including TARDEC staff.

--U.S. military spending just to repair and maintain equipment will be huge -- $100 billion in the next seven years -- no matter how soon the Iraq war ends. "And no location in the world is better positioned to get a big bite of that than Michigan," said retired U.S. Marine Corps Major Gen. Bradley Lott.

Lott, 60, was hired a year ago by Gov. Jennifer Granholm to be the first director of a new entity, Michigan's Defense Contract Coordination Center. His mission: to help Michigan companies snag a bigger share of military and other Homeland Security work.

"We're No. 2 in the country in our research and development assets," Granholm told me Thursday, referring to Michigan's universities, auto industry and other companies, "but we're only No. 28 in defense industry R&D contracting."

Lott promised Granholm that the state would double its total defense contracting from about $1 billion last year to $2 billion by 2010. He told me in mid-September that he thinks Michigan could hit that mark by mid-2009.

Lott, who once headed the Marine Corps' supply chain management, said Michigan's manufacturing history, combined with its current economic woes, make the state a perfect match for DoD's needs.

"There's incredible capacity and skills here, compared to what I've seen in other states. And a lot of excess capacity," he said.

The military will need that capacity in metal fabrication, tooling and motor vehicles for many years. "This war will be over and the emphasis will shift to repairs," Lott said, in order to get military hardware of all kinds battle-ready again.

"What we're reviving in the state is the Arsenal of Democracy," he added, using the nickname given to the Detroit region by former President Franklin Roosevelt for the rapid conversion from autos to weapons production in World War II.

Grace Bochenek, director of TARDEC, said moving military robotics operations to Warren, at a time when DoD is also putting a huge emphasis on alternative energy research into batteries, fuel cells and biofuels, has made more collaboration with private companies and Michigan's universities essential.

Last week, she signed a cooperative research and development agreement with the Michigan Economic Development Corp. to formalize joint R&D efforts, in what Granholm called the state's first such deal with a federal agency.

"This is the auto engineering hub of the world," Bochenek said. "It's why Toyota and Hyundai have R&D centers here, along with the Detroit companies. There's no use in us all trying to figure out lithium-ion batteries separately."

Bochenek has also been pushing Michigan colleges for curriculum changes to support the military R&D effort. The University of Michigan's engineering school added a master's program in robotics this year as a result.

And in July, U-M opened a new Ground Robotics Research Center, with $2 million in projects funded by TARDEC.

The sluggish auto industry has made TARDEC and its cutting-edge research more attractive to graduating engineers and scientists.

"It's times like these when we can pick the best," Bochenek said, noting that TARDEC has been recruiting aggressively because 27% of its workforce will be eligible to retire by 2012.

These's a lot to like about the military's courting of Michigan.

The R&D being done by TARDEC in Warren is mind-blowing stuff, as I discovered during a tour last week. Small shape-changing robots were zipping around in one room, while an unmanned turret in another sat atop huge hydraulic legs like some sci-fi machine from outer space, gyrating to simulate the bouncing of rough terrain.

"We call this room Disneyland," said one of my guides, noting that staffers are working on weapons for use as far away as 2040.

And if you're a defense contractor, the work looks pretty attractive, given the alternatives in today's rocky economy. The military pays its bills promptly within 30 days, Lott said. "And you're not competing with cheap offshore labor," he added.

Interested? Start with a visit to the Procurement Technical Assistance Centers site at www.ptacsofmichigan.org.

Contact TOM WALSH at 313-223-4430 or twalsh@freepress.com.

To see more of the Detroit Free Press, or to subscribe to the newspaper, go to http://www.freep.com Copyright (c) 2008, Detroit Free Press Distributed by McClatchy-Tribune Information Services. For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.

More News:   Market Updates | Stock Alerts | All Trading News | Stock Index