EADS frustrated by U.S. approach to rescue helicopters


EADS could opt out of a long-delayed U.S. Air Force competition to replace its aging fleet of Sikorsky HH-60G Pave Hawk helicopters, unless the Air Force dramatically revamps its rules for the contest, the European company said.

Sean O’Keefe, chief executive of the U.S. unit of Europe’s largest aerospace company, said EADS had told top Air Force and Pentagon officials the Air Force’s draft request for proposals was so narrowly written that it would essentially knock most contenders out of the running.

He said EADS would also consider filing a formal protest with the Government Accountability Office once the Air Force released the final request for proposals in coming weeks, Reuters reports.
“I think there’s a serious doubt whether we’re going to even bother competing for something like this,” O’Keefe told Reuters in an interview at the Farnborough Airshow.

He said EADS has asked the Air Force if it would accept NATO certification in lieu of the requirement for a U.S. certified system, but had not received a definitive response. “They said, submit it and we’ll tell you later. There was no certainty at all about whether there’s comparability there.”

O’Keefe, who served as Pentagon finance chief and Navy Secretary earlier in his career, said the Air Force’s approach to this competition ran counter to the Pentagon’s stated commitment to stimulating competition and reforming acquisition.

Not allowing EADS to submit a bid based on a helicopter that was already in service also flew in the face of calls by U.S. defense officials for industry to spend more of its own money developing new weapons systems, he said.
“In my mind, that’s exactly counter to what the acquisition reform argument is all about. It’s counter to the view that says, let’s find a way to do this less expensively,” he said.

The Air Force in March released a draft request for proposals for the HH-60 replacement program, the latest chapter in its ongoing drive to replace the aging aircraft.

The Air Force selected Boeing Co’s twin-rotor Chinook helicopter for the $15 billion program in 2006, spurring a spate of legal protests and other actions, only to have the Pentagon cancel the program in 2009.

Many executives also wonder how much of a priority the new Air Force program will be if Congress does not find a way to avert $500 billion in additional budget cuts on top of $487 billion in cuts already being implemented.

The Air Force is due to release the final request for proposals in coming weeks, but one defense industry executive said the release could be delayed until later this fall or winter, after Congress deals with the issue of the additional budget cuts.

O’Keefe said he was also frustrated by the Air Force’s decision to put off replacing its fleet of helicopters that secure nuclear missile sites and extend the life of its aging fleet of UH-1 helicopters.

EADS had hoped to bid for the order using the same helicopter it now builds for the U.S. Army, arguing that buying new aircraft would cost about the same as the extensive work needed to extend the life of the existing ones.
“The frustration of working through some of this is what motivated me to be much more vocal,” he said.

EADS has thus far been thwarted in its drive to dramatically expand in the U.S. market, first losing a $35 billion refueling plane contract to Boeing Co and then watching the acquisition programs it was pursuing repeatedly get deferred.