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Project on Government Oversight

Boeing and Textron Try to Prevent Osprey from Going the Way of the Dodo

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August 8, 2011

A new multi-year contract for 122 V-22 Ospreys has been submitted to the Navy for consideration by Boeing and Textron. The contract would renew the current deal for five more years at a cost of $8 billion, according to Bloomberg.

The current contract is on time and under budget, but you may remember that POGO and others have raised a number of concerns about the Osprey, including questions about its safety, cost and how thoroughly the Pentagon tested the aircraft.

As part of our blueprint to reduce the deficit, POGO and Taxpayers for Common Sense recommended declining to renew the V-22 program. In our report, we recommended that the program not be renewed because it was not cost effective and the V-22s could be replaced by MH-60 or Ch-53 helicopters. “According to the Government Accountability Office (GAO), the V-22 costs over $11,000 per hour to fly and had a full mission capability (FMC) rate of just 6 percent in Iraq,” the report said.

The current $10.9 billion contract for 174 Ospreys has each aircraft costing about $62.6 million, but the new proposed contract puts the cost at $65 million each, according to the Bloomberg article. Shouldn’t the cost of building V-22s go down over time as experience and the economies of scale kick in? Why the $2.4 million increase for each aircraft?

Some people have offered their support of the Osprey. A Defense Daily article about the new proposal said “the MV-22 has had the lowest Class A mishap rate of any tactical rotorcraft in the Marine Corps during the past decade. Fiscal year 2010 Navy flight-hour cost data also show that the Osprey has the lowest cost per seat-mile, or the cost to transport one person over a distance of one mile, of any U.S. naval transport rotorcraft,” according to the Naval Safety Center.

But at the same time, a number of reports have questioned the safety and cost problems of the Osprey. In January, we wrote about a National Journal article that summarized four separate, independent reviews of Pentagon spending that all included cutting the V-22 program as part of a larger program of spending reduction.

As the Bloomberg article said, “Signing a multi-year contract also virtually guarantees those aircraft can’t be canceled because the military would face steep termination costs.”

We are sticking with our recommendation from the blueprint for debt reduction—don’t renew the procurement contract. We need the money elsewhere, and we don’t need the risks of the V-22.

Founded in 1981, the Project On Government Oversight (POGO) is a nonpartisan independent watchdog that champions good government reforms. POGO’s investigations into corruption, misconduct, and conflicts of interest achieve a more effective, accountable, open, and ethical federal government.

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