HASC Wants To Continue VH-71

June 19, 2009 by Matthew Potter · Comment
Filed under: Business Line, Companies, Congress, Countries, Department of Defense, Events, Federal Budget Process, Finemeccanica, Italy, Lockheed Martin, Military Aviation, Services, U.S. Navy, development program 

In their markup of the 2010 Defense Appropriations Bill the House Armed Services Committee added money for continued production of the F-22. It also recommended that the Navy and Defense Department continue production of the Increment One of the VH-71 New Presidential Helicopter.

They feel that this would be the best use of the over $3 billion already spent on the program. There is obviously still a requirement for this aircraft and a new program is planned. The HASC wants the first group of VH-71 to be used as “the normal transport for the President…” with other systems looked at for the more stringent requirements. Right now the President uses VH-3 for short range, normal duties and then longer ranged CH-53 and UH-60 for other missions. One of the problems faced by the VH-71 was the attempt to buy one aircraft to do all missions.

Finemeccanica had offered to just deliver Increment One aircraft at reduced price for the total program. Of course these did not meet all of the requirements that the Navy had levied. This was a major reason the program’s cost and schedule increased so much.

So far the HASC markup does not necessarily agree with the Obama Administration’s proposals in the area of the F-22 or the VH-71. The bill still needs to go through the process of other committee markups, the full House and Senate and then the Conference. This means that this language may or not make it to the final version but it does show support for the VH-71 program.

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Lockheed Plans Further Job Cuts Due To VH-71 Ending

June 17, 2009 by Matthew Potter · Comment
Filed under: Business Line, Companies, Congress, Countries, Department of Defense, Events, Federal Budget Process, Finemeccanica, Italy, Lockheed Martin, Military Aviation, New York, Restructuring, Services, States, Suspensions, U.S. Marine Corps, U.S. Navy, development program, production program 

Lockheed Martin had already cut over one hundred jobs at their Upstate New York facility in Owego. This was mainly due to the decision by Obama and Secretary of Defense Gates to end the VH-71 New Presidential Transport helicopter program. Even though the aircraft was made in Italy Lockheed did all the modifications and integration in Owego.

Despite a great deal of argument and pressure to keep the program going in some form or another the contract was recently terminated. Lockheed is now saying that another seven hundred and fifty people may lose their jobs. Right now they are looking for people to voluntarily leave or retire with a promise of severance. The plan is to begin the layoffs in July based on how many people agree to leave voluntarily.

One of the arguments against ending this and other production programs is that they will just add to the joblessness during the current recession. Of course the defense budget is not really a jobs program and that is fairly poor reasoning to continue spending billions of dollars on a system that does not meet requirements. It is still possible that Congress will pass some form of spending that will keep pieces of the program alive in the 2010 defense budget but that will not be finished until the Fall.

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CAGW Advises Congress Not to Ground Presidential Chopper — Press Release

May 20, 2009 by Matthew Potter · Comment
Filed under: Business Line, Companies, Congress, Countries, Department of Defense, Events, Federal Budget Process, Finemeccanica, Italy, Lockheed Martin, Military Aviation, Proposal, Services, U.S. Navy, development program, production program 

CAGW Advises Congress Not to Ground Presidential Chopper

WASHINGTON–(BUSINESS WIRE)–Citizens Against Government Waste (CAGW), the nation’s premier taxpayer watchdog organization, today expressed support for the continuation of the VH-71 Presidential Helicopter Program. President Obama included the program on the list of program terminations and reductions to the fiscal year (FY) 2010 budget, which he released on May 7, 2009 in a bid to whittle $17 billion out of his overall $3.6 trillion budget. The President had stated in February, 2009 that the helicopter he currently uses “seems perfectly adequate” and added, “I think it is an example of the procurement process gone amok. And we’re going to have to fix it.”

But even in his recommendation to terminate the program, Defense Secretary Robert Gates acknowledged that a new fleet of presidential helicopters is necessary due to the advanced age and technological limitations of the current fleet. In a post-9/11 world, there is broad consensus that the President should not be flying Vietnam-era technology.

“CAGW applauds the President’s desire to cut wasteful spending, but taxpayers are between a rock and a hard place on the helicopter issue,” said CAGW President Tom Schatz. “One of the most common axioms of aviation is that every takeoff is optional, but every landing is mandatory. The same could be said now about the $13 billion program to fund the new fleet of presidential helicopters.”

It has become increasingly clear that it won’t be as cost effective as it may have appeared to terminate the VH-71 program. More than $3 billion has already been invested in the program to cover the R&D and production costs of the first phase. Navy officials estimate that program termination and liability costs will be $555 million. Factoring in costs already incurred and shut-down fees, terminating the program now would leave taxpayers with nothing to show for nearly $4 billion – even though nine new aircraft have been produced that meet performance requirements. “This program is also another example of the rampant lack of realistic budgeting and absence of fiscal discipline in the Pentagon’s procurement process,” said Schatz.

More alarming, according to a recent memo prepared by House Armed Services Committee staff, the Navy has told Congress it will require billions of dollars to extend the life of the current fleet of presidential helicopters, which are already 35 years old, in order to keep them in operation for another decade until a new program can be devised. “In light of these facts,” said Schatz, “starting a do-over program from scratch would be even more costly than completing the current program – leaving the taxpayer to foot the bill twice rather than maximizing the current investment. Given the urgent security needs of the President and the massive amount of money that would be wasted should the Pentagon and the White House terminate the program at this late stage, the prudent course would be to move forward, take possession of the helicopters we have paid for, and find a responsible solution both for the taxpayer and the Office of the President.”

Citizens Against Government Waste is a nonpartisan, nonprofit organization dedicated to eliminating waste, fraud, abuse, and mismanagement in government.

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Alenia Aeronautica Concludes Successfully The First Flight Campaign In Italy Of The Sky-Y Unmanned Aircraft – Press Release

March 31, 2009 by Matthew Potter · Comment
Filed under: Alenia Aeronautica, Business Line, Companies, Countries, Events, Finemeccanica, Italy, Military Aviation, Press Releases, development program 

italian-1Alenia Aeronautica Concludes Successfully The First Flight Campaign In Italy Of The Sky-Y Unmanned Aircraft

With five missions the Sky-Y, Alenia Aeronautica’s unmanned technological demonstrator, has completed its first series of tests in Italy. With this tests campaign the Sky-Y has to day accumulated three test phases, two in Sweden and one in Italy.

Thanks to the Permit To Fly granted by ENAC – Ente Nazionale per l’Aviazione Civile (National Agency for the Civil Aviation), the Sky-Y has accomplished this flight testing cycle in an area in the Puglia Region, defined for this purpose.

The test campaign in Italy of the Sky-Y, the only European-made unmanned vehicle to make flight tests and the only one equipped with European sensors and production systems, has taken place in March, and has allowed the testing of some automatic functions of the ground surveillance mission systems; these are key elements to fully assess the operational capabilities of the production machines which will have in the future to be used for this role.

In particular, the tests campaign has brought to continuing the carrying out of the tests on the EOST-45 electro-optical sensor of SELEX Galileo – started in Sweden in the 2008 Autumn – and on the real-time data transmission via satellite.

In detail, the satellite link made by Telespazio has been used to test real-time data and images transmission with the Civil Defence Agency, during missions which simulated ground surveillance, fire control, detection and monitoring of boats’ and crafts’ traffic and of signalling of possible shipwrecked persons.

The tests recently completed in Italy have concerned also the functionalities of advanced management of the EOST-45 sensor, through an On Board Mission Computer (OBMC) provided with a software developed by Alenia Aeronautica; among such functionalities: target’s automatic tracking, automatic scan of pre-defined areas, definition of the geographical coordinates of the surface target under observation, on land and also, for the first time, on sea.

Thanks to these tests Alenia Aeronautica consolidates its own continental leadership in the technological and operational testing of unmanned aircraft. Alenia’s UAV technological demonstrator’s flights so far made are 48, of which 29 accomplished by the Sky-X and 19 by the Sky-Y. Such successes have been made also thanks to the support and collaboration of other Finmeccanica companies like SELEX Galileo and Telespazio, proving once more synergies and integration capabilities of the Group’s companies.

Alenia Aeronautica, a Finmeccanica Company, is the largest Italian aeronautic player which operates world-wide in the commercial and military aviation, unmanned aerial vehicles and aerostructures. Alenia Aeronautica also coordinates the activities of Alenia Aermacchi and Alenia Aeronavali – wholly owned companies – respectively active in the design and manufacturing of military trainer aircraft and in the overhaul, maintenance and modification of military and civil aircraft. With its joint ventures ATR, SCAC and Superjet International, Alenia Aeronautica is the world leader in the regional turboprop market and a top player in the regional jet sector. Over 2008 Alenia Aeronautica reported revenues of 2,530 millions Euro, backlog for 8,281 millions Euro and orders for 2,720. The total workforce is 13,907.

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Joint Cargo Aircraft Loses Boeing

February 27, 2009 by Matthew Potter · Comment
Filed under: Boeing, Business Line, Companies, Contract Awards, Countries, Events, Finemeccanica, Italy, L-3, Military Aviation, Restructuring, Services, U.S. Air Force, U.S. Army, commercial aviation, production program 

The U.S. Army and Air Force plan to purchase about seventy-eight Joint Cargo Aircraft (JCA). This is a light transport to supplement the C-130 primarily used for short haul missions in theater. The C-27J was selected to be the aircraft for the mission. This is a jet built by Finmeccanica in a joint venture with L-3 Communications. The team had been in discussions with Boeing to build an assembly plant for the originally European aircraft in the U.S. Now Bloomberg is reporting that Boeing is dropping out of the program due to the current world economic downturn. The plan is still to build a plant and assemble the aircraft in the U.S. but a new partner will have to be found or L-3 will have to spearhead the work. The JCA has had its issues mainly due to the Army and Air Force having different priorities for the aircraft but it had settled down with Low Rate Initial Production starting.

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US Government takes a step to allow DRS purchase by Finmeccanica

October 27, 2008 by Matthew Potter · Comment
Filed under: Acquisitions, DRS Technologies, Finemeccanica, IT, Italy 

The US Government’s Committee on Foreign Investment approved the planned acquisition of DRS Technologies by Italian company Finmeccanica. The deal is worth over $5 B and is structured as a stock purchase at $81 or so a share. DRS traded today at just over $80. DRS had long been rumored as an attractive takeover target, and the purchase by a European company again highlights their desire to get into the US Defense market.

See a short article at NJ.com.

Cross posted at BNET.

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DRS reports

August 9, 2008 by Matthew Potter · Comment
Filed under: Acquisitions, DRS Technologies, Finemeccanica, IT, Italy, production program 

DRS Technologies reported that sales were a record high for the last quarter. See an article here. DRS also reported a 40% increase in profits and a record backlog of over $1 B dollars. As discussed here, Finmeccanica has agreed to buy the American company. This would be one of the largest foreign acquisitions of an American defense company.

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Finmeccanica follows through

May 14, 2008 by Matthew Potter · 1 Comment
Filed under: Acquisitions, Agusta Westland, Congress, DRS Technologies, Finemeccanica, IT, Italy, production program 

Bump – Fresh off good financial reports for the quarter, EADS is now looking at DRS Technologies as well. See an article here. This makes it sound like DRS might be a good buy.

As rumored this weekend Finmeccanica bought DRS today. The deal is for around $5 B. See an article here. This is the biggest acquisition so far by an European company. DRS has been an attractive take over target for a few years, one of the reasons its stock was so high. If this deal can make it through the necessary regulatory and legal review it will be quite stunning. Prior to this BAE and EADS had been doing smaller acquisitions, under a $1B. In today’s political environment due to the KC-45 deal and it being an election year it should be interesting to see Congress’s reaction.

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Looking to buy DRS

May 11, 2008 by Matthew Potter · Comment
Filed under: Acquisitions, Finemeccanica, Italy, SETA, production program 

This article discusses the idea that Finmeccanica, the Italian defense conglomerate, is looking at DRS Technology for an American acquisition. Like EADS and BAE the Italian company has been expanding its presence in the US. Its helicopter arm, Augusta Westland, won the VH-71 Presidential helicopter teamed with Lockheed Martin and is also trying to win the CSAR-X recompete post-protest. DRS which makes advanced sensors and electronics while providing SETA services has long been an attractive take over target. It’s stock though has done very well recently and for Finmeccanica to buy it would require a substantial investment. Read more

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