Trump Tweets: Stop building my new Air Force One; Costs are Out of Control

[SirLinksALot]

SOURCE: HOTAIR

URL: http://hotair.com/archives/2016/12/06/trump-stop-building-my-new-air-force-one/

by Ed Morrissey


Is this the Art of the Deal coming into play, or a stand against gouging by defense contractors? Despite insisting on the latest in luxury as a private citizen, Donald Trump seems to be saying no to a new fleet of presidential aircraft. He tweeted earlier today that the contract for replacing Air Force One should be canceled due to spiraling costs:

Boeing is building a brand new 747 Air Force One for future presidents, but costs are out of control, more than $4 billion. Cancel order!

— Donald J. Trump (@realDonaldTrump) December 6, 2016

Over the past few months, the Pentagon approved contracts that allowed Boeing to prepare to convert two of its 747-8s into replacements for the current pair of aging 747s that serve as Air Force One. The three contracts come to $169 million, a down payment on an expenditure that the Pentagon estimates will have a total cost of $1.65 billion. The Air Force announced that plan almost two years ago, and the Air Force promised to “use proven technologies and commercially certified equipment” to keep costs under control. That’s for two planes, not one, as the president always travels with both as a precautionary measure.

A search of news does not produce any links about costs doubling on the project. It’s certainly possible that it might be happening; the request for bid went out to Boeing in September, so perhaps the proposal came back with a surprisingly high bottom line. If so, it’s being kept so quiet that even industry outlets have missed it. Boeing already has a limited market for the 747-8 as it is, thanks to competition from Airbus and a preference for two-engine aircraft for most routes. In January, Boeing announced a cutback in production of the 747-8 due to lower demand. Does it make much sense that Boeing would make their product look even less commercially useful by blowing up a high-profile contract? For some perspective on that question, check out the hit that Boeing took after Trump’s tweet, losing 1% in premarket trade.

Besides, canceling the order doesn’t make much sense in practical or political terms. The current pair of 747s fulfilling this mission are almost 30 years old and are nearing the end of their planned lifespan as AF1s. Replacements have to be found soon, and Boeing already has the process underway. The only other four-engine airframe option would be the Airbus 380, which would mean dumping a product made in the USA to, um … outsource it overseas. That’s not exactly Making America Great Again, is it?

Either this is a stream-of-consciousness tweet that means nothing, or Trump wants to lean on Boeing publicly to wring a better deal out of them. As a defense contractor, they depend on government contracts for survival, and they had to have noticed what happened last week with United Technologies and its Carrier subsidiary. Nice contracts ya got there, pal …

[SirLinksALot]

INSIDE BARACK OBAMA's AIR FORCE ONE:

[jpsb]

From 1.65 billion to 3 billion.

The total cost of buying and converting the two planes is unknown, but the Air Force has requested $3 billion over five years for the program.

[RetBobbyMI]

In my 30 some odd years of Defens spending and acquisition programs, I can't remember one program that was under budget.  Defens contractors know what is appropriated, and miraculously their bids consume all of it and more.