Pentagon agrees to new multiyear contract for Boeing Super Hornet jets

The Pentagon has agreed to enter a new multiyear contract for Super Hornet fighter jets, handing Boeing and its congressional supporters a long-sought victory.

Ashton Carter, the Pentagon’s acquisitions chief, and Robert Hale, the Pentagon’s comptroller, on Friday informed congressional leaders that they are preparing to award a multiyear contract to Boeing for 124 Super Hornet fighter jets and their electronic attack versions, the Growlers. The contract would run from no later than Sept. 30, 2010, through 2013.

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By entering a longer-term contract, the Pentagon projects it would save $590 million, or 10 percent, compared to buying the planes as part of annual contracts. Carter and Hale called the savings “substantial.”

Boeing and its congressional supporters have been pressing for a long-term contract for several years. Recent negotiations with Boeing have taken place at the highest level at the Pentagon, where officials sought to squeeze the best price and savings out of Boeing for the Navy and Marine Corps fighter jets.

The Navy already had congressional authorization for a multiyear contract in the fiscal 2010 Defense Authorization Act. Rep. Todd Akin (R-Mo.), one of the lawmakers who spearheaded the efforts to facilitate another multiyear contract for Boeing, on Friday hailed the decision, which the Pentagon had delayed for several months. Boeing builds the planes in Akin’s district.

“I commend Secretary [of Defense Robert] Gates and Secretary [of the Navy Ray] Mabus for seeing the light and moving forward with a multiyear contract,” Akin said in a statement. “It is encouraging to see the Navy and DoD come to their senses on this issue, after I have spent two years arguing that a multiyear contract made sense on all fronts.”

Lawmakers have also aimed to stave off a shortfall of fighter jets on the decks of the Navy’s carriers. The shortfall, expected to peak in 2016-2017, has been a matter of debate between Congress and the Pentagon for several years.

That debate is fresh on lawmakers’ minds. Pentagon leaders recently restructured the F-35 Joint Strike Fighter program that would build next-generation fighters for the Navy, Marine Corps and Air Force. Lawmakers fear this could lead to delays in the delivery of the F-35 to the Navy and Marine Corps.

The F-35 is supposed to replace the older versions of the F-18. Super Hornets, the newest version of the F-18, are supposed to share carrier deck space with the F-35 until 2030.

Gates and other Pentagon officials, including the chairman of the Joint Chiefs of Staff, Adm. Mike Mullen, are standing strongly by the F-35 as the next-generation fighter aircraft.

Apart from being concerned about the fighter jet shortfalls, Boeing’s supporters also fear that without extended domestic contracts Boeing could be entirely shut out of the fighter jet market, since Lockheed Martin is building the next-generation fighter jet. The new multiyear contract will also be a hedge for Boeing until it receives enough international orders for the plane to keep its production line going.