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Exchange of A model Black Hawks generates significant cost savings

Tue, 06/17/2014 - 10:19am
U.S. Army

REDSTONE ARSENAL, Ala. (June 16, 2014) -- The Utility Helicopters Project Office handed over the logbook and keys for three UH-60A Black Hawk aircraft to Sikorsky Aircraft Corporation during an aircraft exchange/sale, Wedneday.

The aircraft exchange/sale, also known as the Black Hawk Exchange and Sales Transaction, or BEST, is one of the ways the Utility Helicopters Project Office, known as UHPO, is divesting A model Black Hawks out of the Army's inventory.

Seventeen UH-60A Black Hawks are currently parked at the Madison County Executive Airport in Meridianville, Ala. These aircraft are among the first lots to arrive under the BEST divestiture program, which was approved by Heidi Shyu, the Army's acquisition executive.

"Over the next 10 years, we'll be divesting approximately 400 to 800 aircraft, which will allow us to modernize the fleet and make room for newer aircraft," said Lt. Col Michael Blaine, deputy product director for UH-60 Modifications/OGA (Other Government Agencies).

Only two of the 17 in the current lot are considered non-flyable. Aircraft not chosen by Sikorsky will be eligible for sale using the General Services Administration, or GSA, Auction, a government established program that specializes in aircraft and aircraft parts sales.

In accordance with Army regulations, the UHPO can pursue a one-for-one aircraft exchange (or other equitable exchange), sale, or reimbursable transfer, provided all proceeds are used to purchase, rent, or lease a replacement aircraft.

As such, the exchange with Sikorsky was made on fair market value of the aircraft, and will be credited against the UH-60M multi-year to offset the price of a new UH-60M Black Hawk.

"Today marks another Black Hawk victory, where our taxpayers and the Army benefit from the intrinsic value of these incredible machines," said Col. Thomas Todd, Utility Helicopters project manager.

Using the exchange/sale authority also enables agencies to avoid the costs associated with holding the property and processing it through the normal disposal cycle.

The exchange culminates more than two years of hard work by the Utility Helicopter Team, especially the fleet management/logistics team that developed the divestiture plan; the business management/contracting team that did all the behind-the-scenes work to get the BEST program approved by the Department of the Army; and the Aviation and Missile Research Development and Engineering Center's Prototype Integration Facility that is executing the consolidated storage facility, where the Black Hawks will be exchanged or sold.

"Our goal is to divest as many aircraft as possible, either through state or federal, or through Sikorsky or GSA," said Blaine. More A model Black Hawks will be flown or hauled in every four to six weeks, from various military units across the globe. Those units will then receive either L or M model Black Hawks to modernize their fleet.

Sikorsky has the opportunity to choose from each lot before the aircraft can be sold through GSA auction.

"Also before they (Sikorsky) get a chance to look, federal, state and other government agencies have the first opportunity to look at the aircraft," explained Blaine.

"These Black Hawks have served the Army for thirty years throughout our world," said Todd. "We are proud of their legacy and appreciate their role in the Army's history. Their usefulness in search-and-rescue and similar missions for the civilian market will continue, following a refurbishment and resale by the Sikorsky Aircraft Corporation."

Tom Boland, program manager for aircraft updates with Sikorsky, said that they are excited to finally have the three aircraft in their books.

"Remanufacturing these aircraft is definitely a best value for us. We take a known quality product, and we can do a few things to clean them up to get them to new customers," Boland said. "It's a great opportunity for us."

Sikorsky plans to either sell parts of the aircraft to customers, reset them, or upgrade them to an L model.

"Our goal is for these to go to customers that don't have Black Hawks now -- new emerging customers that will create new markets for us and give the Army a way to responsibly divest these aircraft in the future," Boland said.

From now until September 2014, UHPO has scheduled 46 A model Black Hawks to divest. Divestiture quantity is dependent on the number of M model Black Hawks the Army intends to purchase each year.

Although this is not the first time the Army will go through the GSA auction process as part of the divestiture plan, it is still a relatively new concept within Army aviation acquisition. The Project Office for Cargo Helicopters was the first Project Managment office to sell Army aircraft through the GSA auction, selling all 10 CH-47D aircraft in the lot, in 2014, and generating a cost savings of more than $28 million for the American taxpayers.

"We have been very fortunate to have had a very helpful team from Cargo," said Anna Wilson, UHPO BEST business program lead. "It's definitely been a collaborative process."

Wilson is looking forward to seeing the types of companies or individuals that might express interest in purchasing the A model Black Hawks.

"There are thousands of aviation enthusiasts based on our discussions with GSA," Wilson explained. "It's hard to say, especially in these initial phases, who our biggest interest is going to come from, but I'd say we have a very healthy market for potential customers."

"It's definitely a win-win solution for everybody," Wilson added. "We avoid the cost of divesture for the Army, so we're saving the funding. I think it's just very exciting."

All A model Black Hawks will be exchanged or sold "as is" and "where is." It will be the customer's responsibility to transport the aircraft they purchase.

The UHPO anticipates to kick off the GSA auction of the A model Black Hawks this summer.

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