War Of Words Continues On VH-71 With Lockheed In The Middle
The VH-71 New Presidential Helicopter program was ended by the incoming Obama Administration. It was way over cost and behind schedule. This was due for a variety of reasons but mainly due to the rather complicated requirements that the new aircraft had to meet. The program meant a lot to upstate New York as it provided good jobs in an area facing economic problems. This meant that the Congressional delegation from New York was very supportive of efforts to fix the program rather then end it.
Not only did the Administration not request any funds in 2010 for the program but they outright ended the contract. They are still negotiating termination costs with Lockheed Martin who had teamed with Finmeccanica to integrate the U.S. requirements on the Augusta-Westland built aircraft. As part of all this Lockheed went ahead and laid off about eight hundred workers in Owego, NY.
The program had been divided into two parts with Increment One procuring nine basic aircraft to do testing, development and some of the missions required of the aircraft. This increment was proceeding on schedule and the U.S. Navy had invested over $3 billion into it. The second Increment where there had to be an aircraft capable of meeting all of the requirements was where the problems were arising as Lockheed and its partners tried to integrate all of the new equipment and still meet performance goals.
The House included funding to do something with these aircraft to the tune of almost $500 million in their version of the Defense Appropriations Bill. The Senate did not and Conference is looming. It will be up to the House to convince the Senate to allow the money to remain and some kind of program started up again with the already purchased aircraft. The argument being made by New York Congressional Representatives, some in the industry and commentators is that the U.S. should not waste this initial investment in these aircraft and find some use for them. Congressman Hinchey (D-NY) who represents this area is one of the biggest proponents of this path and made sure the money was inserted in the bill and will also participate in the Conference on this bill.
Lockheed of course cannot directly comment on the situation as they must do what the military has directed. That has not stopped them from lobbying Congress and most likely the VH-71 was included in all of that. That is only a sound investment for the company.
On top of all this there is still a requirement for the new aircraft. The Navy has come up with a program to keep the existing VH-3 and VH-60 aircraft flying using money that would have gone to the VH-71. They have also started the process of developing a new program from the beginning. The first step in this is getting approval of the Initial Capabilities Document (ICD) which lays out the starting requirements for the program. Then a new contract will be let and development and engineering done to get to Low Rate Initial Production (LRIP).
Somehow Congressman Hinchey was able to get a copy of the new ICD and other program documents. Base on this he now claims that the cost of the new program will cost $20 billion and take fifteen years to field. The White House and Pentagon are denying this saying that the new program will cost less then $13 billion and be done in 2020. Of course this is based on initial estimates for an acquisition program that hasn't really started yet and historically programs tend to be late and over budget.
For Lockheed there is no guarantee that they will win the new contract or work on the new program. It is probably in their best interests, and that of their share holders, to try and keep a kernel of work going with the existing aircraft. Especially with the news yesterday that their stock was downgraded due to worries about the aerospace industry and pension costs. If Congress keeps the money in the 2010 bill that will certainly do that.