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Boeing Gets More Time on Army Project

May 14, 2003|From Bloomberg News

Boeing Co. has been given an extra two years to design and develop the Army's multibillion- dollar family of armored combat vehicles because more time is needed for testing, the General Accounting Office said Monday.

The move by the GAO pushes the target date for the first fully equipped combat units to 2013.

The Army has said that the Future Combat Systems is its highest-priority program, and the Pentagon has budgeted $22 billion through 2009 for development and early production.

Boeing and San Diego-based Science Applications International Corp. in March 2002 beat out General Dynamics Co., the Army's top producer of armored vehicles, for rights to be the lead systems integrator. Boeing subsequently hired General Dynamics and United Defense Industries Inc. to help with design, engineering, production and delivery of test vehicles.

The project involves 19 types of smaller, lighter, armored vehicles designed to outmaneuver an enemy and destroy it with long-range weapons. The vehicles' electronics will let them network with drones and other reconnaissance sources to target enemy formations.

A Pentagon panel is set to review the decision today.

The panel will eventually determine the number of vehicles to be produced by Boeing's subcontractors, the vehicles' unit costs and the total price of development and procurement.

The Army already has revised the system's overall design phase from three years to five to allow longer testing of complex technologies.

Shares of Chicago-based Boeing fell 27 cents to $29.55 on Tuesday on the New York Stock Exchange.

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