Procurement: Rebuilds No Longer the Cheapest Option


May 27, 2007: Due to age, combat losses and high maintenance costs, the U.S. Army, Navy and Marine Corps will be spending billions of dollars over the next several years to revitalize their helicopter fleets. Although designed and built for 30 years or more of service, helicopters, must eventually be rebuilt or replaced with new aircraft. Remanufacturing and modernizing existing aircraft has been the most appealing option, since it is usually much less expensive than new builds. The costs are generally on the order of 1/3 to half, as the aircraft structure and many component parts are refurbished and reused. The process typically involves refurbishing the airframe to extend service life, replacing or upgrading cockpit avionics, sensors, communication gear, engines and transmissions. The decision on whether to rebuild or buy new is based on which approach will give the services the best "bang for the buck" in terms of capability, service life, maintenance and overall program costs. However, due to the escalating costs of remanufacturing old aircraft, the decision to rebuild aircraft or buy new aircraft is becoming increasing difficult.

The Army's program for their heavy lift CH-47 Chinooks is a combination of new build and remanufacture. They are remanufacturing 397 existing CH-47Ds, turning them into CH-47Fs, as well as building approximately 55 new CH-47Fs and a small number of MH-47Fs (special forces version with specialized equipment). The new build aircraft will be replacements for combat losses. The CH-47F aircraft has significantly greater capability then the "D" model. For example, it is able to lift over 3,900 lbs. more cargo (a total of ten tons). The Army program is going well with the first CH-47F delivered in 2005, but one significant change has been made. Due to the costs involved in refurbishing the existing aircraft's airframes, it is more cost effective to build new more durable composite airframes. This is not really surprising since these helicopters have been rebuilt more than once (from A models to D models) and in some cases are 40 years old or more. The Army anticipates flying these rebuilt (again) aircraft until 2030, giving many of them a total service life of 70 plus years.

The Marine Corps program involves the remanufacture of two helicopters, the UH-1N utility helicopter and the AH-1T/W attack helicopter. Most of these aircraft were originally manufactured in the 1970's, with some 44 AH-1W models built in the 1980's. The goal of this program is not only to deliver a much more capable aircraft, but also to have an 84 percent commonality of parts between the two, thus greatly reducing maintenance costs. The original program intended to remanufacture 180 AH-1T/W attack helos into AH-1Z Vipers models and 100 UH-1N utility models into UH-1Ys Venoms. This upgrade will give the aircraft a new 4 bladed composite rotor system, transmission, strengthened structural components, and modern digital cockpit avionics. However due to several factors, including combat losses and most importantly, the high unanticipated costs in remanufacturing Vietnam era airframes, the Marines concluded that it was more cost effective to build entirely new UH-1Ys.

The Navy's helicopter modernization program has been completely revamped due to high remanufacturing costs. The intent of the program was to convert anti-submarine and anti-surface warfare optimized SH-60Bs and anti-submarine and search and rescue SH-60Fs into the SH-60R configuration, which is capable of performing all these missions. The upgrades include new cockpit avionics, upgraded radar, and modifications to the airframe to allow the carriage of Mk-46/Mk-50 torpedoes, Penguin and Hellfire missiles, machine guns, and extend the aircraft's service life for 20 more years. The Navy came to the conclusion early in the program that the cost of remanufacturing the existing helos was only slightly less than the cost of new ones, therefore the Navy will now buy 243 new SH-60Fs and remanufacture only seven. On the surface this decision by the Navy is intriguing, since the Army and Marines have chosen to rebuild helicopters that are 30 to 40 years old, while the Navy's aircraft were built in the 1980's and 90's. It will be interesting to see how the U. S and other militaries will modernize their forces in the future as the cost for both new and rebuilt aircraft continues to soar.




Help Keep Us From Drying Up

We need your help! Our subscription base has slowly been dwindling.

Each month we count on your contributions. You can support us in the following ways:

  1. Make sure you spread the word about us. Two ways to do that are to like us on Facebook and follow us on Twitter.
  2. Subscribe to our daily newsletter. We’ll send the news to your email box, and you don’t have to come to the site unless you want to read columns or see photos.
  3. You can contribute to the health of StrategyPage.
Subscribe   Contribute   Close