January 31, 2018 10:02:53 AM
A new lawsuit from a competitor, filed just days before a federal appeals court ruled in favor of Airbus Helicopters over the same issue, threatens to shut down production at the Columbus Airbus facility.
Airbus Helicopters President Chris Emerson blasted Italian rival Leonardo (formerly AugustaWestland) in a Tuesday conference call for what he termed an effort to hold hostage production and assembly of 51 Lakota UH-75A helicopters approved by Congress and ordered by the U.S. Army.
Emerson said the last Lakota helicopter ordered by the Army (from a 2015 contract) will roll off the Columbus Airbus assembly line at the end of February. A prolonged court battle with Leonardo could lead to furloughs or layoffs in Columbus, he said. The Columbus facility employs 182.
As the original suit progressed, Airbus continued work on its 2015 contract.
"For more than two years (since the first lawsuit was filed), our workers in Mississippi and Alabama have been delivering aircraft on their original contract -- more than 420 and counting -- without ever missing a deadline or going over cost," Emerson said. "But with every delay, Leonardo has pushed us one step closer to the end of the line and loss of employment."
At the heart of the suit is whether those orders (16 helicopters for Fiscal Year 2016 and 35 more for FY 2017) should be considered as "follow-on" orders from the original contract or should have been opened up for competitive bids.
On Jan. 23, a federal appeals court unanimously overturned a lower court decision that said the additional Lakota aircraft should go through a competitive bid process for the 16 helicopters ordered for FY 2016.
Four days earlier, Leonardo filed a suit to force the FY 2017 order of 35 Lakotas into competitive bid.
"We all assumed Leonardo would withdraw the lawsuit over the 2017 aircraft and the court scheduled a meeting last Friday at which point they could withdraw the suit," Emerson said. "They decided to continue their lawsuit with the same aircraft with the same reasoning even though the appeals court ruling makes it clear they have no chance of winning."
Emerson said he believes Leonardo hopes further delays will force his company to shut down production, opening the door for Leonardo to obtain future military contracts with one fewer competitor.
"If they succeed, they will have eliminated another competitor for the next decade," he said.
Emerson said the new lawsuit will continue until at least mid-April, when a judge assigned to the case will consider whether the suit has merits to continue.
In the meantime, Airbus Helicopter will continue to build Lakotas, without a contract and at its own expense, as long as the remaining components are in stock, Emerson said.
Emerson said the Columbus assembly facility will also work on other assembly jobs.
"The decision I made two years ago (when the original suit was filed) was to move all the Hl125 helicopter completion work to Columbus," Emerson said. "The completion work is high-hour work that would move there so I could continue to keep the workforce we have in Columbus."
After that would come layoffs and furloughs, he said.
"If Leonardo is successful, it's something that could affect every company that contracts with the military and every branch of the service," Emerson said. "Today it's the Army. Tomorrow it could be the Navy and the Air Force after that."
Leonardo's public affairs department in Philadelphia, Pennsylvania did not respond to requests for comment by press time.
Slim Smith is a columnist and feature writer for The Dispatch. His email address is [email protected]
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