A panel of senior Department of Defense (DOD) officials will meet on 2 October to decide whether to cancel the Boeing avionics modernization programme (AMP) for most Lockheed Martin C-130Hs despite having nearly completed an eight-year, $1.4 billion development phase.
AMP's survival will be decided by the deputy's advisory working group (DAWG), co-chaired by deputy secretary of defence William Lynn and vice chairman of the Joint Chiefs of Staff Gen James Cartwright.
The DAWG meeting comes less than three weeks after the US Air Force proposed to terminate the programme to save money. The USAF requested about $210 million for AMP in Fiscal 2010, which began on 1 October.
Lynn's panel has several options. The group could follow the USAF's recommendation and cancel the programme. Alternatively, the DOD could reject the USAF's proposal and authorize AMP to enter low-rate initial production, as planned.
The group also could adopt some type of compromise agreement to continue the programme at a lower cost. Such a compromise could likely include stripping off minor features of the AMP system or shaving one of three principal variants of the C-130H off the programme, says Mike Harris, Boeing vice president of weapon systems modernization programmes.
The USAF launched the AMP programme for two reasons. The upgrade will bring most of the C-130H fleet into compliance with a future standard for operating aircraft at civil airports. The C-130 AMP suite also provides a standard cockpit layout and core avionics package for three C-130H Models - 2.0, 2.5 and 3.0.
The AMP programme has endured a bumpy history. A major cost overrun in 2005 triggered a mandatory review by the Office of Secretary Defense, which decided to recertify and restructure the programme.
The restructuring moved 166 C-130s operated by both regular and special operations forces out of the programme, leaving Boeing with an order to deliver AMP kits for a total of 221 C-130H2s, H2.5s and H3s.
Due to both the cost overrun and a smaller production base, the per unit price for the installed AMP kits soared. Boeing has committed to reducing the price tag from $12.3 million in 2007 dollars today to $7 million when full-rate production begins in five years, Harris says, adding the company is on track to do so. The company has shed 40% of the white collar engineers on the programme to save costs.
The termination threat arrives even as the eight-year development phase approaches its last few weeks. Harris emphasizes that the C-130H AMP programme has been delivered under budget and on schedule since the 2005 cost overrun. If the programme is terminated, the USAF will gain nothing from its $1.4 billion investment to fully develop the software for three C-130H variants.
Source: Flight International
