In 2009, Fire Protection invested in some engineering changes to its Buffalo product line.

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Force Protection Inc. – a manufacturer of ballistic- and blast-protected vehicles to support the armed forces globally – changed its business focus late last year from manufacturing equipment to providing total lifecycle support such as maintenance, upgrades, field service and modernization, as well as installing indepen­dent suspension systems and ForceArmor kits. “Our business is changing due to a num­ber of factors including defense spending outlook,” Senior Director of Cor­porate Communications Tommy Pruitt says. “There is more pressure on the de­fense budget now to use existing equipment.”

The changing business mix began in the fourth quarter of last year, and was accelerated earlier this year. The company decided to make the change then because it wrapped up its Mine Resistant Ambush Protected (MRAP) vehicle contract for the Marine Corps. “It’s not just about vehicle production – we are enhancing the vehicle and improving over the life of the vehicles,” Pruitt notes. “We will continue to develop next-generation solutions that can handle multiple threats.”

For example, the company is upgrading suspensions on its Cougar vehicle – a family of medium-sized MRAPs – so that the vehicles originally intended for the Marine Corps to use in Iraq can now be utilized in Afghanistan. “We in­creased mobility levels of the vehicle for the terrain in Afghanistan while maintaining survivability levels,” he explains.

This new focus required the company to analyze and reduce its overhead and other operational costs. Earlier this year, it announced that it is implementing several changes geared to save the company at least $40 million. “This initiative is designed to align the company’s cost structure to current and planned vehicle production and to improve operational efficiencies in the area of total life cycle support,” the company says.

To reduce costs, the company will decrease its work force by 10 percent, and lower costs for general corporate functions such as finance, consulting, legal and human resources, facilities man­age­ment, travel and insurance. It is also stream­lining spares logistic functions to better serve its customers, reduce lead times and leverage existing re­sources, it says.

On Track
In early November, Force Protection re­ported net sales of $316.2 million for its third quarter, significantly lower than its $343.3 million net sales in the third quarter of 2008, but higher than its second quarter 2009 revenues of $187 million. However, the company notes that the 2008 figure included pass-through sales by General Dynamics Land Sys­tems in connection with vehicle deliveries un­der its MRAP competitive contract.

“Excluding pass-through vehicle sales, the third quarter of 2009 marked a re­cord quarterly revenue performance for the company,” it says. “This performance was driv­en by record shipments of Buf­falo veh­icles in the quarter, shipments of Wolf­hound vehicles and stren­gth in the com­pany’s total lifecycle support business.”

Pruitt says the company expected the third quarter sales to be significantly higher than the second quarter. “Early in 2009, we spent the time we felt was required to implement engineering chan­ges to our Buffalo product and are now de­livering on our commitments to the de­­livery schedule in the second half of 2009,” he explains. A total of 110 vehicles were shipped in the third quarter – 51 Buffalo vehicles and 59 Cougars, mainly Wolfhound vehicles. In the third quarter of 2008, 444 vehicles were shipped total. “The vehicle sales are down substantially as far as num­bers go,” he notes. “Revenues continue to be strong in spite of the lower veh­icle deliveries, as the third quarter re­sults show.”

New Markets
Although Force Protection is focusing more on providing solutions and survivability features, vehicle manufacturing is still an important aspect of the company, Pruitt says. Force Protection Europe, based in the United Kingdom, recently submitted its Ocelot vehicle for the Light Protected Patrol Vehicle competition.

The Ocelot – developed in partnership with Ricardo UK Ltd. – has survivability features and a range of mission capabilities at a curb weight of 12,000 pounds. The company expects results of the competition will be announced in early to mid-2010.

The company is also looking for other opportunities for its Cheetah vehicle. It was originally built for the U.S. Army’s Tank-Automotive and Armaments Command’s M-ATV competition, but that contract was awarded to another de­fense contractor. “Beyond military customers, those potential customers could in­clude homeland, private security and non-governmental organizations,” Pruitt says. “We are aggressively exploring those markets.”

Overseas Opportunities
Force Protection says it sees a strong fu­ture even with the current economic climate. “We believe there are still some via­ble long-term opportunities with the U.S. cus­tomer, but we do believe in the near term there are more opportunities in international markets for vehicle sales,” Pruitt says. For example, there are new and ongoing opportunities in the United Kingdom, as well as Iraq – whose army purchased 600 Cougars.

“We’ll continue to work with the customer to upgrade and enhance the Cougars and Buffalos they already have in addition to exploring opportunities for new vehicle sales,” he adds.