Boeing (BA)

A key House Republican plans to press Navy leaders this week on the Pentagon's apparent reluctance to enter into a multiyear deal with Boeing for F/A-18 aircraft, arguing that the costs saved are worth the risks of a long-term financial commitment.
Armed Services Seapower Subcommittee ranking member Todd Akin, R-Mo., whose district is near Boeing's defense headquarters in St. Louis, last year succeeded in attaching language to the defense authorization bill that would allow the Navy to pursue a multiyear deal for the F/A-18E/F Super Hornet fighters and E/A-18G Growlers, electronic attack aircraft built with the same airframe. But on Feb. 3, Defense Secretary Robert Gates rejected the idea during testimony before the House Armed Services Committee, stating that the multiyear deal would cut only 6.5 percent off the price of each of the Boeing Co. aircraft -- far less than the 10 percent savings threshold that is customary for such long-term commitments.

Feb 24 · 12:04:00 AM · Source: Government Executive
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by Michael Oliveto