By Christopher Harress - The Boeing Company (NYSE:BA) won a $1.16 billion contract from the Pentagon to re-manufacture 72 AH-64E Apache Helicopters and build 10 new helicopters, the Defense Department said.
The deal, which was announced on Tuesday, also includes six revamped crew trainers and additional logistical support that will provide ground support, engineering work and spare parts. The contract will run until June 30, 2016 and most work will take place in Mesa, Ariz. at Army Contracting Command.
The deal will be viewed with relief from Boeing as it comes at a time when a frugal Pentagon is cutting back significantly on defense contractors. Moreover for Boeing, the deal will offset set their flagging commercial aircraft business which has seen a slide in orders during winter. In January, the company took on just 38 new orders, down from 318 in December. Current orders for February are currently in the mid-50s but these orders have to be officially confirmed.
The company is still optimistic that it will hit its $30 billion to $31 billion defense contract target for 2014.
The deal was made possible thanks to the $1.1 trillion Omnibus spending measure that President Obama signed into law. It will allow $93 billion for the Pentagon to buy weapons and an additional $63 billion for research and development.
While the global economy is improving and the governmental budget issues drawing to a close, Boeing are taking no chances and are looking outward to foreign militaries and international contracts.