On 9 July, the Sikorsky Aircraft Corporation confirmed that they have signed another multi-year contract to build a baseline quantity of 653 Black Hawk and Seahawk helicopters for the United States Army and Navy. The contract is valued at between $7.3 billion and $8.5 billion and could eventually reach as high as $11.7 billion.
The contract is a five-year, multi-service agreement designated “Multi-Year Procurement 8 (MYP-VIII) as it represents the eighth multi-year procurement order for the H-60 helicopters signed since 1982. Finalization of the agreement is the result of three years of intense planning and six months of detailed negotiation.
The contract is a price-framework arrangement instead of a fixed schedule order and follows the five-year MYP-VII contract signed in December 2007. The base award calls for the production and delivery of 653 helicopters with deliveries scheduled to begin this month and continue through December 2017.
Aircraft orders will be processed through the US Foreign Military Sales (FMS) program and will include UH-60M helicopters for several allies and MH-60R Seahawk anti-submarine/anti-surface warfare aircraft for the Royal Australian Navy. The five-year contract also allows the Army and the Navy to order as many as 263 additional aircraft under the same terms as the base contract. Should the option for 263 additional helicopters be fully exercised, the contract could be worth as much as $11.7 billion over the five-year life of the agreement.
Actual production quantities are decided on a year-by-year basis subject to funding allocations authorized by Congress and in line with Department of Defense (DoD) procurement needs. While orders are planned five years in advance, budget authorizations can and often do vary from year-to-year, funding will be the final determinant of the volume of orders actually submitted.
From the buyer’s perspective, the attraction of multi-year contracts is significant cost savings coupled with production continuity that serves to stabilize manufacturing capacity and delivery schedules. Buying aircraft batches on a year-by-year schedule tends to increase prices and introduces uncertainty in the production cycle.
The base contract calls for the procurement of UH-60M transport/light cargo Black Hawks and HH-60M Search and Rescue (SAR)/Medevac helicopters for the Army and MH-60R and MH-60S Seahawks for the Navy. Sikorsky will provide the helicopters, technical guidance and assistance, technical publications, on-site training, and upgrades as outlined in the contract.
Some of the Army’s UH-60 helicopters still in service are now over 30 years old and the UH-60 fleet overall has an average age of 23 years. Replacement aircraft are definitely needed and the new helicopters will be a welcome enhancement to the Army’s air fleet.
The US Navy is also in need of new helicopters. The new MH-60S/R aircraft are planned as replacements for the Navy’s SH-60B/F Seahawks, HH-60 SAR models, CH-46D Sea Knights, and HH-1N SAR helicopters. As the United States advances its “pivot” to the Asia-Pacific region, it is likely to believe that the US Navy’s air fleet will be called upon to perform more frequent missions of longer duration given the massive expanse of the Pacific.
All of the contracted Sikorsky helicopters are militarized versions of the S-70, a design that first appeared in the 1972 as a replacement for the venerable UH-1 Huey. The UH-60 entered service with the US Army in 1979 and has compiled an enviable service record both in peacetime and in combat.
