Boeing receives $4 billion multiyear contract for 78 F/A-18 E/F Super Hornet aircraftNews
March 21, 2019
PATUXENT RIVER, Md. U.S. Navy officials signed a multiyear procurement (MYP) contract with Boeing for 78 F/A-18 E/F Super Hornet aircraft that includes 72 aircraft between fiscal years 2019-2021 and six from fiscal year 2018.
The contract calls for the the Block III configuration, which adds capability upgrades that include enhanced network capability, longer range, reduced radar signature, an advanced cockpit system, as well as an enhanced communication system. Boeing will begin converting existing Block II Super Hornets to Block III early in the next decade. The fighter’s life also will be extended from 6,000 hours to 10,000 hours.
Navy officials estimate this multiyear model saves a minimum of $395 million on this contract valued at approximately $4 billion.
“This multiyear purchase is a great illustration of employing team effort to drive out cost and maximize efficiency in government procurement,” said Rear Adm. Shane Gahagan, Program Executive Officer for Tactical Aircraft Programs. “This acquisition strategy secures cost savings to the Navy, and the contract provisions limit Navy liability while incentivizing the cost to the contractor."
There will also be opportunities in fiscal 2020 and fiscal 2021 to procure six more aircraft at the same reduced prices as those in MYP, via a variation in quantity, Navy officials say. The first Block III Super Hornets are expected to be delivered to the U.S. Navy in 2020.
The Fixed Price Incentive (Firm Target) (FPIF) contract limits the Navy’s liability and incentivizes the cost of production for industry. Under this contract, the Navy and its industry partners have agreed to share any monetary overrun or underrun once production is completed.