The Navy on Wednesday awarded Sikorsky Aircraft an initial $1.24 billion contract to build six presidential helicopters that would begin to replace the current aging fleet, known for delivering heads of state on the South Lawn of the White House.
The contract is the Navy’s second attempt in recent years to develop a new fleet of Marine One helicopters and will be closely monitored by watchdogs Congress. In 2009, the Pentagon killed the previous contract after costs doubled to $13 billion and cost taxpayers $3.2 billion and did not produce an operable helicopter.
Defense officials have vowed to get it right this time. They said the new helicopters won’t be nearly as ambitious, or expensive, as the versions of helicopters they tried to build last time.
But some are worried that there appears to have been just one bidder this time, Sikorsky, a division of United Technologies, which built the current presidential helicopters. Sikorsky lost out on the previous contract to a team of AgustaWestland and Lockheed Martin. Lockheed will work with Sikorsky on the new contract.
By 2019, the Navy is expected to begin ordering the rest of the 21-helicopter fleet, which is expected to be ready by 2023, the company said.
●The U.S. Transportation Department issued an emergency order designed to reduce the risks of transporting crude from North Dakota’s booming Bakken region by rail, a week after an oil train derailed and burned in Lynchburg, Va. The order requires railroads to notify state emergency agencies when they haul Bakken crude through communities. A separate advisory discourages carriers from using an older tank car known as the DOT-111 tied to some accidents, although the order doesn’t ban their use.
●The former manager of a Georgia peanut-processing plant linked to a 2009 salmonella outbreak that killed nine people plans to enter a new plea, according to a court filing. Samuel Lightsey was to appear in federal court in Albany, Ga., for a change of plea hearing. Lightsey was the manager of Peanut Corporation of America’s plant in Blakely and is accused of scheming to manufacture and ship salmonella-tainted peanuts. The outbreak caused one of the largest recalls in history. The company’s dirty processing plants were blamed for the outbreak that killed nine people and sickened hundreds.
●There’s no need to tell owners of recalled General Motors small cars to stop driving them, according to Transportation Secretary Anthony Foxx. In a written response to two senators who asked for such an order, Foxx said engineers with the National Highway Traffic Safety Administration have determined it is not necessary. GM is recalling 2.6 million cars worldwide to fix an ignition-switch problem.
● Productivity declined at a 1.7 percent annual rate, the biggest drop since the first quarter of 2013, the Labor Department said, as harsh winter weather restrained output. The drop in productivity is temporary and Federal Reserve officials are likely to shrug off the spike in labor costs, analysts said.
●AOL said its quarterly profit declined, with its stock price falling 20 percent as it missed earnings expectations because of the cost of restructuring its digital and media entertainment businesses. Net income dropped 64 percent to $9.3 million because of costs related to workforce reduction and a $10 million impairment charge for software at the division that operates its legacy subscription dial-up services.
●Electric car maker Tesla Motors lost $49.8 million in the first quarter as development costs grew compared with a year ago. Tesla’s loss of 40 cents per share contrasts with a profit of 10 cents per share in the January-March period last year. Revenue grew 10 percent to $620.5 million. Tesla produced a record 7,535 Model S sedans and delivered 6,457 to customers.
— From news services
●All day: Chain store sales.
●8:30 a.m.: Weekly jobless claims.
●10 a.m.: Weekly mortgage rates.
●Earnings: CBS, News Corp, Wendy’s.