Defense Contractors Face Delayed Impact of Covid-19
The damage to the defense industry caused by the pandemic has yet to be fully measured, and companies may soon be facing more-severe delayed effects, Ellen Lord, the Pentagon’s acquisition chief, said Wednesday.
Lord said the Pentagon plans to collect pandemic data on the tens of thousands of companies that make up the industrial base for the time period of March 15 through Sept. 15 in hopes of better documentation and a lifeline from Congress.
The Defense Department’s rough estimate of the need for assistance to defense contractors is $10 billion to $20 billion. Lord said the department wants the data to pinpoint exactly what companies were hit by the virus and how much is needed.
“There has been mixed reports in terms of revenue and profitability, but I would contend that most of the effects of Covid haven’t yet been seen because most companies gave their employees time off,” Lord said.
“They stretched out production, paid a lot of people for working 100% when perhaps they were only getting 50% of the hours in and so forth.”
Now the industry’s ability to absorb the economic hits from the pandemic is running out.
“We want to make sure that we have a one-time accounting for these major Covid hits very, very well-defined in terms of a period of time,” she said.
Negotiations on the next round of pandemic legislation between congressional Democrats and the administration are stalled. Any stimulus money doled out by Congress will take about six months to distribute, with two to three months of that devoted to collecting the company data.
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Southwest Airlines CEO Gary Kelly: ‘If Things Don’t Improve, This Just Can’t Continue’
Going into the office every day, Southwest Airlines CEO Gary Kelly describes the Dallas headquarters atmosphere as feeling a bit like the mountain hotel from the 1980s horror flick The Shining.
“We’ve got a skeleton staff here,” he said. “Our headquarters can accommodate about 5,000 people roughly and there are maybe 100 people here every day. "
Those halls and cubicles are empty for the same reason many airplanes are. The COVID-19 pandemic has changed every aspect of life for the past six months.
Kelly, who succeeded Southwest founder Herb Kelleher in 2008, spoke with The Dallas Morning News on Thursday about how the airline known for its upbeat attitude and friendly service is handling the toughest financial crisis in aviation history.
Read excerpts from the interview in Aviation Pros