General Dynamics delivered 47 Piranha 5 transporters to MapN, out of the 133 provided for in the second phase of the contract

Recorded by George Marinescu
English Section / 30 mai

General Dynamics delivered 47 Piranha 5 transporters to MapN, out of the 133 provided for in the second phase of the contract

Versiunea în limba română

(Interview with Marinică Mîrzu, manager General Dynamics Romania)

The war in Ukraine and the new movements in the current regional context take place at a time when the Romanian Army has not met all its endowment targets, targets set in the ten programs for the acquisition of modern military equipment and technology.

Apart from the anti-aircraft shield at Deveselu, the Patriot defensive missile systems (out of the seven systems, only one is operational and the US is pressuring us to cede one system to Ukraine), the ongoing contract of the joint venture between General Dynamics and Uzina Mecanică Bucharest for the second contract in the program for the 226 Piranha 5 armored personnel carriers, the purchase of second-hand F-16 aircraft from Spain, Portugal and, recently, Norway, the HIMARS coastal defense systems and the transport trucks that are built in Petreşti by the Italian company Iveco, the rest of the purchase programs have been blocked for a long time, and some have been canceled - see the case of the purchase of marine corvettes, to be replaced by others regarding the purchase of helicopters, drones, even submarines and state-of-the-art combat technical equipment.

Recently, the authorities have expressed their intention that, starting from 2030, the F35 fighter plane will enter the equipment of the Romanian Air Force, as well as the intention to purchase self-propelled howitzers of tracked systems.

In these conditions, the organization, last week, in Bucharest of a new edition of the Black Sea Defense&Aerospace (BSDA) 2024 exhibition, represented an opportunity for Angel Tîlvăr - the Minister of National Defense - and Radu Ştefan Oprea - the Minister of the Economy, to find out what is new in this field and what would suit the urgent needs of the Romanian armed forces.

Among the participants at BSDA 2024 was also the company General Dynamics European Land Systems (GDELS) Romania, with whose representative, general manager Marinică Mîrzu, I conducted the following interview about how the contract for the construction of the Piranha 5 transporters is progressing and what will follow at its completion for the GDELS-Uzina Mecanică Bucharest association.

Reporter: What is the status of the Piranha 5 program developed in partnership with Uzina Mecanică Bucharest? Does it maintain the same sustained pace as in the last two years?

Marinică Mîrzu: At the association of GDELS Romania and UMB, we started the production of the 133 armored Piranha 5 from contract 2, this time with a Romanian manufacturer, last June. We are almost a year in and we have already built 47 complete vehicles which are in the receiving process with the beneficiary and another 21 vehicles are on the production line. After almost a year, we are approximately at half of the quantity stipulated in the contract, and we must deliver the rest of the vehicles by the end of 2025. In the last 12 months, at the same time as production, we have operationalized the GDELS Romania-UMB association and we currently have now the complete structure with 148 Romanian employees. The management is ensured by 43 people from GDELS Romania, including the heads of production and all station heads in the production line. The difference up to 148, i.e. 105 employees are the workers from the Bucharest Mechanical Plant. There are only three people left at GDELS Mowag (ed. - the factory in Switzerland that executed the first part of the Piranha 5 contract), who for the groups just transferred to contract 2 provide supervision.

Reporter: How did the professional training of UMB employees in this association take place, in order to make Piranha 5 in Romania?

Marinică Mîrzu: GDELS Romania, as the leader of the association, has the management of the entire joint-venture, so it also takes care of its own staff, as well as that of UMB. After a more difficult beginning of interpersonal relations at work, we managed to make a team. In the beginning, of course, the older people from Uzina Mecanică Bucureşti had younger managers and bosses from GDELS Romania, who had just arrived in the field, in the plant, and things did not go very well during that period. But later, including through similar equipment and equal treatment, to which was added the fact that salaries were paid on time without any delay, we managed to make them understand that they are all part of the same team, with the same interest. I told them that they basically work for the same company, even if they are part of two separate companies, a company that has 130 military vehicles to build. We have a hierarchical and fair salary system at GDELS Romania. At UMB, steps were taken in the sense that, within the joint venture, ways were found - because being a state company there is a salary scale - to reach a better salary; thus the salary has increased for everyone working in the joint venture, and this is part of the management team's decisions. Employees are satisfied with the new salary increase and the fact that they receive their salaries on time.

Reporter: What is the average age of employees in the joint venture? It is known that in state companies in our country the number of employees approaching retirement age is quite high.

Marinică Mîrzu: The average age of the employees of GDELS Romania is up to 35 years, and in the joint venture with UMB the average age is under 50 years. Uzina Mecanică Bucharest did something: compared to 40 employees who also worked in the 1st contract with GDELS Mowag and who were on the verge of retirement and with a lot of experience, they had to supplement this number of employees up to the 105 existing now, through hiring, recruitment and training, and as a result of this process the average age of UMB employees has decreased. Now we also have people at UMB who are 20-30 years old, which is a good thing for the future of the association.

Slovenia, interested in a G2G agreement regarding the Piranha 5 carriers made in Bucharest

Reporter: How do you deal with the supply, with what is needed to make the production? Are there still supply chains for various products needed for Piranha 5?

Marinică Mîrzu: Supply for manufacturing execution consists of two parts. We have direct contracts from the association to the Romanian suppliers of essential subsystems as they are defined in the government decision - the weapon system, the optics system, sensors and communications. Now in contract 2 and the casing is manufactured in Romania, at UMB, where it is welded, painted and sandblasted. Some of the components that were not considered essential are made available to us through the GDELS Mowag supply chain. There are difficulties all over the world in the supply chains due to the existing situations on a global level. There are some components that are in short supply globally. For example, some simple important military connectors were delivered late because something happened in the supply chain, but with all that at the vehicle production level we are fine. We will not go into the daily details of difficulties, but as a final result we have the 47 vehicles in the process of reception by the beneficiary and another 21 on the production line at UMB.

Reporter: Are you ready to expand production and sell your product to other countries in Southeast and Eastern Europe? I know that Bulgaria expressed interest at one point in purchasing Piranha 5 vehicles.

Marinică Mîrzu: For me, as the manager of the company that is the leader of the association, I am also concerned about continuity in activity, not only to ensure existing jobs and people's salaries, but let's not forget Romania's essential security interest, an interest that was the basis of this program. We have been asked to build a strategic capability in our country for manufacturing and in-service maintenance, but you not only have to build that capability, you have to maintain it. If you did and within a few years of completing the contract it's gone, I've accomplished absolutely nothing. That is why we are concerned with the continuity and durability of this construction. As a result, we are interested in other contracts besides the ones that exist at the moment. We recently received a delegation from Slovenia that has been wanting to do a G2G (Government to Government) agreement for armored personnel carriers for some time. Their intention has been known to us since last year. At the invitation of some representatives of the Romanian Government, those from Slovenia came to Bucharest, visited our production capacity, we had discussions with them and it is possible to conclude such an agreement. Also, GDELS has a program for the Republic of Moldova, and we - the Romanian subsidiary - are struggling to participate and bring value to that program. However, I mention that Piranha 5 is still needed in Romania; there is an approval of the Parliament for an addition of 150 transporters to the initial contract, transporters that will also reach the Romanian Army.

"We want to design in Bucharest for the entire GDELS group"

Reporter: According to the contract, at the end of production you only have to deal with maintenance. But if you will remain only on maintenance, there is a high risk that the fate of the association will be identical to that of state-owned companies in the defense industry, which are on the verge of insolvency.

Marinică Mîrzu: Knowing this, we are concerned not only to complete this contract, but also to have continuity through coverage with other contracts. I believe it is a broad and fair understanding of the national security interest to hold backin life, but in production, this capacity that we achieved at the Bucharest Mechanical Plant.

Reporter: In this context, do you have the consent of the GDELS to hire a team of designers to design new types of military equipment?

Marinică Mîrzu: Within the sustainability action of GDELS Romania and the association we have with Uzina Mecanică Bucharest, there are several actions. One is the one I mentioned about entering into other contracts. I have a plan that I discussed with the GDELS management, and this plan also includes what you said. We actually have two ideas. The first is to do something so good, efficient and competitive here so that as many times as that activity in the GDELS group is needed, the association in Romania will turn to it. So we have to be good at something, and here I mean primarily production. The second idea is to have a design team, for example Renault, which has a design group in Romania for the whole company. I have discussed this with the people from GDELS because in order to establish this team, a very large investment is not needed. There is no need for equipment, tools or other installations, but software design tools are needed, and we have very good Romanian engineers. We want to design something here for the whole GDELS group. We have a list of opportunities that we want to take advantage of.

Reporter: Thank you!