Atlantic Organization for Security (AOS)

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Presidential Helo Competition Complicated

by · June 17, 2010

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The myriad industrial relationships broken and reforged for the newly relaunched U.S. presidential helicopter competition seem to represent a larger trend in defense manufacturing. It’s not the world that’s shrinking, it’s the world economy.
Boeing announced June 8 it is buying full intellectual property, data and production rights from AgustaWestland for its AW101 aircraft. “This is not a partnership,” says Phil Dunford, vice president and general manager of Boeing Rotorcraft. “This will be a Boeing-built airplane.”
The two companies are forging a wide-ranging relationship. AgustaWestland stands to make a considerable amount of money on the sale of its intellectual rights to the AW101. And the company is now relieved of the burden of navigating an intercontinental business partnership. Boeing assumes the risk, while AgustaWestland reaps the rewards.
The reverse is true for Boeing, which sold its intellectual property rights to AgustaWestland on the CH¬47 Chinook, which is built and marketed to the Italians in Italy. Anywhere else in the world, the two companies compete against each other with the AW101 and CH-47 as their own platforms. With AgustaWestland holding a minority stake in the Bell Textron BA609 tiltrotor program, it is again linked to Boeing.
For the VXX Presidential Helicopter Program, Boeing is partnering with Bell Helicopter on a different offering—the V-22 Osprey, which was thrown into the mix. “There has been a lot of interest in the V-22,” says Dunford. And, he adds, in the CH-47 Chinook, which is the third Boeing response to the Navy’s RFI.
Meanwhile, AgustaWestland’s former partner on the VH-71, Lockheed Martin, has relinquished its lead role and teamed with Sikorsky Aircraft Corp. to pitch Sikorsky’s S-92 as a possible contender for the crown.
Neither Sikorsky nor Boeing will discuss the potential division of labor. “We’re looking at the best use of our respective facilities in terms of where the work gets done,” says Scott Starrett, president of Sikorsky Military Systems. Dunford says the AW101 production location “remains to be seen. The goal is to build as much of it as we can inside the Boeing Co.”
A strong “Buy American” sentiment in Washington is probably also driving some of the teaming decisions. AgustaWestland suffered in the first competition from not being an all-American company. By handing over the reins of the AW101 to Boeing, that argument is removed from the equation. Somewhat. Boeing has launched its own “Buy American” campaign for an entirely different contract award battle, and is already being pressed for specifics on just how American the Boeing 101 will be. “There are still components built in Europe,” Dunford says. “Depending on the time line, I would imagine they would be existing supply chains we would use.”
No formal request for proposals exists, the Navy is still muddling through its analysis of alternatives (AOA), and yet this complicated struggle to win the VXX bid is already in full swing. If it seems unusual to pitch a battle royal for a fleet of two dozen aircraft at most, it is because there are billions of dollars at stake, for AgustaWestland in particular. Seven of its VH-71s are sitting in storage at the Naval Air Systems (Navair) homestead at Patuxent River, Md.
Those aircraft could potentially be used as test articles if the so-called Boeing 101 wins the competition. The U.S. manufacturer could easily argue that the government could recoup its $2-plus-billion investment on the first, failed competition, by selecting a platform that has already been through the process. Now that it owns all the rights, Boeing would have only to make minor changes to fit the VXX RFP.
“Until the AOA is produced, we’re not going to know the way the customer will go,” Dunford says. “We will respond either individually or with a mix [of aircraft] depending on what the AOA says.”
Whatever the AOA determines about the acquisition process, which was saddled with ever-shifting requirements and a glut of agencies with a say in the matter, the request for information reveals the government’s interest in breaking down the program into more manageable pieces.
The presidential helicopter could be a single type model with two variants—one “fully appointed, executive” and another “significantly lighter, performance-based, C4I [command, control, communications, computers and intelligence] capable variant” with reconfigurable VIP amenities. Or, the solution may lie in two separate models altogether.
The Navy is being exceedingly cautious, refusing to release any information until its AOA is complete. “It is premature to estimate particular costs for any specific configuration,” the service said in a statement issued June 8. It also notes the RFI is simply a “first step in the data gathering stage of the AOA process.”
The Navy wants to address “all feasible options considering a holistic assessment of requirements, capabilities, cost drivers, schedule implications and risks.” Hoping, perhaps to avoid the issues that led to a 2007 judgment levied by a Navy evaluation of the program, called the Program Management Assist Group that pointed to “dysfunctional contractor behaviors” and unrealistic requirements from the White House.

Source: Aviation Week – By Bettina H. Chavanne, Andy Nativi

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