After losing a contract worth billions of dollars from the U.S. Army to produce a helicopter that will eventually replace the Black Hawk, Lockheed Martin’s Sikorsky is protesting the decision.
Bell Textron Inc. won the contract in December with its tilt-rotor aircraft, the V-280 Valor. The contract could be worth more than $70 billion over the decades, according to reporting from Reuters. Lockheed Martin’s Sikorsky and Boeing proposed the DEFIANT X helicopter.
Lockheed Martin is asking the U.S. Government Accountability Office to review the Army’s decision.
“Based on a thorough review of the information and feedback provided by the Army, Lockheed Martin Sikorsky, on behalf of Team DEFIANT, is challenging the FLRAA decision,” the statement said. “The data and discussions lead us to believe the proposals were not consistently evaluated to deliver the best value in the interest of the Army, our Soldiers and American taxpayers.”
Protests are common, said Dan Grazier, senior defense policy fellow at the Project on Government Oversight.
“It’s almost like a tough guy kind of thing, where companies aren’t going to just go quietly into the night when they lose one of these contracts,” Grazier said. “They want to show that they’re still big players, show that they can’t be pushed around. That’s why, a lot of times, these kinds of protests are just kind of automatic after one of these awards are announced.”
The GAO will make sure the Army evaluated the winning proposal based on the requirements the companies received to ensure fairness. Protests are successful about 45% of the time, said J.J. Gertler, a senior analyst at the Teal Group Corp.
If the office finds the Army followed the rules, the protest is disallowed and Bell’s V-280 procurement process continues. On the other hand, if the GAO finds the Army didn’t follow the rules, the office can recommend a new competition.
In 2008, the GAO recommended that the U.S. Air Force made “significant errors” that affected the outcome for a competition between Boeing and Northrop Grumman for refueling tankers and recommended to reopen the competition.
In an Army press conference on Dec. 7, Maj. Gen. Robert Barrie said the Army has planned a contingency of a protest in the timeline, but feels confident in the process of making the decision.
“We are confident that the process we went through was disciplined and deliberate and it counted for the complexity of the decision that was involved,” Barrie said.
A review process typically takes less than three months, Gertler said. The GAO has until April 7 to make the decision. Protests have decreased over the years after Congress started requiring the U.S. Department of Defense to explain to the company why they won or lost, he said.
“As you might imagine, the Department of Defense issues competitions for all kinds of things from mowing the grass at bases all the way up to major weapons programs like this,” Gertler said. “And the total number of competitions is very large and tends not to get protested until it turns into serious money.”
Seth Bodine is a business and economic development reporter for the Fort Worth Report. Contact him at firstname.lastname@example.org and follow on Twitter at @sbodine120.
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