uploads///northrop grumman part

Northrop Grumman Faces Dogfight over Air Force Trainer Contract


Oct. 13 2016, Updated 3:04 p.m. ET

US Air Force Trainer Contract

The US Air Force has put up an order for 350 trainer aircraft on competing bids. The request for proposal is likely to be finalized by December 2016 and the contract will be awarded in 2017. The US Air Force’s existing fleet of Northrop (NOC) T-38s, with an average age of 48 years, has aged significantly and has become unreliable and expensive to maintain.

The T-38 was also designed to train third-generation fighter jets. The increasing production rates of the F-35 created the requirement of a trainer aircraft that met training needs of piloting a fifth-generation jet. The T-38 had around 12 training gaps that it could not fill. Based on costs of in-production trainers, the cost of the deal is likely to be around $11 billion–$17 billion.

Article continues below advertisement

Northrop Grumman and competitors strike partnerships

The competition on the trainer aircraft contract has become so intense that it almost resembles a dogfight. As the simulator and aircraft portions will be awarded as one contract, major aerospace (XAR) players have grouped themselves in teams to give themselves a better shot at clinching the deal. Northrop has partnered with BAE Systems (BEAV) and L-3 Communications (LLL) to form a team.

There are three other teams, and all of them have now submitted the designs for the aircraft. The other three competitors are:

  1. Boeing (BA) and Saab AB team
  2. Lockheed Martin (LMT) and Korea Aerospace Industries
  3. Raytheon (RTN), Leonardo-Finmeccanica, CAE USA, and Honeywell (HON)

Partnership specifics

The Northrop Grumman team initially intended to put up T2 Hawk trainers of BAE Systems in the bidding contest. But since it experienced performance shortcomings, it secretly developed a new aircraft known as the Model 400.

The company publicly revealed its entry for the first time in August 2016. If awarded, Northrop is expected to do the manufacturing, while L-3 Communications and BAE Systems will be tasked with simulation and training. Lockheed Martin is offering the T-50s that it already manufactures with its partner in South Korea.

Raytheon is offering T-100s, which will be powered by Honeywell’s F124 turbofan engine, and the simulation-based training systems will be designed and developed by CAE. Boeing submitted its design only recently, in September 2016.

In the next part, we’ll take a closer look at Northrop’s challenges with the T-X contract.


More From Market Realist

    • CONNECT with Market Realist
    • Link to Facebook
    • Link to Twitter
    • Link to Instagram
    • Link to Email Subscribe
    Market Realist Logo
    Do Not Sell My Personal Information

    © Copyright 2021 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.