Hawker Beechcraft spent over $100 million on what?!

banner_AT-6.jpgIn one of the more perplexing turns we’ve witnessed on the defence beat, the US Air Force has apparently dismissed the Hawker Beechcraft AT-6 from consideration for the light air support (LAS) programme several months after receiving the company’s bid and only days before a scheduled contract award. And we don’t know why. Beechcraft says the USAF letter provided no basis for the decision. The USAF declined to comment on the status of either the AT-6 or the Embraer/Sierra Nevada bid based on the Super Tucano until after contract award in late November or early December.

But what really stands out is this statement from Beechcraft: “With our partners Lockheed Martin, CMC Esterline, Pratt & Whitney Canada, L-3 WESCAM and CAE, [we] have invested more than $100 million preparing to meet the Air Force’s specific requirements.”

More than [gulp!] $100 million? A couple of points to consider:

First, that’s quite an investment to win a contract for 15 turboprop-powered light attack aircraft that will be transferred to the Afghanistan air force. Sure, there could be a follow-on order for 20 aircraft to serve as trainers for USAF instructors, and other deals could follow (if the Senate can overcome its serious objections to such an aircraft). But the break-even point for this class of aircraft on a $100 million non-recurring bill must be very high.

Second, is that really how much it costs to win relatively small order for military aircraft these days? That sounds like KC-X money!


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