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Boeing, US Army make multibillion, multiyear AH-64E deal official

March 22, 2017 (Photo Credit: Sgt. Harley Jelis/New York National Guard)
WASHINGTON — The U.S. Army and Boeing signed on the dotted line for the first multiyear AH-64E Apache attack helicopter contract — a deal that’s been years in the making — in a signing ceremony in Mesa, Arizona, on Wednesday.

Under the base contract worth $3.4 billion, Boeing will deliver to the Army 244 remanufactured AH-64Es. The multiyear deal also includes 24 new-build Apache Echo models for Saudi Arabia.

The Middle Eastern country is also buying AH-6i helicopters from Boeing as it works to modernize the Saudi Arabian National Guard.

While UH-60 Black Hawk and CH-47 Chinook programs have long enjoyed the stability and savings generated from multiyear contracts, the Apache program has functioned using individual contracts up until now.

The Army expects to yield about 10 percent in savings through the five-year contract and will deliver — as a minimum baseline — 52 aircraft in 2017 and 48 in the remaining years, Col. Joe Hoecherl, the service’s Apache attack helicopter program manager, told reporters via teleconference at a media roundtable Wednesday just before signing the contract in Mesa.

However, the contract allows for options to be exercised for Boeing to produce up to 450 aircraft either for the Army or for other countries to purchase through foreign military sales.

Should all of those options be exercised, the full, multiyear deal could be worth more than $7 billion. And the savings could also increase. But Hoecherl said it wouldn’t be possible, with so many unknowns, to calculate exactly how much more the Army could save should those options turn into real orders.

Given the fact Boeing has provided Apaches to 15 countries worldwide, there are strong possibilities countries with older variants of the helicopter or countries looking to become new customers are going to be ready to jump on board, Kim Smith, Boeing’s vice president for attack helicopter programs, told reporters in the same teleconference.

A multiyear deal will make it easier and faster for foreign customers to buy Apache helos, Smith said.

While neither the Army nor Boeing would reveal when or what countries might be interested in purchasing AH-64Es through the multiyear contract, both Hoecherl and Smith said there is a lot of interest on the international market for the helicopter and production can easily be ramped up to accommodate the orders.

Boeing has already delivered to the Army 181 AH-64E helicopters since 2011, which translates to more than five battalions, Hoecherl said.

The E-model comes with improvements over the Delta-model like composite main rotor blades, the capability to control unmanned aircraft systems from the cockpit, improved targeting and night vision systems, and greater speed and range.

Since 2013, the Apache helicopter — paired with the Shadow UAS — has also taken on an additional mission set in the Army to fill a gap left open when the service decided to retire its OH-58 Kiowa Warrior armed reconnaissance helicopters.

Ultimately, the Army plans to procure 690 Apache E-models.
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