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Beechcraft Takes Appeal of Contract to Court

By Rich Smith – Mar 22, 2013 at 4:17PM

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Company files suit to challenge Pentagon override of its GAO protest of contract given to Embraer and Sierra Nevada.

The contract to pick a company to build a squadron of prop-driven fighter planes for the Afghan air force remains a source of conflict.

On Wednesday, privately held Beechcraft Defense Co. filed a complaint with the United States Federal Claims Court contesting a U.S. Air Force decision to go ahead with the awarding of a contract to rivals Sierra Nevada Corp. and Embraer (ERJ -1.76%) while Beechcraft has an appeal pending with the Government Accountability Office (GAO).

The matter is a bit complicated. Two years ago, Sierra Nevada and Embraer (SN-E) won a $1 billion contract to build 20 Super Tucano fighters for Afghanistan. Beechcraft, then known as Hawker Beechcraft, challenged the award, forcing the Pentagon to rebid the contract.

Last month, SN-E won the rebid as well. Beechcraft again challenged this decision, but the Pentagon promptly quashed this challenge, citing "unusual and compelling circumstances" that demanded quick fulfillment of the contract to equip Afghanistan with much-needed air power.

Beechcraft then took the matter to court with this week's action. According to a company statement, Beechcraft is contesting the Air Force's lifting the stay of performance on the Light Air Support contract while the GAO continues to review Beechcraft’s protest. The company said it expects a GAO ruling within 90 days.


Fool contributor Rich Smith has no position in any stocks mentioned. The Motley Fool recommends Embraer-Empresa Brasileira. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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