January 14, 2013
Credit: Credit: Tony Osborne/AWST
Amy Butler Washington and Tony Osborne London
The last few years have been tough for European defense manufacturers that planned a decade ago to boost their presence and, if possible, establish manufacturing sites in the U.S.
The past year has been a bitter pill particularly for Italian conglomerate Finmeccanica, which owns Alenia Aeronautica. The top two programs cited by the company's North American branch—both centered on a tactical cargo airlifter—have now fizzled in the U.S. market. A recent decision by the U.S. Air Force to end work on a training and support contract for the Afghan Air Force's refurbished G222 transports was a major blow last month, right on the heels of its decision last winter to end buys of a new version of the aircraft, called the C-27J.
The company was already disillusioned with its Pentagon experience after the abrupt 2009 cancellation by the Navy of the next-generation U.S. presidential helicopter program, for which Finmeccanica's AgustaWestland helicopter unit was teamed with Lockheed Martin.
Despite these setbacks, Finmeccanica officials say they do not plan to cut back their U.S. operations. “Finmeccanica's presence in the United States dates back more than a century and our commitment to this country extends long-term. We remain highly optimistic about our future prospects in the largest defense and security market in the world,” says a statement provided by Finmeccanica North America spokeswoman Angelica Falchi. “We are currently in pursuit of both near- and long-term programs with the U.S. government.”
Potential opportunities include a forthcoming competition to replace the aging Air Force T-38 fast jet trainer fleet with about 350 new airframes as well as an Army OH-58D Kiowa Warrior follow-on.
Finmeccanica North America's 2008 acquisition of DRS Technologies, primarily known for providing electronic systems to the Pentagon, is expected to be a major growth area. The company's North America operation is in the midst of a restructuring designed, in part, to adjust to U.S. market realities. Headquarters in Rome has also undergone a restructuring, including consolidations aimed at operating efficiencies.
The G222's demise is not only a bad mark for Alenia; it is the latest in a string of failures by the Pentagon to efficiently field aviation assets for Afghanistan as the White House presses ahead with plans to pull forces out in 2014.