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 The St. Louis production line for Boeing's F/A-18E/F Super Hornets
and EA-18G Growlers is slated to shut down after 2016 unless the
Pentagon's No. 2 supplier wins additional U.S. or foreign orders for
the planes soon. The plant will build F-15 fighters through at least
2018, based on current orders.
U.S. Navy officials often laud the performance, on-time deliveries,
and low operating cost of the Super Hornet and Growler aircraft,
which fly from U.S. aircraft carriers.
But U.S. defense officials say the Pentagon's 2015 budget will not
fund any more of the Boeing planes given competing budget demands
and a growing focus on Lockheed Martin Corp's next-generation F-35
fighter, which has three models, including a carrier-based model for
the Navy.
Boeing executives acknowledge the tough budget environment, but say
detailed studies under way by the U.S. military reveal a need for
more electronic attack aircraft given work by potential adversaries
on new radar systems that could detect F-22 fighters and other
stealthy planes like the F-35.
The EA-18G Growlers fly into battle with other warplanes, jamming,
confusing and disrupting enemy radars. Other aircraft have some
electronic capabilities, but Boeing says the Growler is the only
plane that addresses the full spectrum of threats.
"Boeing is looking for creative ways to partner with the Navy,
including lowering the rate to two aircraft per month, to keep the
line running past 2016," Mike Gibbons, vice president of F/A-18 and
EA-18 programs, said in a telephone interview late on Friday.
Restarting the line later would be costly.
The company already plans to slow production to three jets a month
from four, but scaling it back further to two jets could extend the
production line through mid-2017, without substantially raising the
price, he said.
"We want to keep the opportunity open so that Congress can act," he
said. "It's pretty clear that there's an emerging realization of the
need for more Growlers ... not just for the Navy, but the Air Force
and the Marines."
He said the Navy and the Pentagon's Cost Assessment and Program
Evaluation office were "very seriously" studying the need for more
electronic attack capability, and Boeing could eventually land 50 to
100 more Growler orders.
Even though a possible shutdown is still years away, Boeing must
decide within a month whether to use its own funds to keep certain
suppliers producing titanium and other items that take longer to
produce, or to start shutting down the line.
Congress added $75 million in "long lead funding" for 22 more
Growlers to the Pentagon's fiscal 2014 defense budget, but the Navy
has not yet released those funds.
Gibbons said the Navy had shown a "very strong willingness" to
accept slower delivery of jets if that kept the line running beyond
2016, but no decisions had been made. If agreed, the slower build
rate could be factored into a multibillion dollar contract for 47
jets that Gibbons said he expected to finish negotiating with the
Navy over the next month or two.
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Some U.S. lawmakers worry about ending the Boeing production line in
2016, three years before the Navy is due to start using its F-35
jets in combat, especially given continued issues with the
development of software that the F-35 fighter needs to be able to
operate certain key weapons.
Representative Randy Forbes, a member of the House Armed Services
Committee, told Reuters he is pressing the Navy to explain its
reasoning for shutting the line. "I'm really concerned," he said.
"If we need them later, you can't rebuild all that production
capacity."
Pentagon officials argue that the $392 billion F-35 program is
making progress after years of delays and cost overruns. They say
the new jet's electronic warfare and data fusion technology will be
vital to fight future potential adversaries.
Deputy Chief of Naval Operations Vice Admiral Joseph Mulloy last
week said the Navy remained committed to the F-35 program, and had
no plans to extend the Super Hornet/Growler line.
But others say the Navy remains skeptical about the carrier variant
of the F-35, which is due to start sea trials this summer. The Navy
plans to defer orders for four F-35s in fiscal 2015, and a total of
33 jets over the five-year planning period that runs through fiscal
2019, said one source familiar with the plans.
Congressional aides say lawmakers may be hard-pressed to fund extra
Growlers given competing demands at a time when the Pentagon is
targeting military pay and other systems.
Gibbons said budget pressures strengthened Boeing's push for more
Growlers since the jet offered what he called an "incredibly
affordable and agile weapons system for the future."
The company says it also sees possible orders from two buyers in the
Middle East, which plan to decide by the end of 2014, as well as
Canada, Denmark and Malaysia.
Canada helped fund the development of the F-35 and had planned to
buy the plane, but is now considering a fresh competition given
problems with the initial F-35 selection. Denmark is launching a
competition this year.
Richard Aboulafia, analyst with the Virginia-based Teal Group, said
moves to slow production of the jets could help extend the line for
a while, but he was skeptical about the likelihood of more foreign
orders.
"They've been on the international campaign trail for 20 years and
there's been exactly one customer -- Australia. There just isn't a
lot of demand for heavier twin-engine fighters."
(Reporting by Andrea Shalal; Editing by Rosalind Russell)
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