Post by Keith Heitmann on Jan 28, 2005 19:34:02 GMT -5
Lockheed Martin Wins $1.6 Billion Marine One Contract
By LESLIE WAYNE
Published: January 28, 2005
he Pentagon today chose the Lockheed Martin Corporation and a group of international partners over an American-only team headed by the Sikorsky Aircraft Company to build the next fleet of presidential helicopters, perhaps the most prestigious aircraft contract in the world.
The $1.6 billion contract is not be the biggest ever handed out by the Pentagon, but it gives the winner global bragging rights and touches on the politically sensitive question of whether a president should be ferried around in a craft - known as Marine One when a president is aboard - that is made only in the United States or one that has some foreign parts, design and ownership.
For decades Connecticut-based Sikorsky has supplied most of the helicopters in the presidential fleet. George David, chief executive of United Technologies, the parent company of Sikorsky, told analysts before the announcement that "this is win or drop dead as far as we are concerned."
Analysts echoed that thought in advance of the announcement.
"Whoever wins the contract will have free advertising for the next 30 years," said Paul Nisbet, a military analyst with JSA Research, an aerospace research firm in Newport, Rhode Island. "Every time the president jumps on a helicopter, you see it."
The decision was made by a Navy source selection committee and was reviewed by Defense Secretary Donald H. Rumsfeld.
As the White House pressed the Pentagon for a quick decision, the Navy issued a report last week saying that the fast-track selection process for the new helicopter did not provide for sufficient pre-flight testing of the craft and violated the fly-before-buy concept.
In addition, the crash of a Sikorsky-made Marine CH-53E helicopter in Iraq this week, with the loss of all 31 aboard, illustrated the relative fragility of helicopters in general, which are far less stable than airplanes. While the version that Sikorsky was designing for Marine One was completely different than the one that crashed in Iraq, the timing could not have been worse for the company.
In many ways, the battle is over more than a helicopter. The selection of a partly foreign offering could quell complaints about the American military market's being closed to foreign suppliers and could be a way of rewarding some of the Washington's staunchest allies in Iraq.
But that consideration runs up against growing "Buy America" sentiment among members of Congress that ultimately determine the size of the Pentagon budget.
There were tremendous shows of confidence by both sides, said Richard Aboulafia, a military analyst at the Teal Group, an aerospace consulting firm in Northern Virginia. "The popular talk seems to be swinging from one side to the other," he said before the announcement. "It's been that tight."
While the helicopters are flown and maintained by the Marine Corps, it is acquired by the Department of the Navy, which includes the Marines.
The exact standards used by the Navy to select the new craft will never be known, since the mission of carrying the president is shrouded in secrecy. No one knows the exact specifications of the craft, its performance requirements and the sensitive equipment that it must carry. The government has never made public the requirements and specifications for the aircraft, so it is hard to judge which contractors' version is better suited for the job, said Loren Thompson, a military analyst at the Lexington Institute, a Northern Virginia nonprofit that advocates smaller government.
The Lockheed side includes Augusta-Westland, which is majority-owned by Fionmeccanica of Italy. Their offering, the three-engine US101, is a variant of a helicopter used by the British Royal Navy and other European countries. Still, to position itself an American offering, Maryland-based Lockheed was running around the country, lining up suppliers and promising that the bulk of the craft would be built in the United States. And, in a bid to win presidential favor, Lockheed said that the airframe of the craft would be built by Bell Helicopters in Texas.
Sikorsky also made the same Texas pledge, saying it would hand off airframe construction to Vought Aircraft Industries in Dallas.
Last week, Senator Charles Schumer, Democrat of New York, announced that he had called Mr. Rumsfeld and personally pushed the defense secretary on Lockheed's behalf, according to a press release from Mr. Schumer's office.
The Italian prime minister, Silvio Berlusconi, proved to be a dogged lobbyist for the venture, as well.
In a pre-Christmas meeting with Mr. Bush at the White House, Mr. Berlusconi was relentless. In response to an answer from an Italian reporter at a joint press conference, Mr. Berlusconi said the Italian helicopters were almost completely made and manufactured in the United States.
In response, Mr. Bush parried back: "With U.S. parts. I've got the message, yes."
But Mr. Berlusconi would not drop the issue, and continued, saying, "I can only say that I've been flying these helicopters for 30 years and I'm still here."
To which, Mr. Bush quipped back: "And you never crashed. That's a good start."
In a more serious mode, Mr. Bush said of the international bid: "I'm very aware of the joint venture. I understand the nature of U.S. jobs that will be created in the venture, and I assured him the venture will be treated fairly."
Beside the Italian prime minister, Lockheed also made an alliance with the Choctaw Indians in Mississippi with the promise of jobs if Lockheed landed the contract.
Just a few days ago, Lockheed announced a list of 42 California companies that would get business as well as 37 parts suppliers in the New England area.
On the Sikorsky side, the company offered decades of experience in building Presidential helicopters. Sikorsky's VH-92 Super Hawk is a variant of the new S-92 midsize helicopter that it made with international partners. The fact that Sikorsky lost a $39 billion contract to build the Comanche helicopter, a program that the Pentagon scrapped last year, had led some analysts to believe Sikorsky might benefit from a sympathy vote in the Marine One competition.
In Washington, the lobbying was fierce. Both companies promoted their respective causes with posters in Metro stations touting their offerings, and Sikorsky engaged retired Gen. Barry R. McCaffrey, the most highly decorated four-star general in the Army and a former head of the White Houses antidrug effort, to head its effort.
And no one was more energetic on Sikorsky's behalf that Representative Christopher Shays, Republican of Connecticut, who has been pitching for home-state Sikorsky on this issue since 2003.
Sikorsky's All-American pitch has gained a following among important conservative commentators. And in an appearance on Fox News, Mr. George, the United Technology's chief executive, gave a spirited pitch for Sikorsky's offering and easily won converts.
"I've got to tell you," the Fox host Neil Cavuto said, "I don't want to see a French firm carting our president around. I mean, were not going to see that, are we?"
Mr. George responded that Sikorsky helicopters had flown presidents for over 50 years and
"we'd like another half-century, too."
By LESLIE WAYNE
Published: January 28, 2005
he Pentagon today chose the Lockheed Martin Corporation and a group of international partners over an American-only team headed by the Sikorsky Aircraft Company to build the next fleet of presidential helicopters, perhaps the most prestigious aircraft contract in the world.
The $1.6 billion contract is not be the biggest ever handed out by the Pentagon, but it gives the winner global bragging rights and touches on the politically sensitive question of whether a president should be ferried around in a craft - known as Marine One when a president is aboard - that is made only in the United States or one that has some foreign parts, design and ownership.
For decades Connecticut-based Sikorsky has supplied most of the helicopters in the presidential fleet. George David, chief executive of United Technologies, the parent company of Sikorsky, told analysts before the announcement that "this is win or drop dead as far as we are concerned."
Analysts echoed that thought in advance of the announcement.
"Whoever wins the contract will have free advertising for the next 30 years," said Paul Nisbet, a military analyst with JSA Research, an aerospace research firm in Newport, Rhode Island. "Every time the president jumps on a helicopter, you see it."
The decision was made by a Navy source selection committee and was reviewed by Defense Secretary Donald H. Rumsfeld.
As the White House pressed the Pentagon for a quick decision, the Navy issued a report last week saying that the fast-track selection process for the new helicopter did not provide for sufficient pre-flight testing of the craft and violated the fly-before-buy concept.
In addition, the crash of a Sikorsky-made Marine CH-53E helicopter in Iraq this week, with the loss of all 31 aboard, illustrated the relative fragility of helicopters in general, which are far less stable than airplanes. While the version that Sikorsky was designing for Marine One was completely different than the one that crashed in Iraq, the timing could not have been worse for the company.
In many ways, the battle is over more than a helicopter. The selection of a partly foreign offering could quell complaints about the American military market's being closed to foreign suppliers and could be a way of rewarding some of the Washington's staunchest allies in Iraq.
But that consideration runs up against growing "Buy America" sentiment among members of Congress that ultimately determine the size of the Pentagon budget.
There were tremendous shows of confidence by both sides, said Richard Aboulafia, a military analyst at the Teal Group, an aerospace consulting firm in Northern Virginia. "The popular talk seems to be swinging from one side to the other," he said before the announcement. "It's been that tight."
While the helicopters are flown and maintained by the Marine Corps, it is acquired by the Department of the Navy, which includes the Marines.
The exact standards used by the Navy to select the new craft will never be known, since the mission of carrying the president is shrouded in secrecy. No one knows the exact specifications of the craft, its performance requirements and the sensitive equipment that it must carry. The government has never made public the requirements and specifications for the aircraft, so it is hard to judge which contractors' version is better suited for the job, said Loren Thompson, a military analyst at the Lexington Institute, a Northern Virginia nonprofit that advocates smaller government.
The Lockheed side includes Augusta-Westland, which is majority-owned by Fionmeccanica of Italy. Their offering, the three-engine US101, is a variant of a helicopter used by the British Royal Navy and other European countries. Still, to position itself an American offering, Maryland-based Lockheed was running around the country, lining up suppliers and promising that the bulk of the craft would be built in the United States. And, in a bid to win presidential favor, Lockheed said that the airframe of the craft would be built by Bell Helicopters in Texas.
Sikorsky also made the same Texas pledge, saying it would hand off airframe construction to Vought Aircraft Industries in Dallas.
Last week, Senator Charles Schumer, Democrat of New York, announced that he had called Mr. Rumsfeld and personally pushed the defense secretary on Lockheed's behalf, according to a press release from Mr. Schumer's office.
The Italian prime minister, Silvio Berlusconi, proved to be a dogged lobbyist for the venture, as well.
In a pre-Christmas meeting with Mr. Bush at the White House, Mr. Berlusconi was relentless. In response to an answer from an Italian reporter at a joint press conference, Mr. Berlusconi said the Italian helicopters were almost completely made and manufactured in the United States.
In response, Mr. Bush parried back: "With U.S. parts. I've got the message, yes."
But Mr. Berlusconi would not drop the issue, and continued, saying, "I can only say that I've been flying these helicopters for 30 years and I'm still here."
To which, Mr. Bush quipped back: "And you never crashed. That's a good start."
In a more serious mode, Mr. Bush said of the international bid: "I'm very aware of the joint venture. I understand the nature of U.S. jobs that will be created in the venture, and I assured him the venture will be treated fairly."
Beside the Italian prime minister, Lockheed also made an alliance with the Choctaw Indians in Mississippi with the promise of jobs if Lockheed landed the contract.
Just a few days ago, Lockheed announced a list of 42 California companies that would get business as well as 37 parts suppliers in the New England area.
On the Sikorsky side, the company offered decades of experience in building Presidential helicopters. Sikorsky's VH-92 Super Hawk is a variant of the new S-92 midsize helicopter that it made with international partners. The fact that Sikorsky lost a $39 billion contract to build the Comanche helicopter, a program that the Pentagon scrapped last year, had led some analysts to believe Sikorsky might benefit from a sympathy vote in the Marine One competition.
In Washington, the lobbying was fierce. Both companies promoted their respective causes with posters in Metro stations touting their offerings, and Sikorsky engaged retired Gen. Barry R. McCaffrey, the most highly decorated four-star general in the Army and a former head of the White Houses antidrug effort, to head its effort.
And no one was more energetic on Sikorsky's behalf that Representative Christopher Shays, Republican of Connecticut, who has been pitching for home-state Sikorsky on this issue since 2003.
Sikorsky's All-American pitch has gained a following among important conservative commentators. And in an appearance on Fox News, Mr. George, the United Technology's chief executive, gave a spirited pitch for Sikorsky's offering and easily won converts.
"I've got to tell you," the Fox host Neil Cavuto said, "I don't want to see a French firm carting our president around. I mean, were not going to see that, are we?"
Mr. George responded that Sikorsky helicopters had flown presidents for over 50 years and
"we'd like another half-century, too."