Sierra Nevada and its major partner have been awarded a firm-fixed price contract for $355.1 million for the U.S. Air Force’s Light Air Support (LAS) aircraft program; but competitor indicated it will continue to fight the move in court.
Hawker, theand Sierra and Embraer variously announced the award Dec. 30, including dueling press statements between the prime competitors over what could become a federal court case regarding contract procedures, the fate of Hawker Beechcraft and the future of U.S. efforts to train allied air force pilots, starting in Afghanistan.
According to a Pentagon announcement, issued after regular trading closed on U.S. stock markets, the five-year award is for 20 “non-developmental aircraft procured for conducting advanced flight training, surveillance, air interdiction and close air support.”
As described by the contract announcement, “The LAS aircraft is a single-engine turboprop fixed-wing aircraft with tricycle, retractable landing gear, and tandem two-place pressurized cockpit with ejection seats, capable of operating from semi-prepared air fields.”
The Hawker AT-6 and Embraer Super Tucano were evaluated by the Air Force in a flyoff conducted in January 2011. Sierra is the A-29 Super Tucano’s U.S. lead in the LAS competition, and final preparation will occur in Jacksonville, Fla. In a press statement Sierra and Embraer executives hailed their win.
““We are ready to support the LAS mission immediately,” said Luiz Carlos Aguiar, President Embraer Defense and Security. “This is a tremendous opportunity for Embraer, the citizens of Florida and the thousands of employees who will be part of our supply chain.”
“We are honored by this decision and the opportunity to serve our country,” said Vice President of ISR Business Development Taco Gilbert. “We believe in the goals of the Light Air Support mission and are proud to be able to support the United States in its partner-building efforts in Afghanistan and elsewhere around the world. American warfighters, American workers, and our partner nations all win with this award.”
Embraer will provide the A-29 Super Tucano aircraft, simulators and planning stations, and spare parts. Sierra will provide in-field logistic support and pilot and maintenance training. The companies said more than 70 U.S. suppliers in 21 states will supply parts or services, and at least 1,200 U.S. jobs will be supported through this contract.
Earlier in the day, Hawker said the firm had learned from Justice Department attorneys at a U.S. Court of Federal Claims hearing that the Air Force apparently awarded its Light Air Support (LAS) aircraft contract to Sierra Nevada and Brazilian airframe manufacturer Embraer on Dec. 22.
Furthermore, as of early Dec. 30 government officials apparently had elected not to make public the contract award, although Dec. 28 court transcripts confirmed the fact, according to Hawker.
The lag prompted Bill Boisture, Hawker chairman and CEO, to say, “This is yet another example of the Air Force’s lack of transparency throughout this competition.” Hawker filed suit with the Court because it was declined a review of why it was disqualified from the LAS competition. “With this development, it now seems even clearer that the Air Force intended to award the contract to Embraer from early in this process.”
Hawker’s AT-6 LAS bid, a beefed up and more powerful version of its T-6 Texan II trainer, faced stiff competition from the Embraer EMB-314 Super Tucano fielded through Sierra, during the LAS competition. The AT-6 is a newcomer to counterinsurgency warfare and the LAS program would have been its first opportunity for combat experience. Super Tucano, in contrast, has been on active duty for several years with the armed forces of Brazil and Colombia, among other nations, and it is a veteran LAS combat aircraft.
As Aviation Week & Space Technology reports in its Jan. 2, 2012, edition, the outcome of the legal battle could directly affect Hawker’s future. Despite the profits from military sales, the company has posted cumulative operating losses of nearly $1 billion since 2009, and its core market of business jets is not expected to rebound significantly until at least 2013. And unlike other business jet manufacturers such as, which is owned by , and Gulfstream, a unit of , Hawker does not have the backstop of a large corporate parent. Investment bank Goldman Sachs and Canadian buyout firm Onex Corp. purchased Hawker in 2007 from for $3.3 billion.
In recent months, there has been widespread speculation that the company’s owners could try to recoup part of that investment by selling off some or all of its operations in pieces, with the military segment going to a U.S. buyer and the civil aircraft unit sold to an entity in China, which is trying to become a player in the business and general aviation market. But if the company does not win the LAS competition, its military line would be less attractive.
- with Joseph C. Anselmo in Washington