Exploring the Potential of RTX to Address America's Drone Predicament
Exploring the Potential of RTX to Address America's Drone Predicament
Once more, drones made headlines this week, causing quite a stir among Americans along the East Coast. From New York's northernmost regions to Florida's southern tip, as well as an Air Force base in Ohio, unexplained flying objects resembling a blend of quadcopter and fixed-wing drones have been reported hovering overhead. The authorities, such as the FBI and Homeland Security, insist that there's "no evidence" suggesting that drones are a threat to national security or public safety. They allege that what individuals are witnessing might merely be private or commercial aircraft misidentified.
Nonetheless, the public is uneasy, and politicians are enraged. Senator Chuck Schumer from New York has pleaded with the White House to implement "special drone-detection tech" to monitor the skies over New York and New Jersey. Meanwhile, New York Governor Kathy Hochul desires a state-of-the-art drone detection system for her state. In the meanwhile, the Federal Aviation Administration has forbidden drone flying over substantial parts of central and northern New Jersey.
American or Dutch?
Banning their usage altogether is not a sustainable solution as drones are now an integral part of daily life. From families unwrapping DJI drones during Christmas to companies utilizing drones for crop health inspection and cellphone tower repairs, their use should not be banned. Rather, we require a solution to identify who is flying around up there.
Senator Schumer and Governor Hochul advocate for purchasing an "IRIS" radar system from Dutch company Robin Radar Systems. Already in use in Ukraine for detecting Russian drones, IRIS claims to provide a 360-degree field of view and the capability to detect flying objects up to 3 miles away. However, there's an American solution already available.
Reintroducing JLENS
I am referring to JLENS (Joint Land Attack Cruise Missile Defense Elevated Netted Sensor System) developed by RTX Corporation for the U.S. military in the early 2010s. Designed primarily for missile defense, the U.S. Army describes JLENS as being capable of detecting "all fixed- and rotary-wing aircraft, unmanned aerial vehicles, and land attack cruise missiles," among other threats.
Like IRIS, JLENS provides a 360-degree field of view, but with key advantages over the Dutch system. Instead of sitting on the ground, JLENS aerostats float two miles upstairs, extending their horizon, enabling a single JLENS to track multiple threats simultaneously up to a range of 340 miles. Furthermore, unlike IRIS, JLENS possesses fire-control radars among its suite of sensors and can direct active weapons systems to target and destroy threats as they're identified.
Time to activate JLENS again?
Regrettably, JLENS is not currently an active U.S. military program. In 2015, a JLENS system located at Aberdeen Proving Grounds in Maryland broke free from its ground tether, causing a headache for law enforcement agencies while attempting to bring it back down. Funding was subsequently cut by Congress, effectively canceling the JLENS project in the U.S.
Internationally, however, JLENS may still be in use - perhaps even in the Netherlands' backyard. Recently, the Pentagon informed Congress of Poland's request to purchase multiple aerostat systems for missile defense. The aerostats do not use the "JLENS" name, but they seem to serve the same purpose, with RTX named as the principal defense contractor on the sale.
JLENS vs IRIS
Assuming the U.S. plans to invest in military technology to address its drone situation, JLENS appears to be a more cost-effective solution than IRIS, although it might not seem so initially.
Details from a 2022 U.K contract suggest IRIS costs about $300,000 annually to operate compared to JLENS costing $235 million to purchase. At first, that may appear to make IRIS an attractive choice for drone control due to its lower cost. However, when considering the fact that JLENS can cover an area of 363,000 square miles with its 340-mile detection range and 360-degree field of view, it would require setting up more than 3,000 separate IRIS radars, resulting in a total cost of over $960 million.
Therefore, mathematically speaking, it appears that JLENS offers significantly more value for money than IRIS. Additionally, JLENS is a U.S.-made product, benefiting domestic companies, whereas IRIS is not.
Furthermore, buying JLENS could potentially speed up RTX's 10% long-term projected growth rate, making RTX stock a more appealing investment option than its 33 P/E ratio suggests today.
In light of the ongoing drone sightings and public concern, Senator Schumer and Governor Hochul have proposed investing in advanced drone detection systems. They suggest considering the American-made JLENS, developed by RTX Corporation, which boasts a 360-degree field of view and the ability to detect threats up to 340 miles away.
Given the potential benefits of JLENS, including its cost-effectiveness and ability to track multiple threats simultaneously, it could be a more viable solution than the Dutch IRIS system, particularly when considering its coverage area and potential impact on domestic companies' growth.