Navy Secretary John Phelan said Tuesday the service is on track to stand up its remaining five Portfolio Acquisition Executives (PAEs) in the coming months, completing a sweeping overhaul of part of the Department of Defense’s (DOD) broader efforts to reform its weapon acquisition process.
Under the Trump administration, the DOD has been rebranded as the Department of War.
Speaking at the Sea Air Space conference in National Harbor, Md., Phelan said the final positions will cover industrial operations, Marine Corps, maritime systems, strategic systems programs, and undersea capabilities, bringing the total number of PAEs to six. The Navy stood up its first PAE focused on robotics and autonomous systems in late 2025.
“We have reorganized how we manage acquisition,” Phelan said. “We’ve established portfolio acquisition executives, single accountable leaders responsible for delivering results across defined portfolios.”
The PAE structure stems from a broader DOD effort announced in November 2025 by Defense Secretary Pete Hegseth to accelerate the delivery of new technologies to U.S. forces. Under the model, PAEs oversee portfolios of major weapons programs, report directly to service acquisition executives, and have authority to act without lengthy approval chains.
Last month, the Navy named interim leaders for the remaining portfolios: Vice Adm. James P. Downey for Industrial Operations; Lt. Gen. Eric Austin for Marine Corps; Christopher Miller for Maritime; Vice Adm. Johnny Wolfe for Strategic Systems Programs; and Vice Adm. Robert Gaucher for Undersea.
Each PAE will also be supported by a Rapid Capability Cell aligned with the Navy’s Rapid Capabilities Office, aimed at speeding adoption of commercial technologies, rapid prototyping, and fielding solutions for urgent operational needs.
Phelan said the changes are intended to streamline decision-making and improve accountability across acquisition programs.
“We are ending the era of new, ever-changing requirements, continual testing, endless process and paperwork, delayed decisions, and diffused accountability,” he said. “This is how we move faster. This is how we reduce cost. This is how we deliver capability to the fleet on time.”
Phelan warns against a CR
During his keynote, Phelan also warned against the consequences of a delayed approved budget and a possible continuing resolution (CR), saying funding instability threatens readiness and modernization efforts.
Increasing readiness, he explained, “requires a budget that is passed on time and in full … a CR would have extremely negative consequences.”
Budget delays have been a recurring challenge in recent years, with Congress rarely passing appropriations bills before the Oct. 1 start of the fiscal year. For fiscal 2026, lawmakers approved a defense budget in February 2026, five months late.
“[CRs] impose constrained short-term funding, conditions that force legacy program trade-offs and impact our ability to innovate and therefore our readiness over time. That pattern of forced trade-offs has resulted in aging, corrupt infrastructure, legacy business systems, and practices,” Phelan said. “We can no longer live off these past CR decisions.”