Boeing expanded a winning streak for its defense business on Monday with a $2.4 billion contract to replace the aging UH-1N “Huey” choppers used to protect America’s missile bases.
The agreement covers up to 84 of Boeing’s MH-139 helicopters, which are flown by more than 270 governments, militaries, and companies worldwide, the Chicago-based company said in a statement. The aircraft, which can carry up to 15 passengers, has state-of-the-art features such as sliding side windows that accommodate on-board machine guns and an engine designed to better evade enemy forces’ infrared detection systems.
“With the AW139 platform’s more than 2 million flight hours and established supply chain, we look forward to applying our expertise to drive cost savings while supporting mission readiness,” said Ed Dolanski, president of Boeing’s U.S. government services business.
Boeing and rival defense contractors including Lockheed Martin have benefited from a resurgence in military spending this year as President Trump and his Republican allies in Congress work to revitalize U.S. defensive capabilities. A two-year agreement ratified by lawmakers in March raised the cap for defense spending to $700 billion for fiscal 2018, which ends Sept. 30, and to $716 billion for 2019.
Earlier this summer, Boeing won a $194 million contract to update software and equipment used by crews training to work on the U.S. Navy’s P-8A Poseidon, a maritime patrol jet; a $2.9 billion order from the Air Force for 18 KC-46 refueling tankers; and an $805 million contract to develop the first unmanned plane for Navy aircraft carriers.
“As we look at the overall aerospace and defense market, we continue to see a robust, healthy marketplace,” CEO Dennis Muilenburg said at a Laguna Niguel, Calif., conference in mid-September. “We’re also seeing strengthening defense budgets here in the U.S. and amongst some of our key allies.”
The planemaker’s stock has climbed 25 percent in New York trading this year to $367.99, more than twice the gains of the broader S&P 500. Work on the latest contract will be performed primarily in Ridley Park, Pa., according to the U.S. Defense Department, which allocated $98 million in research and development funds from the budget year that concludes this week.
The Air Force has flown Hueys, built by Textron’s Bell Helicopter business, since 1970. Those choppers, designed for a crew including pilot, co-pilot and flight engineer, were first used for search-and-rescue missions and can carry up to 13 people, according to the Air Force. With a range of more than 300 miles, the aircraft was later modified to handle missile security.
