Posted on 01/29/2005 3:57:17 PM PST by Jordi
WASHINGTON (Reuters) - The U.S. Navy on Friday gave a transatlantic team led by Lockheed Martin Corp. (NYSE:LMT - News) a $1.7 billion contract to build a new fleet of 23 U.S. presidential helicopters, a deal valued at up to $6.1 billion.
The decision was a stunning setback for Connecticut-based United Technologies Corp.'s (NYSE:UTX - News) Sikorsky Aircraft unit -- which for nearly 50 years has built and maintained the green and white "Marine One" helicopters that fly the president.
Sikorsky had wrapped itself in the American flag to pitch its twin-engined VH-92, based on the Black Hawk helicopter.
But lower cost, a larger cabin and faster delivery schedule allowed No. 1 Pentagon supplier Lockheed to prevail with its US101, based on the three-engined EH101 made by AgustaWestland Inc., a unit of Italy's Finmeccanica SpA.
The deal attracted international attention, with Prime Ministers Tony Blair of Britain and Silvio Berlusconi of Italy personally pressing President Bush on behalf of Lockheed's British-Italian design.
Assistant Navy Secretary John Young said the decision came after an "exhaustive and deliberative" search and would ensure a high level of quality and safety for future presidents.
"This decision truly reflects the best value and capability for the American taxpayer who is funding it, the Marines who will operate it and future presidents who will fly in it," Young said in a statement.
He told reporters he received no guidance from the White House except to "pick the best value choice for the mission."
Texas-based Textron Inc.'s Bell Helicopter is the other big partner and Los Angeles-based Northrop Grumman Corp. will provide electronics for the new chopper.
Lockheed Vice President Stephen Ramsey said 65 percent of the US101 would be built in the United States, with the remaining 35 percent to be split between Britain and Italy.
Young downplayed any impact on the U.S. industrial base, saying both companies entered good bids and met "Buy America" provisions for U.S. content.
Sikorsky President Stephen Finger said the company was disappointed about the decision and insisted its VH-92 flew farther, faster and carried more than the EH101.
He said he was confident about the future of the company's S-92 program, and said Sikorsky still expected to double its business by 2008.
Sen. Joe Lieberman, a Connecticut Democrat, said the decision was "outrageously wrong" because Sikorsky had vowed to build a helicopter that was "100 pct made in America.
"I am committed to do everything in my power to right this wrong," Lieberman said in a statement, saying he hoped Sikorsky would challenge the contract award with federal officials.
Another Connecticut lawmaker, Rep. Rosa DeLauro, also a Democrat, vowed to introduce legislation requiring the new helicopters be made entirely in the United States.
Stephen Moss, president of AgustaWestland's U.S. arm, said the US101 team was prepared to move all production of the helicopter to the United States, if that became necessary.
He emphasized that the EH101 was a "proven product," with 99 helicopters already flying in Iraq and Bosnia.
The first model of the new presidential helicopter, to begin operations in October 2009, will have 2,500-horsepower engines built by General Electric and a range of 250 miles, compared with the 100-mile range of the current "Marine One" VH-3D.
Later, it will be upgraded to travel 350 miles at a speed of 140 knots. It will be able to carry 14 passengers and a crew of four, compared with just 10 now.
The cost of the new helicopter will begin at $75 million a copy, gradually rising to about $110 million, Young said.
Analysts said the win could give Lockheed and its partners a competitive edge when the Air Force buys 194 new search and rescue helicopters next year, although Young downplayed that, saying the requirements were very different.
In addition, it could help Bethesda, Maryland-based Lockheed sell another 200 helicopters to the U.S. Coast Guard and Department of Homeland Security in future competitions.
Sen. Charles Schumer, a New York Democrat, praised the decision in a press release, saying Lockheed's victory would bring hundreds of new jobs to its Owego, New York, plant.
Not good form.
I was wondering if it had something to do with the location of the corporation in CT.
Truth be told, I think the president should be on a US only built chopper.
Don't change titles to suit your whims; it is against FreeRepublic policy.
"On October 10, 1989, an Agusta 109A helicopter crashed in New Jersey, killing the pilot, co-pilot, and three passengers, who were top-echelon employees of the Trump Hotel and Casino enterprises." - link
I could easily be wrong, but I thought the Marines actually wanted this turkey.
I agree with Lieberman. I think it's naive to believe that we're ready for a purely global economy.
Well FWIW, Great Britain and Italy have been strong allies in the WOT.
Please include original titles.
Thanks.
Because the chopper is flown by the USMC. Hence "Marine One".
your point is well taken, but americans are suffering the most from the loss of our troops in addition to the outsourcing of good paying jobs.
this is so wrong, i'm really surprised it was OK'd.
Why in the world do we need this many high end helicopters for the executive branch? Seems like a lot of taxpayer's money for ostentation.
You can buy DaimlerChrysler shares on the Nyse (Nyse: DCX)
I didn't write that they were not relisted after stock option transfers.
At one time they were going to use the ch-53, but it didn't fit on the white house grounds well enough. I doubt the osprey would fit any better. Besides, it wouldn't look good to drop the president like a rock.
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