IC,
Millions sound more likely than billions but 8 million won't go far! This article seems to say the lower figure was a typo, or have I got the wrong end of the stick?
How Much Money Did Canceling the VH-71 Save? | Defense Procurement News
Update — The Associated Press and other media corrected this report to say that it was an extension of a contract worth $8.4 million. The total contract value with the extension is over $8 billion. The point stands that there will be a cost associated with keeping the aging systems working while a new system is developed.
One of the programs that was ended as part of the Obama and Gate’s defense reforms was the new Presidential Transport helicopter. Lockheed Martin (LMT) and its Italian partner, Finmeccanica, had won the contract to build a new helicopter to ferry the President around replacing a fleet of venerable VH-3 and VH-60 aircraft made by Sikorsky (UTC). The program had faced cost and schedule issues due to massive requirements creep that caused the total cost to balloon. In 2009 the Navy pulled the plug on the program and started over.
Because a whole new program began it meant that the existing aircraft would need to extend their planned service lives. Some in Congress, especially Congressman Hinchey (D-NY), who represented the area where Lockheed Martin was doing the work on the program argued that this decision could end up being more expensive then continuing the existing program. Lockheed and Finmeccanica did offer a reduced cost program utilizing the aircraft already purchased that could meet some of the requirements but not all of them. One aspect that was raised that there would be a cost related to continuing the use of the older aircraft as they would need to be maintained and modified to stay in use.
Today the Defense Department announced that they were awarding Sikorsky a contract to carry out “VH-3D executive helicopter special progressive aircraft rework induction.” This means money to overhaul and update the current fleet of VH-3 aircraft. The estimated value of this contract is over $8 billion. This is money that is needed because the President’s aircraft must be maintained to the highest standard.
This does illustrate that in some ways Congressman Hinchey was right. The money saved by ending the VH-71 will now go to keeping the older aircraft flying and starting the new program. Eight billion dollars will buy you a great deal of helicopters and capability. Not neccessarily what you wanted in the VH-71 but certainly it would go a long way to meeting the needs of that program.
Penny wise and pound foolish as my Nana use to say.
Read more: How Much Money Did Canceling the VH-71 Save? | Defense Procurement News
Cheers