The Lockheed Martin VH-71 Kestrel was a variant of the AgustaWestland AW101 helicopter that was being manufactured to replace the United States Marine Corps' Marine One U.S. presidential transport fleet. Originally marketed for various competitions as the US101, it was developed and manufactured in the US by a consortium headed by Lockheed Martin, consisting of Lockheed Martin Systems Integration – Owego (LMSI), AgustaWestland and Bell Helicopter.
In January 2005, the US101 was selected for the VXX Presidential Helicopter Replacement Program, and was promptly re-designated as the VH-71. However, development was subject to delays, cost overruns, and engineering issues; Lockheed attributed much of these issues to unanticipated and extensive modifications being demanded by the government that had been absent from the request for proposal (RFP) issued. A Government Accountability Office (GAO) report in 2011 also recognised that a lack of flexibility and compromise on the part of the government had negatively impacted the program. By late 2008, the cancellation of the VH-71 was looking increasingly likely.
In February 2009, President Barack Obama asked Secretary of Defense Robert Gates about placing the project on hold or canceling it because of its high cost: over $13 billion for the planned 28 helicopters. In June 2009, the U.S. Navy terminated the contract after spending about $4.4 billion and taking delivery of nine VH-71s. After the cancellation, the delivered helicopters were sold to Canada for $164 million, where they were used as source of spare parts for its fleet of AgustaWestland CH-149 Cormorant search-and-rescue helicopters.
Development
US101 and VXX competition
The AgustaWestland AW101, initially designated as EH101, was originally developed and produced by EH Industries, which was a joint venture between the British Westland Helicopters and Italian Agusta companies; Westland merged with Agusta to form AgustaWestland in 2001. AgustaWestland held considerable interest in the export prospects of the AW101, including the prospects for an extensive overseas manufacturing consortium. On 23 July 2002, Lockheed Martin and AgustaWestland announced that they had signed a 10-year agreement to jointly market, manufacture and support a medium-lift helicopter, an AW101 derivative, in the United States. At that time, the team declared that the derivative, which was designated as the US101, would be "65% American". The companies envisaged the aircraft being adopted in three major roles; U.S. Air Force combat search and rescue, U.S. Coast Guard search and rescue, and U.S. Marine Corps executive transport."Lockheed Martin and AgustaWestland Announce Long-term Agreement for US101 Helicopter". Lockheed Martin, 23 July 2002."AgustaWestland seals 10-year US101 deal with Lockheed Martin." Flight International, 24 July 2002.
In early 2002, the Lockheed-AgustaWestland partnership sought out other firms to participate in the proposed local manufacturing effort for the US101; in particular, the team pursued Bell Helicopters, which was at that time part of another EH101 consortium, offering the type in Canada."Manufacturers seek US101 partner." Flight International, 19 February 2002. That same year, Rolls-Royce Holdings, who manufactured the EH101's RTM322, also sought out an American partner to locally produce the engine; Rolls-Royce also envisioned integrating US-specific technology into the engine and its potential use in powering the Sikorsky UH-60 Black Hawk helicopter."Rolls-Royce considers US sourcing for helicopter engine." Flight International, 24 July 2002.Lewis, Paul. "US Army weighs engine options." Flight International, 20 August 2002. By August 2002, there were reports in the media, of various US aircraft manufacturers, including Bell, Boeing and Kaman Aerospace, that were holding discussions with the consortium and may potentially be selected as a subcontractor to perform the domestic assembly of the US101.Lewis, Paul. "US101 programme seeks local subcontractor bids." Flight International, 6 August 2002.Lewis, Paul. "Wake-up call." Flight International, 4 February 2003.Lewis, Paul. "Bell reviews helicopter portfolio." Flight International, 4 February 2003. Boeing showed persistent interest in joining the US101 consortium, as well as in alternate arrangements to produce the NHIndustries NH90 helicopter.Lewis, Paul. "Boeing renews interest in US EH101 production deal." Flight International, 26 November 2002.Lewis, Paul. "Boeing and EADS in helicopter talks." Flight International, 20 August 2002.
On 15 May 2003, AgustaWestland signed an agreement with Bell Helicopter to undertake final assembly of the US101 in the U.S."AgustaWestland Selects Bell Helicopter as Airframe Manufacturer for US101 Production". Lockheed Martin, 15 May 2003.Lewis, Paul. "Bell set to complete US101 team line-up." Flight International, 13 May 2003. Under the pact, AgustaWestland would produce the main rotor blades and main fuselage sections at its headquarters in Yeovil, UK. The company would also manufacture other components, including the gearbox, at its facility in Cascina Costa, Italy; this represents a work share of 36 per cent. The remaining 64 per cent work share was split between Lockheed Martin (31 per cent) and Bell Helicopter (27 per cent) and other firms (6 per cent)."US101 Blows Away Sikorsky in $6.1 Billion VXX Competition", Air Forces Monthly.Lewis, Paul. "Rivals exchange blows in VXX helicopter battle." Flight International, 20 May 2003.
In February 2002, the US Marine Corps commenced a study to identify potential replacement rotorcraft for the aging Sikorsky VH-3D presidential transport helicopters."USAF/USMC look for replacement rotorcraft." Flight International, 19 February 2002. On 18 December 2003, the United States Department of Defense issued a Request for Proposals (RFP) for the supply of 23 helicopters to be used as a replacement for the 11 VH-3Ds and 8 VH-60Ns of the Marine Corps' HMX-1 squadron, which performs the role of Presidential helicopter transportation; this requirement was given the designation of VXX, or the Presidential Helicopter Replacement Program."VXX Selection Delayed" . Aviation Today, 1 May 2004.Gertler 2009, p. 2. Two companies, AgustaWestland and Sikorsky Aircraft responded to the VXX RFP; additionally, that had been interest in a potential Bell Boeing V-22 Osprey-based bid, however the rotorcraft was deemed to be non-transportable by military airlift and thus unsuitable to qualify.Trimble, Stephen. "Offers in to supply US presidential helicopter." Flight International, 6 January 2004.
Sikorsky had proposed the VH-92, a variant of the H-92 Superhawk, in partnership with FlightSafety International, L-3 Communications, Northrop Grumman, Rockwell Collins, Vought Aircraft Industries, and GE-Aviation."VH-92 team is unveiled." Flight International, 13 January 2004."Sikorsky fights back with launch of Superhawk." Flight International, 17 June 2003. During the bidding process, Sikorsky attacked the US101 for its foreign origins; in December 2004, Sikorsky VXX programme manager Nick Lappos derided the bid as: ""What is a socialist country and a socialist company going to teach us about competition?".Trimble, Stephen. "Sikorsky attacks US101 credentials." Flight International, 14 December 2004. The selection was originally to occur in April 2004, however programme officials decided to postpone their decision for a further eight months to conduct more analysis on the bids."Rivals for US VXX presidential helicopter race move forward." Flight International, 4 May 2004.
On 28 January 2005, the Department of Defense announced that it had selected the US101 as the winner."DoD Special Briefing on Award of Presidential Helicopter Contract" . DoD, 28 January 2005.Trimble, Stephen. "US101 snatches presidential prize." Flight International, 1 February 2005. It has been speculated that the US101's three engines had been a decisive factor over the rivaling twin-engined VH-92."VH-71 Managers Thrift-Minded" . Rotor & Wing via aviationtoday.com, 1 March 2009. John Young, the USN's assistant secretary for acquisition technology and logistics, stated of the selection: "The Lockheed team probably started with a helicopter that needed less. They more closely met the requirements we had laid out, and that allowed them to table less work that had to be completed to get to the finish line and deliver a product".Trimble, Stephen. "Marine wonder." Flight International, 8 February 2005. The US101 team was awarded a US$1.7 billion contract for the System Development and Demonstration phase."Lockheed Martin to Build New Presidential Helicopter" . U.S. Department of Defense, 28 January 2005.Trimble, Stephen. "Opening doors for the EH101." Flight International, 8 February 2005. In July 2005, the US101 received the military designation VH-71 Kestrel.
Program problems and delays
Delays and engineering issues plagued the VH-71's development.Huber, Mark. "Development hurdles ahead for future presidential helicopter" . AINonline, 28 August 2007. By 2007, the estimated cost of developing and modifying the aircraft had risen by 40% to $2.4 billion and had passed the $4.2 billion expected for the production of the fleet.Warwick, Graham. "Presidential Helicopter Costs Soar" . Flight International, 22 May 2007. In March 2008, the program cost had risen and was projected to cost a total $11.2 billion,"Capitol Hill expected to weigh in on embattled VH-71" . Aerospace Daily and Defense Report, 17 March 2008. or about $400 million per helicopter.Baker, Peter. "Cost Nearly Doubles For Marine One Fleet". Washington Post, 17 March 2008.
During dialogue over the CSAR-X (in which the EH101 was LMSI's offering), the Air Force Source Selection Authority (SSA) stated the program's performance had been "unsatisfactory". In March 2007, a Government Accountability Office (GAO) report, upholding Sikorsky and Lockheed's protests against Boeing's HH-47, mentioned "LMSI had received a little confidence rating for past performance due to unsatisfactory performance under its current contract for the VH-71 Presidential helicopter, which was evaluated as the most highly relevant to this procurement." The SSA stated that LMSI had "show[n] that it could not reliably meet important schedule requirements and had difficulty in systems engineering flow-downs to their subcontractors.""B-299145.4: Sikorsky Aircraft Company; Lockheed Martin Systems Integration‑Owego‑‑Request for Reconsideration" . Government Accountability Office, 29 March 2007. Lockheed responded that government insistence on extensive modifications, unanticipated in the RFP, as the source of cost overruns. A GAO report in 2011 concluded that the VH-71's development was not allowed flexibility or trade-offs considered by the customer.Fabey, Michael. "Rotorcraft Report: VH-71 Program Following Right Course: GAO" . Aviation Week, 4 May 2011.
In December 2007, DoD officials met with the White House Military Office to discuss the program's future; the Pentagon had apparently wanted to terminate the VH-71 due to setbacks, budget issues, and design problems. The White House overruled a decision to cancel; the program was effectively placed on hold while options were considered.. Defense News, 14 December 2007. In July 2008, the VH-71A (also called Increment 1) was to reach operating capability in 2010. The second phase of the development, VH-71B (Increment 2) was expected to start entering service in 2017.O'Keeffe, Niall. "VH-71A to gain obtain operational capability in 2010" . Flight International, 18 July 2008.