“This is a multibillion dollar business we’re trying to run here and it’s very difficult,” he told reporters at the show.

Army Secretary John McHugh, who served in Congress for 17 years, said he knew the situation was tough, but he still had “faith and trust” that U.S. lawmakers would come together after the election to work out a deal to stave off the cuts.

SCRAP HALF THE CUTS?

Congressional aides Oct. 22 described one interim solution under consideration that would scrap about half the automatic cuts due to take effect under the first year of sequestration, replacing them with more targeted savings, coupling some revenue increases and some spending cuts.

McHugh said the Army had begun some preliminary planning for what sequestration would entail, but said the service had not made any decisions affecting specific weapons or modernization programs because too many of the variables were not known.

Tom Arsenault, executive vice president for product sectors and chief technology officer of the U.S. unit of Britain’s BAE Systems, the current “mild state of paralysis” at the Pentagon was already having a tough effect on prime contractors and hundreds of smaller suppliers.

“It’s very difficult to plan in an environment with this much uncertainty. We plan for the worst, and hope for the best,” he told Reuters at the conference.

He said BAE was focused on helping the Army and other military services get more mileage out of the weapons they already had, while also working to reduce its own costs by consolidating facilities and laying off workers.

Donnelly said budget uncertainty and Congress’ failure to pass a budget for the 2013 fiscal year that began on Oct. 1 were delaying his company’s negotiations with the Navy for a second multiyear purchase of V-22 tiltrotor aircraft built by Textron’s Bell Helicopter and Boeing.