Navy P-8 Deal Tops $17 Billion in July Awards

Navy P-8 Deal Tops $17 Billion in July Awards

Boeing Co. won the U.S. Defense Department’s biggest contract last month, a $2 billion award for more P-8 Poseidon surveillance planes.

Under the agreement, the Navy will buy 13 P-8A aircraft as part of another round of low-rate initial production, according to the July 31 announcement. The deal also includes equipment kits, as well as parts and manufacturing materials associated with the next planned purchase of planes.

The award topped a list of more than 240 contracts with a combined value of about $17 billion in July, according to a Military​.com analysis of the Pentagon’s daily contract announcements. The overall value fell by more than half from the prior month, as the military disclosed far fewer orders worth more than $1 billion. The amounts don’t reflect what was actually spent, or obligated, because many deals are only partially funded at first.

“We’re on budget and on schedule and the Navy will stand up initial operational capability of this transformational aircraft by the end of the year,” Rick Heerdt, a vice president at Chicago-based Boeing and the company’s P-8 program manager, said in a statement after the contract announcement.

The P-8 is based on the company’s commercial 737–800 twin-engine narrow-body passenger jet. In fact, both aircraft are made in the same facility in Seattle. The naval plane is designed to replace the P-3C Orion made by Bethesda, Md.-based Lockheed Martin Corp, in conducting long-range missions to hunt submarines, among other ships, and collect intelligence, according to the Navy.

The Navy’s decision to buy the P-8s under low-rate initial production follows a recommendation from the Pentagon’s inspector general’s office, which had warned that more “critical testing” of the submarine-hunting plane was needed before advancing to full-rate production.

Buying the planes “based on incomplete test results could result in costly retrofits to meet lifespan and mission and system performance requirements,” according to the summary of an audit released in June on the website of the Defense Department’s Office of Inspector General.

The IG office recommended that Frank Kendall, the Pentagon’s top weapons buyer, purchase the aircraft under a contract for low-rate production and delay the full-rate production decision until Capt. Scott Dillon, the Navy’s program manager for maritime surveillance aircraft, can demonstrate the plane will be able to survive its 25-year lifespan without structural fatigue, overcome mission-limited deficiencies, and track surface ships and perform other primary missions.

While the Navy ultimately followed the counsel of the Pentagon’s inspector general’s office, company officials dismissed the audit.

“I wouldn’t read anything into that,” Chris Raymond, vice president of business development and strategy for Boeing’s Defense, Space and Security unit, said during a June 16 briefing with reporters at the company’s Paris offices before the start of the Paris Air Show. “Between us and the Navy, we still feel like we’re very on track with the flight test program. It’s going well.”

Boeing is delivering planes and a pilot training program is underway at Naval Air Station Jacksonville, Fla., Raymond said.

Still, the amount of testing that remains to be done could be significant. The Navy is rumored to have wasted time and money duplicating efforts made by Boeing measuring the aircraft’s flight performance. The service has yet to verify the full functionality of the plane’s various sensors, among other technology.

The overall cost to develop and build a total of 122 of the aircraft, including five test versions and 117 production models, is estimated at $34.9 billion, according to figures the Pentagon released in May.

The Navy to date has ordered 37 of the 117 production models it plans to buy, according to the Boeing statement. So far, 10 have been delivered, according to the company.

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Good. This seams to be one of the few defense projects that’s on budget, on spec and on time. I hope the UK buys a dozen as well. India will up theirs to a about two dozen also. Good job by Boeing, and good for the workers in WA State, who through incompetent management at Boeing Commercial have been pummeled for decades now. A silver lining it is. Quite a formidable force the USN will have with 117 of these airplanes.

On budget, for which I give them much credit. Almost on schedule; they’ve slipped a year or two from the original plan — but that’s almost miraculously good, given how unrealistic most defense program schedules are.

I can’t concede “on spec” though. Last year’s DOTE report had a full page of performance shortfalls, some of which were pretty significant — sensor performance, unreliable comms, deferred requirements for wide-area acoustic search, etc. Again, that’s SOP for major defense programs these days, but let’s not go overboard in our praise — this is NOT a case where the program delivered the promised capability at the promised cost in the promised time. (And the costs are still forecasts, not actuals…)

I wasn’t really educated on this program it shows. I find it saddening, even though this program isn’t a fiasco like the f-35 or the lcs ships etc. But guys, this is a f’ing airplane that’s been airborne since the 60’s, it’s only mission systems that need to be installed, no major aerodynamic things. How can it be SO difficult. I really have to blame the lack of engineering skills. With all major US companies. You fire them all, upping profit margins, but cutting of your own legs while allegedly competing at a marathon. Guess what, not many marathon winners without legs.

The engineering culture needs to proliferate in America. It might start now with the auto industry, but it needs to spread. Take a page form the Germans. Pride in manufacturing excellence.

I’m still positive about the p-8 and it’s export succes. Let’s hope the kc-46 does ‘as well’ also. Meaning it shouldn’t be a 787 like fiasco. Here’s to that happening cheers.

Its easy if you don’t bother testing. On spec? — LOL.

This is laughable.

The whole point of the P-8 is that it funnels money to the contractor. Some of it is then used to buy the jobs that the congressmen need to get re-elected. Design and engineering are not only wastes of money they are irrelevant. That’s why production has to be rushed into — to create the jobs and secure the production contracts otherwise the whole thing doesn’t work.

Would anyone in their right mind use an obsolete airliner designed to operate at 30,000 feet as a maritime patrol aircraft that will fly at 2000 ? unless it was to keep a paid off production line open and keep the jobs going ?

The obsolescence of the 737 is only kept from being reality because there is a duopoly. Airbus v Boeing is THE single biggest tangible evidence of everything wrong with American business ethics. Us Europeans keep designing and building new product, making our older product obsolete. You guys keep putting lipstick on old designs. Boeing had 90% of the world’s aerospace engineers (figuratively) back then, they could have made planes that carried an entire division of soldiers (hyperbole). Instead they fired their engineers, and now they have difficulty even applying that lipstick (777x, 737 max, kc-46). Pathetic. When a country used 30 year old platforms as police cars (crown vic) that pretty much cements it.


PS: I think the government should at least partially nationalize many of the defense contractors. Their culture has become thievery and robbery of the tax payer, instead of best bang for the buck and producing actual truth.

Well we will some some P-8s show up. But with BIG cuts here and BIGGER one coming I think we will see P-3s for much longer.

The primacy of aerospace engineers is over, the future belongs to electrical engineers. Overpriced avionics, IRST, DAS, new seekers for old missiles…

The “Concerned European’s” comments, he sounds much more like a “Concerned Simple Minded

Using a jet for the ASW mission was a bad idea in the first place, unless it has Jet Assist or Rocket Assist
(JATO/RATO) packs to keep it out of the water at very low altitude required for the ASW Missions.

The P-3 Orion is a Turboprop driven aircraft. You can keep it’s turbines “Spooked Up” and use the
variable-pitch props while operating near the water,so you can instantly climb if it is necessary to
avoid adverse meteorological situation ions, Ie.Wind Shear such as happened with the DELTA
Lockheed L1011 in Dallsa, Texas, USA and surface vessels.…..

A pure jet engine does not react fast enough to avoid a disaster under these circumstances.

I especially hate direct such harsh critical words towards someone from Europe as I have always
admired their technical brilliance and treasured their insight.

My sincere apologies.

Thanks for the info. Sincerely, I don’t know much about aerodynamics, and which plane is suited for what role. I was merely pointing out that the p-8 at least seemed to be an American defense project that was seemingly going well. After all, pretty much anything you guys designed after the early 80’s is a complete fiasco (save the c-17 etc).

Perhaps the US government even know no American company can design a ground up turboprop? And would rather spend it’s money home, even if the ‘warfighter’ gets a bit inferior product? You could buy countless superior Eurpean designs (ATR, CASA C295, perhaps even a a400m version later on. We’d love to sell. I personally would love for America to be able to design things. So get on it.

Have you ever heard of Pratt and Whitney Canada, building the best Turboprops on the planet right now.
You Europeans should have bought their engine to power your A-400 instead of that piece of crap that currently powers it. But alas you have the same narrow minded approach “buy European” to keep your citizens employed instead of purchasing the best product.

I meant to say turboprop AIRCRAFT. Yes, I know PW Canada, selecting that engine would have indeed shaved at least a year off the a400 schedule. However, the TP400 is the world’s most modern and efficient turboprop now.

But indeed, I meant to say aircraft. Where are the modern US turboprop aircraft?

There is no victory here for the IG. Labeling the next year’s purchase as another LRIP (Low Rate Initial Production) is nonsense when you already exceeded the 10% threshold meant to keep the program in check until testing and manufacturing problems were resolved. So, this is really just the typical program schedule stretch to keep the program going and the profits flowing. What DoD should have done is stop production until ALL testing issues were resolved and retested. With the commercial line keeping Boeing going, there’d really be no negative cost impact to the government. And if Boeing claimed there would be they’d be lying.

There is no point to nationalizing Boeing or any other defense contractor. We still have research divisions of all the military service branches. They were fine to design weapons before the defense contractors took over, they could do the same thing again. Back when the US Navy designed its own ships, they could design and build the Iowa Class battleships for less than it now costs to design and build a little crappy ship (LCS). Contractors are fine for supplying hourly labor, but should never be engaged for engineering or other non-hourly services.

to all do you realize the P-8 is just a change in the package provided in the late 1980’s which was called the p-7 this project is over 30 years old and still has amjor questions. Oh by the way the P-7 was scapped because Lockheed Martin had a better product but a turbo prop and the flyboys wanted a jet so what do we get the 737 with new avionics. just like the p-7 competition

don’t worry as they won’t have anybody on the ground to put a chock under it the way they want to cut pay and benny’s for enlisted.

Great, as long as ENGINEERS are primary people. Not bean counters, or burger flippers, or those disgusting wall street ‘money movers’. Making things gets my respect. They are ‘makers’. Wall streeters are ‘takers’. Always remember that. See what happened to the UK. They are nothing now. Look at Germany, they are everything. You should want to be Germany.

True. Or at the very least: strict oversight. Like us in Europe. I mean look, I am a capitalist, not a communist or extreme socialist. But no holds barred capitalism is just as destructive as both aformentioned things. Greed is a human ingredient, look at thousands of years of philosophy. It’s inherent of our nature. I am a greedy CEO with greedy shareholders and a gigantic pool of taxpayer money. I try to leech every bit of it. Which is why you nationalize somethings. Like defense, or what you said indeed. Bet they will cry socialism then. Disgusting.

Government is good to work at when productive. Those guys at DARPA are government engineers. I don’t hear any bad about them. Hire thousands more I’d say!

DARPA is great, but it’s not their job to build production-ready stuff. As their name states, they do advanced research and try to prove what is possible and hand that off to someone else to actually build it in quantity (usually several years later).

There is no capitalism at all in the US procurement system. Back when there was capitalism, we had the best Air Force without question. In those days the contractor funded their own aircraft development and the US government bought the best plane for the best price. The Navy went the other way. Ships are too big and cost too much for private development, so the Navy designed its own ships. The US has split into 2 rhetorical camps, the Republicans all shout, “capitalism, capitalism” but don’t know what the hell capitalism is, and the Democrats all shout “communism, communism” but typically end settling for some form of fas cism (the government picks the winners and losers from the private sector) much like they did with Obama care. Both sides are so busy f’ing over the US taxpayer that they have little time for reality. Our founding fathers, on the other hand, were pragmatic and were for whatever works. Capitalism in its place, socialism when capitalism won’t work.

Perfect. Where did you go wrong. I bet after Eisenhower. At least when it comes to defense questions. Damn you should cut that in half. That’ll make the contractors scream and actually do something to survive. Pretty pathetic that Lockheed ‘branched out’ to healthcare and IT services. COMPLETELY none of their business. If they retained all that talent (look at all the unimaginable stuff skunk works made over the years), they could easily build the best fighter in the world and export countless of copies. That would make it a strong, stand alone company. Not a 50 year old man still seeking mothers breast.

With new sensor technology you might not have to cruise at 2000ft. to find a sub. Higher up more area covered. And if Airbus is any indication of European engineering competence…thank goodness for US engineers. As for turbo engines…don’t helos you turbos? How about 1M1A battle tank, Burke Class Destroyers, on and on the list goes. I thing the V22 uses Rolls Royce…Remember during WW2 the Germans over engineered most of their high tech gear. There seems to be a contininum of technology. vs. Let’s say Germans on one end and Russians on the other. The US uses technology, proven technology, and is some where closer to the Germans than the Russians. Production is the key. Who can beat us? We have some BIG mistakes LCS’s, Maybe F35 (A/C), and other projects. I do agree with the comments is would be in our best interest to go back to BUSHIPS designing USN ships and to have defense contractors to build prototypes with there own money. Ike warned us and we did not heed his warning…MMCS(SW)(SS) UNS Fet.

Wait, In July the NAVY & DoD send 640,000 civilians home on furlough because they can’t afford pay but then dole out a 17 Billion dollar contract and don’t announce it till after the furlough is near it’s end. Sounds like someone was afraid of the back lash. Add that to the 51 Billion the Army contracted out the same day furloughs started to upgrade computers. Again, couldn’t this wait a year? No, it’s easier to screw your people so you can have a nice bullet on your appraisals and get new toys.

Airbus is the number 1 in the world in aerospace engineering. Not to brag about Europeans, I am a Boeing fact, but facts are facts. Airbus instead of outrsourcing their mother, spent money on her. Meaning we now have a huge army of highly skilled engineers, where Boeing sent theirs packing, so I call for those WASP CEO’s to be hung. Anyway, I don’t EVER doubt the will and skill of the American people, it’s those 1%er CEO’s who destroy your country, leaving the little guy arguing about what went wrong, and whether gays should get married. The theft happens behind the curtains.

I’d much rather have a government who sees these sectors as ‘jobs programs’, than a government who allows a few rich sleazebags to oursource everything, so they can buy a 53rd yacht. Kill them.

As a person making arms length observations at the abstract and strategic level I cannot find much to argue over as Concerned European made his observations.

I have listened to the arrogant pronouncements of Europeans concerning what is wrong with The United States for five adult decades now .… particularly from the mouths of Brits in an ex-pat situation .… and this person does not fit that bill.

He/she sounds sincerely wistful for the performance of The United States of the past and concerned for our future in a constructive way.

A little criticism from a friend can be a good thing.

THE RAF’s experience with the Nimrod would be a strong argument against your claim.

Furloughs are a joke sort of the LRIP of jobs. They should just fire the people — its not like the money hasn’t been promised to the contractors already.

Someone made a good case why we need to keep on funding the contractors — even as they deliver less at an higher price. That is the experience of Boeing.

When Boeing absorbed mcdonnell douglas a lot of those contractors ended up working on the 787. That is why the 787 is an over– hyped bug ridden mess — much like the normal military project. If mcdonnell douglas had been bailed out by the government its toxic workforce wouldn’t have been able to contaminate Boeing’s airliner division.

Boeing will be increasingly uncompetitive dependent on military contracts to keep it alive and die the same way Douglas Aircraft died.

Lockheed makes money in health care and IT services in the same way it makes money in defense. The procurement rules are the same regardless of what it is the federal government buys. So if they pay for the development of new software, guess what happens? If you guessed that the development drags out while the contractor has one huge problem after another, then you’ve figured out the scam. If they’re providing people to staff a hospital, then they staff it with the worst, least qualified people they can get, paying them as little as possible. This way they maximize their profit and when their barely qualified people can’t get the job done, they use that as justification for hiring more barely qualified, poorly motivated people. It’s a pattern that’s repeated over and over again.

Mostly this all started with Regan (who I voted for twice — not like there was much of a choice). He’s the one that pitched the wonders of outsourcing government. Nothing in the history of this nation has gone so wrong.

No, it’s not the American worker who f’ed up the 787. Lay that failure on their foreign outsourcing “partners”. They are the ones who screwed that program into the ground. It turns out that if you can design a washing machine it isn’t the same as designing an airplane part. Of course, on the up side, it was a great excuse to give China the technology that went into producing the B-2 airplane (http://​seattletimes​.com/​h​t​m​l​/​b​o​e​i​n​g​a​e​r​o​s​p​a​c​e​/​2​0​0​2​7​5​4​2​2​4​_​b​o​e​i​n​g​i​t​a​r​2​2​.​h​tml).

C-130J has crapped to trash a400,which is a rubbish of European subsidy with delay like airbus style

Mr. Elmer,
I have 5500+ hours over 9 years flying the 737–800, I am currently an Airline Captain on it, and am Retired from the USAFR.

No one flies a jet at idle power, 2000′ feet over the deck. The “spool up time” of the current variant of the GE/SNECMA CFM 56-27B, the likely engine choice for the P-8, is a far cry from the RB211 on the L-1011 TriStar.

In fact. The EEC ( Electronic Engine Control) limits the engines’ idle N2 compressor speed based on aircraft altitude, configuration, whether anti ice was selected in flight, and limits inflight Idle power to 59% N2.
Not an issue!


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