Pentagon Cuts Boeing F-15 Contract Size by $456 Million

Earlier this week, the Department of Defense awarded Lockheed Martin (NYSE: LMT  ) $253 million to supply training equipment to help Royal Saudi Air Force pilots learn to fly dozens on new Boeing (NYSE: BA  ) F-15SA fighter jets that the country is buying as part of one of the biggest arms sales in world history. But if that deal sounded a bit insulting -- hiring Lockheed to train pilots to fly its biggest rival's airplanes -- then Thursday's news has just added injury to insult.

On Thursday, the Pentagon announced that it's subtracting more than $456 million off of Boeing's original contract to build new, and upgrade old, F-15 fighter jets for the Saudis. Originally, Boeing had been awarded $4 billion to sell the Saudis 84 new F-15SA fighters, and to upgrade a further 70 planes to the F-15SA configuration. Thursday's "award," however, reduced the value of this contract to a "not-to-exceed amount" of $3.5 billion.

No explanation was given.

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  • Report this Comment On March 15, 2013, at 3:19 AM, us54985312 wrote:

    There's no question in the mind of this reader that Boeing got their shirt wrinkled rather than to have any Pentagon worker furloughed with the amount of action going on and currently pending overseas. The strings of luxury are still available just trim the size of the fleet.

  • Report this Comment On March 15, 2013, at 3:58 AM, bugmenot wrote:

    Have to pay for those Obamaphones no matter what.

    www.obamaphone.net

    The FSA reelected their sugar daddy for a reason. Never mind what Korea and Iran are doing.

  • Report this Comment On March 15, 2013, at 8:36 AM, Dignolita wrote:

    How about it is a high maintenance aircraft that does nothing well. It was a compromise beyond all compromises. It is not much of a fighter plane (too slow, lacks manuverability), not much of a bomber (not much of a payload, limited range. Almost as bad as the F-18 and the F-22. At least the F-22 has manuverability when they can keep it flying.

  • Report this Comment On March 15, 2013, at 8:43 AM, crustyone wrote:

    When will operating costs of air transportation by the Executive Branch (AF1, AF2, etc.) begin to be reduced by a minimum of this amount?

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