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DUBAI: Boeing looks for ways around supplier impasse for Saudi AH-6is

A bitter dispute with a key supplier will not prevent Boeing from completing deliveries of the long-delayed AH-6i scout helicopter to the Saudi Arabian National Guard (SANG) and try to sell the aircraft to new customers.

“We have the rights obviously to pursue that in the marketplace, and we will meet our customer commitments,” says Gene Cunningham, Boeing’s vice-president for military aircraft in Saudi Arabia.

Asked if Boeing was dependent upon MD Helicopters – a critical AH-6i supplier embroiled in a lawsuit with Boeing over the delayed deliveries to the SANG – to supply airframes to continue AH-6i production, Cunningham answered unequivocally.

For all the coverage from the Dubai air show visit our dedicated event page

“No,” Cunningham told FlightGlobal in Dubai on the eve of the air show. “Based on the criteria that are out there, we have the ability to provide what needs to be done for that aircraft going forward.”

In 2012, the SANG ordered 24 Boeing AH-6i Little Birds under an agreement that called for all aircraft to be delivered by the end of 2014. But Boeing had delivered only nine of the 24 as of last June.

The reason for the delays emerged in court filings after AH-6i supplier MD Helicopters sued Boeing in September for refusing to pay invoices on the nine AH-6is delivered to date.

A month later, Boeing counter-sued, alleging that MDHI had delivered the AH-6i airframes with parts missing. Boeing also claims MDHI is purposely delaying the AH-6i programme to promote an internal competitor – a military version of the MD-500. Last September, the Afghan Air Force placed an order for up 150 MD-350Fs.

The AH-6i is derived from the Boeing MH-6M Mission Enhanced Little Bird, but that aircraft is a derivative of the MD-500. Boeing originally acquired the rights to the MD-500 with the 1997 acquisition of McDonnell Douglas. A year later, Boeing sold three commercial helicopter programmes – the MD-500, MD-600 and the MD-902 Explorer – to MDHI, but kept the rights to the MELB design.

In court documents, Boeing claims that MDHI officials have stopped returning emails or phone calls from Boeing’s AH-6i programme staff.

To resume AH-6i deliveries to the SANG, Boeing may need to find an alternate supplier for the AH-6i airframe.

Separately, Boeing is continuing to look to the Middle East region as a potential source of sales for two aircraft models the company continues to build in the absence of firm orders.

In a financial filing in October with the US Securities Exchange Commission, Boeing said it would continue building up to 31 F/A-18E/F Super Hornets in the absence of a firm order. The company remains in discussions with several US and international customers to claim the aircraft. Middle East countries are also potential buyers, Cunningham says.

“There certainly could be,” he says. “The issue becomes we’ve got a number of customers out there so which ones sign up and commit?”

The same situation exists with the C-17 production line. Boeing built one of the four-engined airlifters that it still has not sold. The US Air Force remains in sales discussions with the Indian air force. But Boeing also could sell the last remaining C-17 to top-off an existing operator elsewhere, including the Middle East, Cunningham says. Qatar, Kuwait and the UAE currently operate C-17s in the region.

For all the coverage from the Dubai air show visit our dedicated event page

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