Shake-up for Air Force One helicopter, fixed-wing bidders

Washington DC
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A reported cost overrun for the US president's next helicopter fleet has loosened Lockheed Martin's grip on the contract, while the race for the prized Air Force One fixed-wing deal has narrowed to a single eligible platform supplier.

The two developments - timed only a day apart - keep the process of replacing ageing Sikorsky VH-3D helicopters and the Boeing 747-200-based VC-25 over the next decade an unlikely public controversy.

A Lockheed Martin/AgustaWestland team won a $6.8 billion contract in 2005 to deliver 28 VH-71s in two increments. Last March, Department of Defense officials acknowledged the US Navy grossly underestimated the scale of the challenge, and costs were expected to grow to $11.2 billion, or 65% above the baseline.

After the projections became official, the USN notified Congress on 29 January that the VH-71's costs had escalated at least 50%, triggering a mandatory review process under the Nunn-McCurdy law. The Pentagon now must decide to certificate the programme's relevance to national security and managerial competence or terminate the contract.

lockheed martin/agustawestland vh-71
 © Lockheed Martin

Lockheed's team is still working to deliver the flight-test and pilot production aircraft ordered in Increment 1 of the programme. But the Nunn-McCurdy review has stopped work on development of the Increment II design, which requires substantial structural changes to the aircraft, including new engines, rotor blades, gear box, drive train and tail cone.

There is no timeline for the recertification process, although USN officials have previously said they expect to complete the process in the first quarter.

The US Air Force, meanwhile, plans after 2017 to replace both VC-25s - delivered in 1990 - with three new-build commercial widebody aircraft.

In October 2007, the USAF invited EADS North America to submit data about the Airbus A380, the A340-600 and A330-200 for an early analysis of potential Air Force One bidders.

EADS NA began preparing to enter the bidding process, even posting job advertisements for an executive to market Airbus aircraft for the Air Force One replacement.

However, company executives announced on 28 January their decision to withdraw from the contest, saying the small size of the three-aircraft order would have prevented EADS from achieving a growth strategy based on moving jobs and engineering into North America.

EADS's removal leaves Boeing as the only platform supplier, with the 747-8 and 787 as most likely candidates for the order.