Cost Overruns Force Halt to U.S. Presidential Helicopter

 - January 16, 2008, 5:18 AM

AgustaWestland and U.S. partners Lockheed Martin and Bell Helicopters have run into big trouble over the supply of 28 VH-71 helicopters to the U.S. Marine Corps for presidential transport duties. The VH-71 is a version of the European EH101 that is produced in the UK and Italy. Last month, the Pentagon ordered prime contractor Lockheed Martin to stop work on the second portion of the estimated $6.1 billion contract, citing massive cost overruns. Work continues on an initial batch of five “pilot production” helicopters that are due for delivery next year. The company has also built four test articles, the first of which made its maiden flight in the UK last July. When the contract was awarded in January 2005, it was hailed as a big boost for the “transatlantic two-way street” in defense acquisition. But the process of customizing an already large and expensive helicopter appears to have run out of control. Compared to previous EH101s, the VH-71 has uprated GE CT7 engines, new avionics and enhanced communications. Before winning the contract, Lockheed Martin promised that 65 percent of the content would be American, and it signed 200 subcontractors in 41 states. Expensive new facilities were built by Bell at Amarillo, Texas, for production and by Lockheed Martin Systems Integration at Owego, N.Y. LM proposed another version of the EH101 for the U.S. Air Force Combat Search And Rescue (CSAR) requirement, but the Air Force chose the Boeing HH-47 (Click here to read more.) Now the Pentagon is now holding another competition for a CSAR aircraft, but the VH-71 troubles cannot be helpful to LM’s chances. The big winner could be Sikorsky, which proposed versions of the S-92 for both the presidential helicopter and CSAR competitions. This smaller helicopter could now be reconsidered for both requirements.