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Boeing wants more $ 3.9 billion in Air Force One fixed-price contract

Boeing is trying to renegotiate price cuts that it has agreed to supply two Air Force One aircraft to the White House, a senior government official said Tuesday.

Aircraft manufacturers signed a fixed-price contract of $ 3.9 billion in 2018 after then-President Donald Trump tweeted that the initial estimate of $ 5 billion was “ridiculous” and “cancelled the order.” ..

However, the deal is facing difficulties, and the scale of the matter was revealed on Tuesday thanks to parliamentary testimony by Darling Costello, Deputy Assistant Secretary for the Acquisition of the Air Force.

She told the House Military Commission that Boeing is seeking a one-year extension of the contract because of supplier trouble and a new coronavirus infection.

The plane was originally supposed to be ready in 2024.

Costello also said the Chicago manufacturer had sent a letter to the government asking the government to pay more for the contract, known as a “fair adjustment request.”

Boeing’s statement of intent is the first step in seeking a price increase for the program, and Costello said, “then we will begin the negotiation process.”

A problem with the company’s program surfaced in April when it announced that it had canceled its contract with GDC Technics, a supplier that installs aircraft interiors, because it “did not meet its contractual obligations.”

GDC Technics filed for Chapter 11 bankruptcy in the same month. The two companies are currently in proceedings with each other.

Boeing report First-quarter cost of $ 318 million related to the program.

Costello said Congress would receive updates in September on whether the schedule would change and that delivery timing and costs would be renegotiated together.

“We have received a notification from Boeing about a schedule change on the part of Boeing. We are currently in the process of risk assessment of the schedule … when they are completed. [the assessment] Determine if you need to adjust your schedule later this summer. “

Boeing did not immediately respond to requests for comment.

“It’s a disappointment for all of us. We thought this was probably a good deal for the government,” said Joe Courtney, a Democratic congressman from Connecticut.

Boeing wants more $ 3.9 billion in Air Force One fixed-price contract

Source link Boeing wants more $ 3.9 billion in Air Force One fixed-price contract

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