Boeing confident Navy will buy more Super Hornet fighting jets

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Boeing confident Navy will buy more Super Hornet fighting jets
By Roxana Tiron
Posted: 02/02/09 06:28 PM [ET]

After a two-year lobbying push, Boeing is increasingly confident that the Navy will buy more F-18 E/F Super Hornet fighter jets — keeping the company’s production line humming for at least another eight years.

Boeing and its large supplier base are shifting their strategy. They’ve fanned out their lobbying for a new multiyear contract for the Super Hornets to members of Congress outside the traditional defense committees, where the defense giant spent most of its capital in the past.
The company is also some of shifting some of its argument to match the economic winds. Like a growing chorus of defense companies, Boeing argues that Pentagon programs keep thousands of people employed across the country amid a recession.

The production of the Super Hornet employs 110,000 people in 44 states, said Bob Gower, vice president for Boeing’s F/A-18 programs.

Gower emphasized that the need for more Super Hornets arose well before the economic crisis and the attendant necessity to stimulate the economy. But the economic benefit is an added muscle in the lobbying battle, said Gower, who believes the result is growing momentum in Congress and in the Office of the Secretary of Defense for the program.

Dozens of senators and House lawmakers — from Washington state and Massachusetts to New York, North Carolina and Missouri — wrote to Defense Secretary Robert Gates late last year urging him to fund more Super Hornets in the 2010 budget.

Boeing manages the F-18 Hornet program out of St. Louis, and Sen. Kit Bond (R-Mo.) and Rep. Todd Akin (R-Mo.) have led the charge for several years to keep the production line open and build more Super Hornets.

“We feel very confident that the time is right for the multiyear [contract] because it is based on a need that was articulated before the economic meltdown,” Gower said in an interview. “The Navy is headed toward adding quantities of Super Hornet. I am feeling more confident now than I have to date.”

Gower stressed, however, that he does not think it’s a done deal and that the situation could change.

“All the indications we see are looking toward a multiyear [contract] of 149 aircraft,” Gower said.

At a House Armed Services Committee hearing last week, Gates signaled that the Navy is interested in looking into another multiyear contract.

Gates also told lawmakers that the Pentagon intends to pursue weapons systems and hardware that represent the “75 percent solution” rather than a small quantity of “99 percent exquisite systems.” This means using more of the existing technologies that can be continued at a lesser cost instead of more cutting-edge — and more expensive — technologies.

“We’ve begun to purchase systems that have more efficient rates for the production lines, and I believe we can combine budget stability and order rates that take advantage of economies of scale to lower costs,” Gates said.

To Boeing, that is an encouraging stance, Gower said.

Boeing will reach the end of a five-year contract with the Navy for Super Hornets this year. The company is also slated to deliver another 89 aircraft to the Navy beyond the multiyear agreement. Those remaining airplanes will be delivered by 2012, when the domestic requirement for the Super Hornets would end.

To reach another multiyear contract for 149 aircraft, the Navy would budget for an additional 60 fighter jets above the 89 that Boeing already is under contract to build. Combining those numbers would create a quantity large enough to require a multiyear contract.

Boeing argues the Navy would save 10 percent by buying the aircraft under a multiyear contract versus buying the planes on an annual basis. Under the current five-year contract, Boeing is projecting to save the Navy about $1 billion.

The Navy must submit a congressionally mandated report by March 1 detailing how it will address the strike fighter shortfall, how many Super Hornets it needs and what the projected savings would be from another multiyear contract.

The Navy has been looking at a series of options ranging from adding the minimum of 60 aircraft for the 149-plane contract to as many as 121 more planes for a 210-plane contract over a five-year period, according to industry sources familiar with the issue.

The procurement of additional Super Hornets is under consideration, but the Navy has not made a final decision, said Lt. Clay Doss, a Navy spokesman. He added that specific quantities cannot be discussed until the fiscal 2010 budget is submitted to Congress.

Navy officials, including the chief of naval operations, have said that the service will face a shortfall of at least 69 fighter jets by 2017. Some predict that number could go as high as 200. The shortfall will continue until the service completes the procurement of Lockheed Martin’s F-35C Joint Strike Fighters (JSFs) by 2025.

The Navy bases its fighter needs on three assumptions: that older versions of the F-18 (the A through D models) will fly for another 10,000 hours and won’t need to be replaced with the Super Hornet; that the Navy’s variant of the new Lockheed Martin-built Joint Strike Fighter will be ready over the next decade; and that the Navy will be able to buy 50 JSFs a year.

However, the Navy has uncovered problems with plans to extend the life of its F/A-18 Hornets that could burden efforts to mitigate a shortage of strike fighter aircraft. The Navy last summer found that keeping the A- through D-model Hornets flying longer will require additional inspections and modifications, as well as a longer time out of service.

Meanwhile, the Super Hornet is expected to share carrier decks with the JSF until 2030.

The stakes are high for Boeing. The company fears that it could be inched out of the domestic fighter jet business if the Navy does not buy more Hornets after 2012. Boeing and Lockheed are the only two U.S. fighter assembly companies.

Boeing officials fear that by the time the Navy or Air Force wants a new strike fighter or bomber, Lockheed will be the only company with the design, engineering and production capability left to step up to the plate if the Super Hornet is phased out.

Source
http://thehill.com/index2.php?option=com_content&task=view&id=79387&pop=1&page=0&Itemid=32