Fallout Assessment Still Underway From LockMart's VXX Win

Aviation Week & Space Technology 02/07/05
author: Robert Wall
author: Andy Nativi

Sea Change

The Pentagon's decision in favor of the Lockheed Martin-led US101 team to develop the U.S. presidential helicopter is being seen as a watershed event, although experts are divided over the larger ramifications of the $6.1-billion deal.

To some, the order for the U.S.-primed, AgustaWestland-designed helicopter could signal a shift to a more favorable Defense Dept. procurement policy concerning foreign hardware, while others fear a backlash in Congress that could close the U.S. market to overseas suppliers. Moreover, others speculate the award prejudges the looming 120-plus helicopter U.S. Personnel Recovery Vehicle (PRV) competition.

The presidential helicopter (VXX) decision marks the second time in only a few months the Pentagon has opted for a Lockheed Martin-led team whose system is built around a major foreign airframe; the other program is the Army's Aerial Common Sensor, which uses the Embraer EMB-145. The VXX teaming in particular is the type of transatlantic industrial arrangement the U.S. has been trying to foster, argues Steven C. Grundman, director of aerospace consulting at Charles River Associates and a former Pentagon official involved in transatlantic cooperation during the Clinton administration.

But others fear the VXX announcement could backfire. Congressional supporters of losing-bidder Sikorsky are vocal about their displeasure of the outcome. Lawmakers from Connecticut, where Sikorsky is based, and House Armed Services Committee Chairman Duncan Hunter (R-Calif.), a staunch "Buy America" advocate, groused about the decision.

One senior industry official warns it could galvanize protectionist sentiments in Congress. The VXX decision, paired with the anticipated European Union's lifting of its arms embargo on China, is likely to generate a huge backlash among legislators and could stall other initiatives, such as granting the U.K. a waiver from some U.S. technology transfer restrictions.

One of the most immediate questions, however, is what the VXX implies for the Air Force PRV program. "The order is a ringing endorsement of the aircraft and puts it into a very strong position for the U.S. PRV, which could be up to 200 helicopters and worth up to $6 billion," notes a Merrill Lynch analysis. Sikorsky officials, prior to the decision, also argued there is a clear link. Others contend Sikorsky is a shoo-in because the Pentagon wouldn't dare threaten the company's future by denying it PRV as well. Also expected to compete are a Northrop Grumman/ EADS team with the NH90 and Bell-Boeing with the V-22 tiltrotor.

Navy acquisition chief John Young tried to dispel the notion of a link. The VXX "requirements are not likely to be duplicated elsewhere," he argues. "This is a fairly unique opportunity." He adds that the Navy and Air Force discussed marrying the programs, but decided the requirements differences were too great.

Reality seems to be somewhat different, though. There are significant performance similarities between the two efforts. For instance, the eventual presidential helicopter would have a 350-naut.-mi. range; the Air Force special ops community also has a demanding range requirement, with a 325-naut.-mi. minimum. Moreover, the special ops forces want extensive and sophisticated communications tools, which are being integrated on the presidential US101.