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AW sues US government over trainer deal

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AW sues US government over trainer deal

Old 23rd Sep 2014, 07:54
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AW sues US government over trainer deal

A unit of Italy's Finmeccanica SpA has sued the U.S. government to block the Pentagon's proposed award of an $800 million helicopter deal to an arm of Airbus Group EADSY -0.35% NV, alleging that the defense department violated its own rules for opening contracts to competition.

The U.S. Army stirred controversy from rival manufacturers during the summer with its plan to retire two types of training helicopters and replace them with 155 new Airbus UH-72 Lakota helicopters, without holding a competition.

AgustaWestland North America Inc., the Finmeccanica unit, asked a U.S. judge for a temporary restraining order barring the Army from awarding the helicopter contract to Airbus without a competition, according to the complaint filed on Sept. 19 with the U.S. Court of Federal Claims in Washington, D.C.

Representatives of the U.S. Army and the Justice Department, which represents the government in civil cases, didn't immediately respond to requests for comment on Monday.

While defense contractors regularly contest contract awards through the Government Accountability Office, it is unusual for them to go to court. However, the Pentagon has attracted two such suits this year.

Elon Musk's Space Exploration Technologies Corp. in April sued the U.S. government and a joint venture between Boeing Co. and Lockheed Martin Corp. over the award of a military satellite launch contract. That case continues.

Pentagon officials have conceded in recent months that the overall level of competition awards has dropped. Acquisition chief Frank Kendall last month issued new guidance aimed at boosting competition, including guidelines for proposed deals agreed without a contest.

The Army wants to retire its fleet of Bell TH-67 Creek and OH-58 Kiowa training helicopters made by the Bell Helicopters unit of Textron Inc., and replace them with Lakotas transferred from other uses and others bought new from Airbus.

The Army now uses the Lakota—a version of the EC-145 helicopter commonly used to transfer workers and supplies to offshore oil and gas platforms—for noncombat missions such as transport and reconnaissance.

AgustaWestland and Bell have both claimed the twin-engine Lakota will cost more to buy and operate than their own helicopters.

The Army has said it is cheaper to retire whole fleet types. It aims to save money by using the same helicopter for training and operating.

"We are dismayed that the Army is moving toward a sole-source procurement, involving more than $800 million in initial acquisition costs, with no publicly available cost analysis or open consideration of alternative platforms potentially better suited for this important mission," an AgustaWestland spokesman wrote in an emailed response.

The federal judge assigned to the case hasn't ruled on the request for a restraining order. On Monday she granted a request from AgustaWestland to refile part of its motion to correct non-substantive errors, according to a court filing.
AgustaWestland Sues U.S. Government Over Army Helicopter Plan - WSJ
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Old 23rd Sep 2014, 13:39
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This is a case of "damned if you do and damned if you don't."

Which rule is more important:
The direction to be more cost effective, to retire expensive to operate, aging systems, or the rule to compete contracts? Two different sets of directions, more or less mandates from Congress via different Acts of Congress.

Since the Army had already purchased a substantial number of these aircraft, it is within the Army's remit, subject to DoD (Executive Branch) approval and Congressional (Legislative Branch) oversight, to repurpose the aircraft. THis has been done before.

Example: The F-8 (Fighter/interceptor) was repurposed as a recce aircraft. So was the A-5 (bomber/attack) repurpoased as a recon aircraft. Likewise the F-111 ... a mod turned at bomber/attack aircraft into the EF - 111. Also Phantoms became Wild Weasels.

Navy repurpoed the CH-60S (logistics/cargo replacement for CH-46, Navy bersion) into Combat SAR and Minesweeping. (The latter still being a work in progress). It is now the MH-60S. No, they didn't have to ask AW permission.

I predict the Army will win ... but I've been wrong before.
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Old 23rd Sep 2014, 20:57
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AgustaWestland sues Airbus Helicopters re UH-72A

Hmmmm

AgustaWestland sues to block Army purchase of EC145 helicopters | Vertical Magazine - The Pulse of the Helicopter Industry

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Old 24th Sep 2014, 00:25
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The Army and DoD winning would set a very dangerous precedent.
The Army is not merely repurposing an existing fleet, is the acquisition of additional 155 helicopters over which AgustaWestland is suing.
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Old 24th Sep 2014, 09:24
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Back in the 80s I believe, Bell Helicopter appealed the U.S. Coast Guard's purchase of 90 Short Range Recovery Aerospatiale HH-65 Dolphins. The judge ruled that while it was true that the purchase did not meet the "Buy America Act", the Coast Guard could still make the purchase. Go figure.
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Old 24th Sep 2014, 10:26
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The judge ruled that while it was true that the purchase did not meet the "Buy America Act", the Coast Guard could still make the purchase.
Not exactly true, but true up to a point.

The aircraft were equipped with Lycoming LTS101-750B-2 engines (built in PA) and Rockwell Collins avionics (built in KS) and the aircraft were assembled in Grand Prairie, TX. That pushed the cost basis beyond 51% American, and so made the purchase legal. Similar attempts of late with the VXX program and the KC-X program have not met with success.

The LTS101s were a disaster, while the avionics were pretty good. The airframes have since been refit with Turbomeca engines, so now they are much more French and closer to the original design than they started out, but still don't much resemble any civil Dauphin.

Bell's position wasn't much stronger going in, as much of their manufacturing base was in Canada, though they were headquartered in the U.S. The 222 (Bell's offering) would have been a poor alternative, operating from Coast Guard cutters. Very underpowered at the time of the RFP, and that teetering head is not what the doctor ordered operating from tiny ships.
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Old 24th Sep 2014, 11:56
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Not exactly true, but true up to a point.
The older I get, the wronger I get, but my recollection is that the engines did not bring the American part to 51%, which is what outraged me at the time. I don't get too outraged any longer. If you have any reading material on the judges decision on that, I would be happy to be shown to be wrong. You seem to be pretty informed on the matter, so I may be barking up the wrong tree.
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Old 24th Sep 2014, 12:34
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Probably not on their own. I gather there were some shenanigans related to breaking down subassemblies in France so they could be reassembled in the U.S. The avionics and 4-axis autopilot (the first ever certified) were rather expensive.

Anyway, that's what we were told. I flew the HH-65A for a number of years, but I never got a look at the ledgers.

The aircraft specification was based upon the constraint of being able to embark aboard a 210' Medium Endurance Cutter, which was really the tail wagging the dog. That made the upper weight limit under about 10,000# and also constrained the aircraft footprint, which eliminated a number of contenders, including anything with a tail wheel. As I recall, the S-76, B-222, and the AS-365 were the only bidders that had a chance. I started flying it a few years after the first deliveries, so I wasn't around during the bids.

At the end of the day, it was probably the best contender of the three, though the 76 might have given it a run for its money.
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Old 24th Sep 2014, 13:26
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As I recall, the S-76, B-222, and the AS-365 were the only bidders
I'm just going by my recollection of what I read in R&WI but Bell's 214 comes to mind as a competitor. I tried to look up some old archives of Rotor and Wing, but I think I'll have to leave it in the recesses of my mind and go back to sleep.
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Old 24th Sep 2014, 14:04
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Somewhat off-topic, but there was a detailed historical article on the SRR competition in the Coast Guard Aviation Association's internal rag this March: Coast Guard Aviation SRR Program

The 222C (rather than the 214) was the Bell offer, while the S-76 was ultimately no-bid, due to a concern on Sikorsky's part as to whether it would be able to meet both the SRR delivery schedule and a predicted GOM demand spike (which ultimately only appeared years later).

The Bell lawsuit was ultimately decided on the grounds that the 'Buy American' aspect of the award related to the entire HH-65 system purchase, rather than just the aircraft (court findings here and here). For its part, the CG apparently quantified the HH-65's U.S. content at 60%.

Back to the original topic: would AW not have a greater chance of success were it to protest on the grounds of being able to offer an less expensive aircraft that actually met the Army's twin-engine requirement, e.g. the AW109E rather than the AW119Kx?

I/C

Last edited by Ian Corrigible; 24th Sep 2014 at 14:18.
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Old 24th Sep 2014, 14:35
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Not About "Buy America Act" at all......

Since the Army had already purchased a substantial number of these aircraft, it is within the Army's remit, subject to DoD (Executive Branch) approval and Congressional (Legislative Branch) oversight, to repurpose the aircraft.
Seems pretty obvious this whole thing is over the fact that the Army Isn't merely repurposing the UH-72's. Its ACQUIRING an additional 155 aircraft for an additional almost $1B without ever validating a single requirement that the UH-72 can even effectively meet the IERW mission. Completely circumventing any steps in a valid acquisition. Remember, IERW was never a requirement in the LUH program for which the UH-72 was selected. Supporting Centers of Excellence (aka: ground training centers) is not the same as conducting IERW at all.

According to their website, AW's aircraft that they are pushing, AW119Kx are exclusively made in Philadelphia, so "Buy America" would only help AW in this instance, if it was a factor.

Army's twin-engine requirement
IC:
Can anyone show me what the Army's requirements for a new IERW aircraft are?

No, because they NEVER developed them that I have seen, and as of a little more than a year ago the Army said the TH-67s are good and don't need to be replaced.....
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Old 24th Sep 2014, 14:57
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Nice work, I/C!

I/C, thanks for going off-topic and finding that information. I stand corrected. Great research job.
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Old 24th Sep 2014, 15:11
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Keep Army pilots in the Army.......

So here's a thought:

Since the Army can't do full contact autos in the UH-72 (per the Army UH-72 flight manual), Army pilots will no longer qualify for the FAA Comp to get a Priv./Commercial Rotary Wing license. Full contact autos are required maneuver per the FAA.

This may actually have the unintended consequence of keeping Army pilots in the Army. Bad for future CWO's, but good for the Army.
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Old 24th Sep 2014, 15:20
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Stinger,

The Army's position on its go-forward RW training needs (i.e. twin engine/glass cockpit) was well covered in the previous thread that you started.

It's not unusual for Congress to try to dictate the services' requirements (i.e. via budget approvals/reallocation), but it's unusual to see an OEM attempt to do the same thing.

Re: the AW119, the line was for many years destined to be "shifted entirely to India" (Tata), as part of AW's offset obligation on the AW101 VVIP deal. With that program now ended, and the LUH/RSH competition having finally been put out of its misery, it could be that the Koala transfer plan has now been dropped.

I/C
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Old 24th Sep 2014, 16:51
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IC:

The Army's position on its go-forward RW training needs (i.e. twin engine/glass cockpit) was well covered
My point then and remains; not a single requirements document generated by the Army stating their requirements for IERW trainer.


Congress doesn't generate requirements, services do. They can provide oversight when it comes to cost and complexity trade-offs though.....

I agree though, it sounds like AIRBUS is ramming their EC-145 twin engine requirements down the Army's throat a bit. Maybe AB should get some sort of consideration after the Army killed the AAS program they were leading the charge on? $1B worth of consideration maybe

According to AW's own website, the AW119Kx is ONLY built in Philadelphia and the Kx version was specifically developed for the US market. So your previous statement is at a minimum, no longer accurate.
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Old 24th Sep 2014, 17:49
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'Course, if anyone feels as though they're 'owed' any consideration it'll be Bell, after losing both the KW (to the Apache) and the Creek (to the Lakota). Added to which they now face the prospect of hundreds of singles being dumped onto the market just when the 505 is about to appear.

Re: Congress, the HASC and SASC both have a habit of significantly re-writing the DoD's funding request in response to lobbying by OEMs in their local district. Hence the regular inclusion of unrequested funding.

Re: the Koala, the AW119Ke was also ONLY built in Philly. The point made being not that there is a second line (there isn't), but that AW has been considering moving AW119 production to India since 2010. According to this article from July, they are still looking at jointly establishing a line locally with Tata, now focused on the AW119Kx.

I/C
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Old 24th Sep 2014, 18:00
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Didn't Bell just get selected as a finalist for JMR?.......hmmmmm.

Probably why they are only concerned with dumping TH-67s and not lack of competition.

You are right. Looks like AW was doing the same thing Sikorsky has done with the S-92:
Another Tata group company, Tata Advanced Systems Ltd, has a joint venture with Sikorsky Aircraft Corp., a subsidiary of US-based United Technologies Corp., to assemble helicopter cabins in India. The venture was announced in November.
I guess that means that every cabin of the new Presidential Helicopter (VXX) will be built in India......
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Old 24th Sep 2014, 18:21
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Maybe Tata will also get the contract to replace The Beast with something more appropriate for the current economic climate...?



I/C
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Old 24th Sep 2014, 19:26
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IC: well done!
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Old 24th Sep 2014, 22:28
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AW119Kxx

Not forgetting AW proposed the AW119Kxx for the Navy as TH-57 replacement



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