McDONNELL DOUGLAS (MDC) is gearing up to propose on 1 August a new multi-year C-17 procurement package to the US Air Force which would cut unit cost to $212 million, from about $300 million, and possibly even lower, for production of aircraft 33 to 120.

The move is critical to the long-term survival of the C-17, of which only 40 are now on firm order. The Pentagon's Defense Acquisition Board (DAB) is to decide in November on whether to authorise further C-17 production, purchase a non-developmental airlift aircraft (NDAA), or a mix of both.

MDC's major cost-cutting initiatives include:

renegotiation with suppliers for multi-year procurement to 2004, rather than one year at a time;

redesign of some parts to save manufacturing time and weight. A machined landing-gear pod bulkhead, for example, is being designed to replace the built-up assembly. The new bulkhead will save 2,100 assembly hours and 8,400 installation hours, and eliminates 16,000 fasteners and 1,500 parts. MDC is also studying a new low-cost nacelle design, which could cut aircraft weight by 1,360kg, and potentially save nearly $500 million over the remaining production run;

movement of parts manufacturing to more cost-effective locations within the MDC sites working on the C-17;

changes in processes on the shop floor, designed to cut down manufacturing time;

improved tooling, such as a high-speed machining system for the ramp bulkhead.

Over the past year, MDC has cut the average cost of the C-17 by 11%, or $29 million. Unit price is set to level off at or slightly under, $200 million.

USAF principal assistant acquisition chief, Lt. Gen. Richard Hawley, warns that anything much above this price will probably result in the purchase of more NDAAs (Boeing 747-400Fs/Lockheed C-5Ds) and fewer C-17s.

Source: Flight International