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Boeing (BA) Wins $173M Contract to Modify F/A-18 Aircraft
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The Boeing Company (BA - Free Report) recently won a modification contract that offers it the scope to integrate the Cockpit Pressure and On-Board Oxygen Generating Monitoring System into the new F/A-18E/F production aircraft in an attempt to reduce potential physiological episodes. The Naval Air Systems Command, Patuxent River, MD, awarded the deal.
Details of the Deal
Valued at $172.8 million, the contract is estimated to be completed in September 2028. Through this modification, Boeing also has the chance of procuring aircraft armament equipment (AAE) to support the production and delivery of 78 F/A-18E/F aircraft. The jet makers can also procure various quantities of miscellaneous AAE hardware, as well as non-recurring engineering for new tooling, refurbishment, and the replacement of broken-down tools and technical documents.
The majority of the work related to this deal will be executed in Mesa, AZ and Clearwater, FL.
Significance of F/A-18E/F
Boeing’s F/A-18 Block III Super Hornet is a twin-engine, supersonic, all-weather multirole fighter jet, which is capable of performing virtually every mission in the tactical spectrum, including air superiority, day/night strike with precision-guided weapons, fighter escort, close air support, suppression of enemy air defenses, maritime strike, reconnaissance, forward air control and tanker missions.
Boeing believes that the Super Hornet is the most cost-effective aircraft in the U.S. tactical aviation fleet, costing less per flight hour than any other tactical aircraft in U.S. forces inventory.
Impressively, F/A-18 Super Hornet combat aircraft has emerged as the leading choice of weapon for militaries across the world. In fact, the Royal Australian Air Force and the Kuwait Air Force, apart from the U.S. Navy, operate these fighter aircraft in large numbers. Furthermore, nations like Canada, Finland, Switzerland and Spain currently have Boeing’s Super Hornet in their arsenal.
So, no doubt the F/A-18 fleet enjoys strong demand in the aircraft market, which is further evident from the latest contract win.
Looking Ahead
With rising security threats across the globe, emerging economies like the Asia Pacific, the Middle East and South America are spending a lot on enhancing their defense arsenals. Meanwhile, developed nations like the United States and Europe have already been leading the defense market. With the United States being the largest weapons exporter worldwide, the nation has been spending amply on defense products, wherein the combat aircraft enjoys one of the dominating positions. Boeing, being the largest aircraft manufacturer in the United States, thus enjoys a dominant position in the combat aircraft market.
Looking ahead, per a Mordor Intelligence report, the global combat aircraft market is expected to witness a CAGR of 2.5% during the 2021-2026 time period, with North America constituting the largest share of this market. Such growth can be attributed to a rise in global threats and geopolitical instabilities, and increased spending on defense. These projections should benefit Boeing along with other U.S.-based combat jet manufacturers like Northrop Grumman (NOC - Free Report) , Lockheed Martin (LMT - Free Report) and Textron (TXT - Free Report) .
Price Movement
Shares of Boeing have surged 32% in the past 12 months against industry’s decline of 4.9%.
Image: Bigstock
Boeing (BA) Wins $173M Contract to Modify F/A-18 Aircraft
The Boeing Company (BA - Free Report) recently won a modification contract that offers it the scope to integrate the Cockpit Pressure and On-Board Oxygen Generating Monitoring System into the new F/A-18E/F production aircraft in an attempt to reduce potential physiological episodes. The Naval Air Systems Command, Patuxent River, MD, awarded the deal.
Details of the Deal
Valued at $172.8 million, the contract is estimated to be completed in September 2028. Through this modification, Boeing also has the chance of procuring aircraft armament equipment (AAE) to support the production and delivery of 78 F/A-18E/F aircraft. The jet makers can also procure various quantities of miscellaneous AAE hardware, as well as non-recurring engineering for new tooling, refurbishment, and the replacement of broken-down tools and technical documents.
The majority of the work related to this deal will be executed in Mesa, AZ and Clearwater, FL.
Significance of F/A-18E/F
Boeing’s F/A-18 Block III Super Hornet is a twin-engine, supersonic, all-weather multirole fighter jet, which is capable of performing virtually every mission in the tactical spectrum, including air superiority, day/night strike with precision-guided weapons, fighter escort, close air support, suppression of enemy air defenses, maritime strike, reconnaissance, forward air control and tanker missions.
Boeing believes that the Super Hornet is the most cost-effective aircraft in the U.S. tactical aviation fleet, costing less per flight hour than any other tactical aircraft in U.S. forces inventory.
Impressively, F/A-18 Super Hornet combat aircraft has emerged as the leading choice of weapon for militaries across the world. In fact, the Royal Australian Air Force and the Kuwait Air Force, apart from the U.S. Navy, operate these fighter aircraft in large numbers. Furthermore, nations like Canada, Finland, Switzerland and Spain currently have Boeing’s Super Hornet in their arsenal.
So, no doubt the F/A-18 fleet enjoys strong demand in the aircraft market, which is further evident from the latest contract win.
Looking Ahead
With rising security threats across the globe, emerging economies like the Asia Pacific, the Middle East and South America are spending a lot on enhancing their defense arsenals. Meanwhile, developed nations like the United States and Europe have already been leading the defense market. With the United States being the largest weapons exporter worldwide, the nation has been spending amply on defense products, wherein the combat aircraft enjoys one of the dominating positions. Boeing, being the largest aircraft manufacturer in the United States, thus enjoys a dominant position in the combat aircraft market.
Looking ahead, per a Mordor Intelligence report, the global combat aircraft market is expected to witness a CAGR of 2.5% during the 2021-2026 time period, with North America constituting the largest share of this market. Such growth can be attributed to a rise in global threats and geopolitical instabilities, and increased spending on defense. These projections should benefit Boeing along with other U.S.-based combat jet manufacturers like Northrop Grumman (NOC - Free Report) , Lockheed Martin (LMT - Free Report) and Textron (TXT - Free Report) .
Price Movement
Shares of Boeing have surged 32% in the past 12 months against industry’s decline of 4.9%.
Zacks Rank
Boeing currently holds a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.