FRPT

[TerryG]

Here is some sanity about todays selling.

http://www.youtube.com/watch?v=Uy2BCwJd4lE&mode=user&search=

[la-onda]

fyi
Armored vehicle contracts draw fire
Ladson company Force Protection among producers criticized in report
By RICHARD LARDNER and ANNE FLAHERTY
Associated Press
Thursday, July 12, 2007
The Cougar armored vehicle is constructed by Force Protection at its Ladson facility.

WASHINGTON — The Defense Department put American soldiers in Iraq at risk by awarding contracts for badly needed armored vehicles to companies that failed to deliver them on schedule, according to a review by the Pentagon's inspector general.
The June 27 report, obtained Wednesday by the Associated Press, examined 15 contracts worth $2.2 billion dollars awarded since 2000 to Ladson, S.C.-based Force Protection and Armor Holdings.
The auditors found several contracts issued by The Marine Corps on a sole-source basis to Force Protection, even though Corps officials knew there were other manufacturers that might have supplied the vehicles in a more timely fashion. The Marine Corps determined that Force Protection was the only supplier that could meet the urgent delivery schedule for the vehicles.

The inspector general's report, however, concludes otherwise. It says the company "did not perform as a responsible contractor and repeatedly failed to meet contractual delivery schedules for getting the vehicles the theater."

Force Protection issued a statement late Wednesday that said it was "disappointed" with the report. "We have consistently operated under urgent operational needs and have sought diligently to meet government requirements under extremely short timeframes," the company said. "When delays in deliveries have occurred, it has been representative not of a problem with the vehicle nor the system, but that even a minor glitch in the supply chain can push things back under such tight parameters."

Company spokesman Tommy Pruitt pointed out that the report examined contracts under a program that ended about two years ago, the Joint Explosive Ordnance Disposal Rapid Response Vehicle, which began when the company was just starting to expand its staff and facilities to increase production.

Pruitt acknowledged that Force Protection did fall behind schedule last month, but the company worked through the July 4 holiday and is now caught up.
Workers build a Cougar armored vehicle at the Force Protection plant in Ladson.

Under the current Mine Resistant Ambush Protected vehicle program administered by the Marine Corps, the company has won orders for about 1,600 vehicles. "If we were continuing to do a bad job on deliveries, we would not expect to continue getting contracts," Pruitt said.
The inspector general's report also criticizes the Army's decision to award a contract for armor kits to Simula Aerospace and Defense Group, a subsidiary of Armor Holdings of Jacksonville, Fla.
Simula did not meet the government's definition of a "responsible prospective contractor," according to the report, and it lacked the mechanisms necessary to ensure proper delivery of the kits, which were needed to make Humvees less vulnerable to roadside bombs. The Army received kits "with missing and unusable components, which increased the kit installation time and required additional reinspection of kits," it said.

Overall, the problems "resulted in increased risk to the lives of soldiers," the report states. In written comments to the inspector general, the Marine Corps defended its acquisition decisions for the vehicles. The armored vehicle contracts "were executed within the law, spirit and intent of the current acquisition rules and regulations," according the comments.

The Army did not object to the report's findings.The review was requested by Rep. Louise Slaughter in 2006, after she learned the Pentagon was relying on a just a few small companies to supply armored vehicles to troops. With improvised explosive devices accounting for the majority of combat deaths and injuries, Slaughter said strategy needed to be examined.

"It's been business as usual," Slaughter, D-N.Y., said Wednesday after reviewing the report. "The lives of our soldiers took a back seat to who got the contracts."

Slaughter said the report raises "more questions than answers" and she wants to know if the awards were the result of "influence peddling or insider connections."

[TerryG]

Someone is confident or optomistic. They were saying yesterday that it had to do with interest from other countries. This is the third production location with the second delivering vehicles in Q4.

Force Protection Acquires New Vehicle Production Facility

BusinessWire
4:15 PM ET

Force Protection, Inc. (NASDAQ:FRPT) today announced it has purchased a new 430,000 square foot facility in Roxboro, NC. Force Protection plans to use the Person County facility for additional capacity for current and future products including its new Cheetah vehicle line. The company's ownership is effective today.

Force Protection is a leader in producing the world's most advanced mine protected vehicles that have become the gold standard for troop safety against the threat of improvised explosive devices (IEDs), land mines, and roadside bombs.

"This is an exciting devel opment for Force Protection," said COO Raymond Pollard. "This will be a strategically important facility for the company, as it will enable us to continue to ramp up MRAP vehicle deliveries on the Cougar and Buffalo lines while simultaneously producing the next generation Cheetah vehicle series. At this new facility, we will initially have the capacity to produce approximately 2,000 vehicles in 2008."

"Force Protection is excited about establishing this significant new manufacturing capability in North Carolina," said Executive Vice President Dan Busher. "North Carolina and Person County understand the urgency of delivering more of our life saving products to our armed forces and have worked with us to identify the right set of facilities and resources to accomplish that missi on. The broad based community involvement in understanding our needs and proposing solutions has really been outstanding."

Force Protection's Cheetah vehicle was recently featured in a Fox News Channel special report, and will join the Cougar and Buffalo vehicles that have an unmatched record for troop safety in Iraq and Afghanistan since 2003.

Force Protection is a leading ballistics research and manufacturing enterprise, specializing in the development and production of highly reinforced armored personnel carriers that are designed to save soldiers' lives by shielding them from the deadly effects of roadside bombs, or IEDs, which have become a leading killer of U.S. troops in Iraq. The trucks' unique, V-shaped hull is designed to deflect the force of IED blasts away from the vehicle, keeping soldiers inside safe and alive, and have become the proven response to an emerging global threat to U.S. troops. Its leading models include the 23 ton "Buffalo", a uniquely-designed mine clearance vehicle with a reinforced mechanical arm, and the family of "Cougar" vehicles, both of whose mine and ballistic protection capabilities are among the most advanced in the world. The vehicles are manufactured outside Charleston, SC. Visit the company's website at www.forceprotection.net.

This release contains forward-looking statements, including, without limitation, statements con cerning our business, future plans and objectives and the performance of our products. These forward-looking statements involve certain risks and uncertainties ultimately may not prove to be accurate. Actual results and future events could differ materially from those anticipated in such statements. The company cautions that these forward looking statements are further qualified by factors including, but not limited to, those set forth in the company's Form 10-K filing and other filings with the United States Securities and Exchange Commission (available at http://www.sec.gov) and the company's public statements. The company undertakes no obligation to publicly update or revise any statements in this release, whether as a result of new information, future events or otherwise, except as required by law.

SOURCE: Force Protection, Inc.

Force Protection, Inc. Media Contact: Policy Impact Communications Jeff Child, 202-737-5339

[la-onda]

it is all said now:

Force Protection, Inc. Offers Comment on Report by Pentagon's Inspector General
Friday July 13, 8:30 am ET

LADSON, S.C.--(BUSINESS WIRE)--Force Protection, Inc. (NASDAQ:FRPT - News) today offered comment on a June 27 report issued by the Pentagon's Inspector General that criticized the U.S. Marine Corps for awarding sole source armored vehicle contracts to the company in 2005, despite delays in delivering the vehicles on schedule.
"Like all Americans, we are disappointed with some of the findings in the Inspector General's report," said Force Protection CEO Gordon McGilton. "From its beginnings, Force Protection's objective has been to provide the finest lifesaving vehicles in the world. We have consistently operated under urgent operational needs and have sought diligently to meet government requirements under extremely short timeframes. However, we believe that recent press coverage on the report has missed some key findings. As stated clearly on page 26, 'the Cougars and the JERRVs proved to have significant and operational value to our warfighters on the field.' The report also states that, 'We reviewed documentation from users and classified data on vehicle performance and learned that the vehicles performed well and saved lives.'
"When past delivery delays have occurred it has been representative that even a minor glitch in the supply chain can push things back under such tight parameters," McGilton said. "Enormous progress has been made in fielding this proven, battlefield solution years ahead of traditional defense schedules. Tens of thousands of our servicemen and women are alive and have reunited with their families and friends at home because of the protection provided by our vehicles. Force Protection will continue to work with the Department of Defense to produce and improve upon the best blast and ballistic protection technology in the world."
Force Protection's vehicles have become the gold standard in troop protection against IEDs, roadside bombs, and land mines. The vehicles have logged more than three million hours of heavy combat operations and withstood thousands of blast attacks in Iraq and Afghanistan since 2003.

&

Force Protection May Rise to Record on Cougar, Buffalo Sales
By Edmond Lococo
July 13 (Bloomberg) -- Force Protection Inc. has the largest share of orders for the Pentagon's top procurement priority for the war in Iraq: blast-resistant trucks. Analysts estimate the company's 2008 sales will double.
The stock is rated ``buy'' by all four analysts who follow it, according to Bloomberg data. None of that has shielded the Ladson, South Carolina-based company's shares from a 25 percent drop in the past six weeks.
The decline was sparked by concerns the company may struggle with deliveries and lose market share to larger rivals such as Navistar International Corp. Stock sales by senior executives exacerbated the fall. Still, three of the four analysts who follow the company say the shares will climb to a record as Force Protection wins its portion of a planned U.S. Marine Corps order of 20,000 trucks valued at about $20 billion.
``Force Protection does have some of the best vehicles and they are going to be rewarded with orders,'' said Joseph Maxa, an analyst at Dougherty & Co. in Minneapolis. ``When they get the orders, that is going to drive the stock.''
Maxa projects Force Protection shares will rise 40 percent to $32 in the next 12 months. He doesn't own any. Sales will double to $1.4 billion in 2008 from $697 million this year, according to four analysts surveyed by Bloomberg.
The trucks protect U.S. troops from homemade bombs, which are the leading cause of combat deaths in Iraq. The Marines say Mine-Resistant, Ambush-Protected vehicles, or MRAPs, with V- shaped hulls like Force Protection's Cougar and Buffalo trucks, are four times safer than flat-bottomed transports.

Second Contest

Force Protection is among six companies that won orders valued at $1.7 billion since January. Force Protection's $770 million is about 44 percent of the total. The second competition will be decided in January.
Three of the four analysts following Force Protection project the stock to rise above the company's record close of $30.27 on May 30 in the next 12 months. The shares closed at $22.79 yesterday, and have risen 31 percent so far this year.
James McIlree, an analyst at C.E. Unterberg Towbin in New York, projects the shares will rise to $32, while Chris Donaghey, an analyst at SunTrust Robinson Humphrey in Atlanta, predicts they'll hit $36. Neither owns the stock. Both SunTrust and C.E. Unterberg have done investment banking work for Force.
The fourth analyst, David Gremmels at Thomas Weisel Partners in New York, doesn't forecast a price or own any shares. Thomas Weisel buys and sells the shares for customers.

Mouths Shut

The company doesn't provide financial forecasts. Chief Executive Officer Gordon McGilton, 63, declined to answer most questions shareholders asked about competitive position and vehicle output during Force Protection's annual meeting on June 21.
``A refusal to interact doesn't mean we're hiding something,'' McGilton said in an interview after the meeting in Charleston, South Carolina. ``We have a history of keeping our mouths shut until there is something beneficial to say.''
Force Protection shares may rise because investors have overestimated the threat from rivals, and incorrectly assumed demand for the trucks will disappear if the U.S. exits Iraq, said Donaghey.

Troop Reduction

``The downside could be a lower-than-expected win rate, which doesn't seem likely, or that a troop reduction in Iraq would reduce the urgent need,'' Donaghey said. ``A troop withdrawal doesn't take this need away. This is the type of threat we are going to see in future.''
Force Protection was the first company to deliver the trucks in 2003.
The Marines started a competition in January to lift production. Since then, Navistar in Warrenville, Illinois, won a $623 million order on May 31. London-based BAE Systems Plc won a $212 million award on June 28.
To boost output, Force Protection last November teamed with Falls Church Virginia-based General Dynamics Corp., the largest producer of armored vehicles for the U.S. military.
Their joint venture, Force Dynamics, now splits Cougar production, and Force also signed up Jacksonville, Florida-based Armor Holdings Inc., the largest maker of armor for Humvees.

Missed Deliveries

The partnerships have initially strained Force Protection's supply chain, causing missed deliveries, said Michael Aldrich, vice president of government relations. Force deliveries were late by ``a few days'' in May and June as it shipped materials to new production lines, he said. The late vehicles were shipped this month.
Compounding fears about late deliveries and eroding market share were stock sales by Force Protection executives including former Chairman Frank Kavanaugh and CEO McGilton.
Between April 24 and May 31, Kavanaugh sold a total of 1.07 million shares at prices ranging between $23.13 and $30.78. On June 15, he announced he'd leave the company. In January, McGilton had also sold 1 million shares.
Force will continue to ``exceed expectations,'' Kavanaugh, 47, said in an interview one week after stepping down on June 21. His share sales were part of a prearranged plan for company executives, which can't be altered once put into place, he said.

Off the Table

That plan, which ends in August, had about 329,000 shares remaining as of June. Kavanaugh continues to hold another 840,000 shares, which he says he has no current plans to sell.
``I'm an investor, and I took some money off the table,'' Kavanaugh said. ``I still have a substantial amount of my net worth in this company.''
His holdings at the end of May made him the company's 12th largest shareholder, according to Bloomberg data.
Kavanaugh said his departure is actually a sign of the company's good health, because his specialty is corporate turn- arounds, rather than defense programs. As managing director of Fort Ashford Funds LLC in Irvine, California, he helped raise $250 million for the company's expansion from 2003 through 2006.
Kavanaugh became chairman in 2005 when he said Force Protection ``was in a mess.'' He presided over the revamping of the company's manufacturing processes. Before leaving, he oversaw the listing of the company's shares on the Nasdaq market in January. They previously traded over the counter.

Buying Opportunity

The company's shareholder base is now shifting from retail investors to institutions including FMR Corp.'s Fidelity Investments and Wellington Management Co. Both declined to comment on their holdings in Force Protection.
For some retail investors who have held the shares since they traded over the counter, the recent dip was nothing but a buying opportunity.
Kenneth Williams, 65, has put almost all his personal investments in Force Protection since he saw plywood prototypes of its trucks on a factory tour in 2004. The retired former Air Force technician from Columbus, Ohio, bought most of his holdings around $1 a share. He added to his stake, now more than 100,000 shares, when they fell under $22 last month, because he says they will rise to as much as $60 over the next few years.
``I'm surprised it headed lower,'' Williams said. ``If I could dig up more money, I would buy even more, but I'm pretty well committed.''

http://www.bloomberg.com/apps/news?pid=conewsstory&refer=conews&tkr=FRPT:US&sid=asL_nZnSXrnc

[la-onda]

nice story

'We were in a Cougar, so we survived'http://www.usatoday.com/news/military/2007-07-15-colomer-usat_N.htm

[la-onda]

overreaction imho 

Rival's Gain, Force Protection's Loss
Evelyn M. Rusli , 07.16.07, 4:20 PM ET

Force Protection

Military procurement seems like a zero-sum game. When Armor Holdings won a $518.5 million contract to produce armored vehicles for the Navy on Monday, its competitor Force Protection paid for it in the stock market.

Force Protection (nasdaq: FRPT - news - people ) shares tumbled 11.8%, or $2.71, to $20.18, in afternoon trading as investors worried that the companywas losing its dominance in the armored vehicle market. Meanwhile the stock price of Armor, which has held steady ever since BAE Systems (other-otc: BAESF - news - people ) announced a takeover earlier this year, barely budged. Armor edged down 0.03%, or 3 cents, to $87.35.

Since it peaked in May at $28.40, Force Protection's stock has drifted lower amid increased competition. Other armored vehicle makers, such as Armor Holdings (nyse: AH - news - people ), its soon-to-be parent BAE Systems (other-otc: BAESF - news - people ), and Navistar (other-otc: NAVZ - news - people ), have sweeped up large-sized contracts in the last few months. (See: "Competitive Concerns Sap Force Force Protection." )

Under the government's Mine Resistant Ambush Protected vehicle program the Army is expected to award contracts to produce 23,000 armored vehicles, about 7,700 of which will be awarded this year. When all is said and done, Force Protection is expected to have a 40% share of the pie. In terms of field performance, Force Protection boasts the best record -- to date, no one has died in its mid-sized vehicles. However, the young Ladson, South Caroline-based company has struggled to meet the military's tight deadlines in the past.

"It's not a step forward for Force Protection, but it's not a step back," C.E. Unterberg, Towbin analyst James McIlree, told Forbes.com on Monday. McIlree still believes Force Protection will be able to hold on to its 40% stake.

Some analysts were not surprised by Armor's victory on Monday. According to Timothy Quillin of Stephens, Armor had "the most reliable medium-sized tactical vehicle." Under the deal, Armor will make 1,054 Category I vehicles and 16 Category II vehicles. Category I vehicles are light-weight vehicles designed for urban terrain. Relatively, Category II vehicles are larger and are used for rapid-response activities, such as troop transpors,

With its Cougar vehicle, Force Protection easily monopolizes Category II. However, it has struggled in Category I, which should comprise the bulk of the army's orders. The company has a strong contender for Category I coming up later this year. At 7 tons, the Cheetah will be lighter and more mobile than the Cougar line, making it an attractive Category I vehicle or a replacement candidate for the Humvee.

[TerryG]

True. Selling for no reason can still happen. The stock is oversold but the full Stochastic still says there is downside to this.

The only good news that could come before the 2008 budget is any remaining 2007 funds being applied to carryover into 2008. Meaning using remaining 2007 funds to buy vehicles in Fiscal 2008 now. That was the bright spot in the AH contract friday, that the contract included carryover into February 2008.

Meaning one more contract coming?

[TerryG]

About another contract if carryover is applied. According to my tally there are about 2200 vehicles left to be contracted with budgeted funds in 2007.

[TerryG]

If this dip has hit bottom?

http://www.jimcramerblog.com/2007/07/hot-stocks-to-watch-today_17.html

Force Protection (NasdaqCM:FRPT - News). FRPT's PowerRating is 7.
5+ Consecutive Down Days: These are stocks that have closed down for five or more consecutive days and are trading above their 200-day moving average. Our research shows that stocks trading above their 200-day moving average that close down for five or more days have shown positive returns, on average, 1-day, 2-days and 1-week later. Historically, these stocks have provided traders with a significant edge. Historically, these stocks have provided traders with a significant edge.

[la-onda]

thanx AMSTOCKS82:
Force Protection and the MRAP Program

The Mine Resistant Ambush Protected (MRAP) program is designed to bring a type of life saving armored vehicle to the soldiers in Iraq and Afghanistan that can survive in an environment where mines, IEDs and ambushes are common. The most common type of MRAP vehicle has a "V" shaped hull designed to deflect the force of a mine blast away from the undercarriage of the vehicle.

The original MRAP vehicles purchased by the government consisted mainly of vehicles designed in South Africa and manufactured by subsidiaries of BAE or General Dynamics Land Systems. The main vehicles purchased were RG-31s. The RG-31 was much safer than a Humvee but it was produced in low volume and cost in excess of one million per unit.

In 2000, the US Military began looking for domestic suppliers of MRAP type vehicles. From 2000 to 2002, the US military purchased 12 Buffalos for testing and evaluation. The Buffalo is a vehicle manufactured by Force Protection Inc designed for route clearance. The British military was also investigating MRAP type vehicles and purchased 8 Tempest vehicles (an early model of the Cougar).

Both the Buffalo and Cougar performed exceptionally well – much better than competing vehicles. However, the British put on hold plans to buy more MRAP vehicles until 2006. In 2006, the British purchased a Cougar vehicle called the Mastiff after once again evaluating existing MRAP vehicles. In 2004, the US Military began purchasing small numbers of Cougar vehicles from Force Protection Inc (FPI) and in 2005 purchased additional Buffalo vehicles. The military was at this time purchasing other MRAP vehicles especially the RG-31 from other countries as well.

In the field, between 2002 and 2005, the Buffalo and Cougar continued to perform and survived hundreds of mine and IED blasts without any fatalities. During this time, other MRAP vehicles such as the RG-31 and other types of armored vehicles such as the Stryker, M1 Tank and Bradley were not as safe and soldiers continued to be killed riding in them.

In 2005, the military started ordering more MRAPs than they had in the past with the preference going to FPI for Buffalo and Cougar vehicles due to their safety record in Iraq and Afghanistan – and because field commanders in Iraq increasingly specifically requested Cougar and Buffalo vehicles.

The increase in orders allowed FPI to begin growing in size but at the same time strained the company's ability to purchase parts for the vehicles and assemble them on time. Prior to 2005, this type of MRAP vehicle had not been manufactured in large numbers and there were few suppliers of such things as the armored glass or the specific type of armored steel used by FPI. The shortage of parts caused slow delivery of vehicles straining Force Protection's relationship with the military and causing them to miss delivery deadlines.

To prevent future delivery problems, Force Protection began the process of modernizing their manufacturing procedures, increasing the inventory of spare parts, and developing multiple vendors for parts that could not be readily purchased. The modernization had a large impact on Force Protection's management as well. Garth Barrett Force Protection's chief technical officer had opposed the modernization of the manufacturing facility and increases in parts inventory that had contributed to FPI's production problems. Mr. Barrett subsequently left Force Protection and founded a competing company called Protected Vehicles Inc. (PVI).

FPI as an early innovator for MRAP vehicles was able to secure exclusive licenses to the best of the South African technology for manufacture outside of South Africa. In addition, FPI hired the worlds leading expert in mine and IED protection Dr. Vernon Joynt to help design the vehicles and develop new blast manipulation technology. This allowed Force Protection to get an early lead in MRAP technology.

In mid-2006 the military officially announced the MRAP program. They were soliciting bids for 4100 MRAP type vehicles. At this point, multiple vendors began developing MRAP vehicles.

FPI had ramped up production of vehicles to over 40 per month by mid-2006 but due to previous late vehicle deliveries, began adding additional manufacturing partners. This would not only increase the number of vehicles that they could manufacture but also provide the department of Defense with additional assurances that Force Protection could manufacture the vehicles on time. In December 2006, FPI entered into a joint venture to build Cougars with General Dynamics. The joint venture is called Force Dynamics (FD). FD will manufacture Cat I and Cat II Cougars for the MRAP program.

FPI has developed a third vehicle type called the Cheetah. The Cheetah is smaller and lighter than the Cougar or Buffalo but still has a large degree of mine and Improvised Explosive Devices (IED) protection built into it. The Cheetah is designed to be a light tactical vehicle that can be used in the place of Humvees where mines and IEDs are a danger. Given its performance and safety, the Cheetah is the most likely interim replacement for the Humvee. Force Protection is currently in the process of building manufacturing lines to produce Cheetahs and expects to start production this fall.

Force Protection's many manufacturing agreements may have caused them some problems. Shortly after working with BAE on providing a Cougar variant for the Iraqi Army, BAE developed a vehicle remarkably similar to the Cougar called the RG33. BAE and FPI build a Cougar vehicle for the Iraqi Army. FPI provided the vehicle design but kept all rights to the technology and spare parts business. FPI entered into a manufacturing agreement in November 2006 with Armored Holdings where Armored Holdings subcontracted to build Cougars. Recently, Armored Holdings won a manufacturing award with a vehicle that from the outside appears very similar to the Cougar.

Much of the technology in the Cougar is not protected by patents. Instead, it's only protection was trade secrets or the licensed technology from South Africa. Due to the manufacturing agreements that FPI entered into, the competitors were able to learn the trade secrets but were not able to use the licensed technology from South Africa. Although BAE was able to build a vehicle that appeared similar to the Cougar called the RG-33, without the South African Technology that was exclusively licensed to FPI, BAE had difficulty in getting their vehicle to pass testing. But in the end after several design changes and adding additional armor, the vehicle was able to pass blast testing. The same is true for the Armored Holdings vehicle.

Perhaps because of FPI's past relationships with BAE and Armored Holdings, FPI is keeping their newest technologies and trade secrets to themselves. They are not licensing other manufacturers to build the Cheetah and are keeping other technologies such as their lightweight add-on armor product secret. FPI's add-on armor was recently tested by the military and is designed to stop Explosively Formed Projectiles (EFP)s and Multi-slug IEDs. Other add-on armor solutions from manufactures such as Plasan Sasa, Ceradyne and Armor Holdings are designed to stop only EFPs. Therefore, FPI believes that they have a superior add-on armor product.

To date, approximately 4750 MRAP vehicles have been ordered:
1) The joint Venture FD received orders for 1798 MRAP vehicles

2) Navistar has received orders for 1202 vehicles

2) BAE received orders for 365 vehicles

3) AH received orders for 1156 vehicles

4) Oshkosh received a pre-testing order of 100 vehicles but has not received subsequent orders – they were expected to get the third large order instead of Armored Holdings but due to manufacturing issues, have not received a subsequent order. It is not known if they will receive one in the future.

5) PVI has received a pre-testing order for 62 vehicles but has not received subsequent orders. After testing, PVI must make changes to strengthen the vehicle prior to delivering the 60 vehicles

6) GD received a pre-testing order for 24 vehicles but has not received subsequent orders. GD must strengthen the vehicles before delivering the entire order to the military.

Based on comments from people familiar with MRAP testing, FPI's vehicle performed overall best, followed by Navistar, BAE, Oshkosh, AH, PVI and GD.

Force Protection began ramping-up their production lines in 2006 and had reached approximately 100 vehicles per month by early 2007. The Joint Venture FD and production partners have provided plans to the military to build up to 1000 MRAP vehicles per month early in 2008.

However, for FD to continue ramping-up, they must get new production contracts by my calculation no later than early August to begin pre-ordering parts to build the vehicles. If they don't get the orders, then their ramp-up will likely be less aggressive.

The militaries strategy is to get many manufacturers making MRAP vehicles in order to rapidly acquire thousands of MRAP vehicles. However, in the current MRAP budget, the Defense Department has spent most of the money available. Therefore, Defense Secretary Gates is speaking to Congress to get additional funds moved from other defense programs re-targeted to MRAP. If this effort succeeds, it is not certain where that money will be targeted but FD is expected to get a portion of that money in additional vehicle orders. Fiscal year 2008 begins November 1 and the budget for MRAP is expected to be $4.1 billion dollars. Force Dynamics is expected to get large contracts from that budget.

Short term, FPI should maintain the technology lead with their Cougar and Buffalo products. Longer term, other companies are expected to continue to reverse engineer existing armor technologies and develop new. However, by the time other competitors are able to build comparable products, the second MRAP competition is expected to be decided. The second MRAP competition is for vehicles that have an even greater level of protection against IEDs, mines and can protect against newer IEDs and EFPs. FPI is well situated for this as they have already developed their solution. Their newer vehicle the Cheetah already has available EFP protection as do their Cougar and Buffalo products.

However, due to the demand for vehicles, the quality edge may not be enough to get the majority of orders. Any MRAP vehicle that can pass the militaries testing is superior to a Humvee and will save lives in Iraq. Therefore, not only is quality important but so is production capacity. FD has the most aggressive ramp-up plan so far announced by any of the competitors but even with orders for over 1700 MRAP vehicles, this is not enough backlog to support the massive ramp-up to 1000 vehicles per month that FD announced they were capable of.

FPI's longer term objective is to sell their Cheetah product and add-on armor products. No other competitor has access to FPI's technology used in designing the Cheetah. The Cheetah is capable of becoming the combat replacement to the Humvee. This would mean thousands of orders each year for many years to come.

Whatever happens, one thing is sure, the ramp-up and backlog that FPI currently has will rapidly increase their revenue from 2006. Force Protection's 2007 revenue and profit could be over 400% higher than 2006.

[TerryG]

This explains how Armor Holdings jumped ahead of OSH/PVI to make it a four way split. Their partner is Lockheed Martin. Contender in JLTV.

Lockheed May Bid in Blast-Resistant Truck Contest (Update1)

By Edmond Lococo

July 17 (Bloomberg) -- Lockheed Martin Corp. may make a bid in the U.S. Marine Corps's second contest for blast-resistant trucks, which might award contracts totaling $20 billion.

Lockheed didn't bid in the first contest for the Mine- Resistant, Ambush-Protected vehicles, or MRAPs. Its involvement is now limited to supporting Armor Holdings Inc., which won a $518.5 million contract last week, said Lockheed's Kathryn Hasse, head of truck programs.

Armor Holdings is one of seven companies that won orders for blast-resistant trucks valued at more than $2.2 billion since January. The Marine Corps on July 2 announced a second competition for as many as 20,000 vehicles to be decided in January 2008. Lockheed will assess the request for proposals when it is issued this month, Hasse said.

``We're evaluating what we want to do with respect to that opportunity,'' Hasse, director of tactical wheeled vehicles, said today in a phone interview.

Lockheed, the world's largest defense company, is still defining the terms of its partnership with Armor Holdings for the first phase of the MRAP competition, Hasse said. Lockheed will likely provide ``systems integration'' and ``logistics support'' for Armor's truck, called the Caiman. Lockheed declined to be more specific about the work.

Jump Start

The partnership, announced in March, was ``jump-started'' by Armor's 1,170 vehicle contract last week, Hasse said. The order was Armor's first since a contract to deliver prototypes in January.

``We now have a basis to come to agreement on a definitive work scope,'' Hasse said. ``Without their having an MRAP vehicle award, there was nothing much we could do.''

The MRAP vehicles have a blast-deflecting V-shaped hull which the Marine Corps has said is four times safer than flat- bottomed trucks. U.S. Defense Secretary Robert Gates said in May purchasing the trucks is the top priority to protect forces in Iraq from homemade bombs, which are the leading cause of U.S. combat deaths.

The largest maker of blast-resistant trucks for the U.S. military is Ladson, South Carolina-based Force Protection Inc.

Shares of Lockheed rose $1.81 to $98.61 at 4:02 p.m. in New York Stock Exchange composite trading. They have risen 7.1 percent so far this year.

To contact the reporter on this story: Edmond Lococo in Boston at [email protected]

Last Updated: July 17, 2007 16:18 EDT

[TerryG]

My tally was 2,200 vehicles but the official tally for the remaining Fiscal 2007 year is 1,480 vehicles to be contracted for. Meaning more contracts before fall.

http://defense.iwpnewsstand.com/defensenewsstand_spclsubj.asp?s=ied

Pentagon Plans Orders for 1,480 Additional MRAP Vehicles This Summer

DefenseAlert - 7/18/2007

July 18, 2007 -- The Defense Department's $1.1 billion reprogramming proposal for the Mine Resistant Ambush Protected vehicle program would provide funds for an additional 1,480 vehicles during fiscal year 2007, bringing the total number of vehicles on order to 6,415, according to senior Pentagon officials.

[TerryG]

Another estimate of whats in the pipeline.

The funds would add 2,650 vehicles to an existing Defense Department order for 3,765 MRAPs

http://www.leatherneck.com/forums/showthread.php?p=263160#post263160

Corps redirects $563M to speed MRAP delivery
By Kimberly Johnson - Staff writer
Posted : Wednesday Jul 18, 2007 18:59:45 EDT

The Corps is pulling $563 million from low-priority programs and funneling it into blast-proof vehicles in a bid to push the vehicles out to troops faster.

The move is part of a Pentagon-wide plan to inject about $1.2 billion into production of Mine Resistant Ambush Protected vehicles, which would almost double existing orders. The funds would add 2,650 vehicles to an existing Defense Department order for 3,765 MRAPs, Pentagon spokesman Geoff Morrell said Wednesday.

[TerryG]

Technical Analysis

Short the Established Downtrend in Force Protection

By Dan Fitzpatrick
RealMoney.com Contributor
7/19/2007 8:56 AM EDT

URL: http://www.thestreet.com/newsanalysis/technicalanalysis/10368515.html

Force Protection (FRPT) is a dominant player in the armored vehicle industry. In light of the plethora of hot spots in the world, this is a good business to be in today.

The company has had the lion's share of the armored vehicle market, but that appears to be changing. TheStreet.com's Melissa Davis has written some great articles on Force Protection's troubles, though I have heard from one or two bulls who feel the company is getting unjustly smeared.

Now, there are always two sides to every argument, and after listening to the bulls and the bears, I'm going to use my usual tiebreaker -- the stock chart.

If you look at the daily chart of Force Protection, you'll see that the stock price has been cut by one-third since late May, steadily declining in a stair-step fashion. But the stock is now testing a critical level.

With its share price now down at $20, an obvious level of support, Force Protection could be at a bottom. The bulls could be making a stand right here, right now.

But if $20 fails to hold off the selling pressure, I believe the stock could fall another $3 before the next level of support comes into play.

If Force Protection falls below $20 down to $19.90 you might consider shorting this established downtrend. But because of the nature of this short idea, the stop needs to be fairly tight, just above yesterday's high of $21.19 -- let's say $21.25.

Assuming support is broken, you'll want to keep a tight leash on the position, and any strength that's sufficient to push the stock above yesterday's high is also a signal that the bulls are making a stand at $20. You don't want to be short.

The downside target on this short is $17, right in the middle of the March consolidation level. Shares of Force Protection closed at $20.56 Wednesday.

[la-onda]

thestreet.com is posting bullshit imho 

moer important is this:

Force Protection seen as MRAP beneficiary
Analyst cites head start in production of fortified military vehicles
By Christopher Hinton, MarketWatch
Last Update: 9:34 AM ET Jul 19, 2007

NEW YORK (MarketWatch) -- Force Protection Inc. stands to benefit from a Defense Department plan to allocate another $1.2 billion for purchases of military vehicles specially designed to withstand powerful explosions, a Thomas Weisel analyst said Thursday.
These so-called MRAP vehicles -- short for military resistant ambush protected -- are in great demand because they would afford greater protection for U.S. forces exposed to deadly improvised explosive devices, or IEDs, during patrols in Iraq and Afghanistan.

FRPT20.81, +0.25, +1.2% ) , based in Ladson, S.C., is "well positioned" to meet the Defense Department's requirements and is believed to be three to six months ahead of the competition in ramping up MRAP production, Thomas Weisel's David Gremmels said in a research note.
Chart of FRPT
Force Protection's shares traded 2% to $20.99 in premarket trading.
On Wednesday, the Defense Department said it wants to transfer $1.2 billion in existing funds to order an additional 2,650 MRAP vehicles, bringing the total size of the order to 6,415.

"The need for these vehicles supersedes all other programs right now," a Pentagon spokesman said at a press briefing, according to a Defense Department transcript.
"Force Protection's Cheetah vehicle, which is scheduled to start production in 4Q07, is the furthest along of any protected vehicle in its weight class, and as such is well ahead of competitors in terms of being able to supply large numbers to the Pentagon as soon as next year," Gremmels told clients.
Earlier this month, the companies received a $111.5 million contract to build 235 MRAP vehicles for the Marine Corps.