June 22, 2020 / 6:50 PM / 11 days ago

Pentagon contracts to help COVID-hit defense firms reaches $472 million

WASHINGTON, June 22 (Reuters) - Pentagon contracts to support U.S. weapons makers and contractors impacted by the coronavirus have reached nearly half a billion dollars, a Pentagon official said on Monday.

As the virus continues to strain the finances of the defense industrial base the Pentagon has signed for an additional $472 million in contracts to help sustain critical workforce capabilities for shipbuilding, body armor, aircraft manufacturing, and medical supplies, the Department of Defense’s chief buyer Ellen Lord told reporters at the Pentagon.

On June 10, the Pentagon gave General Electric $20 million mostly to pay the salaries of 100 highly-skilled engineers at the jet engine maker who work on Pentagon projects.

On that day the department doled out $135 million to five companies, mostly to make sure contractors could continue to pay the highly-skilled engineers, composite fabricators, specialized laser operators and others needed to work on Pentagon projects.

Companies like Spirit Aerosystems, which makes aircraft parts for both the Pentagon and commercial manufacturers, received $80 million but has lost huge amounts of revenue during the economic slowdown following the COVID-19 lockdown.

Low demand for commercial air travel and aircraft, as well as the grounding of the Boeing-made 737 MAX jets, impacted Spirit.

Separately, the Pentagon has submitted a request to the White House Office of Management and Budget for “lower double digit billions” to support defense industry claims under section 3610 of the CARES Act, Lord said. Section 3610 allows the government to pay contractors for sick time or if healthy workers couldn’t get to job sites due to the coronavirus outbreak.

The measure aims to keep the defense industrial workforce intact and ward off layoffs if plants have to close or workers stay at home by reimbursing the sick leave through the end of the government’s fiscal year in September. (Reporting by Mike Stone in Washington; Editing by Aurora Ellis)

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