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Navy may delay decision on replacing carrier supply planes

By Andrea Shalal

WASHINGTON (Reuters) - The U.S. Navy is looking for an inexpensive way to replace its aging fleet of 35 C-2 planes that ferry passengers and spare parts to aircraft carriers, but may be able to put off a procurement decision for one to two years, a Navy official said.

Rear Admiral Michael Manazir, who heads the Navy's air warfare division, said in an interview on Wednesday he was looking at proposals from C-2 maker Northrop Grumman Corp to modernize the existing planes, or buy V-22 tiltrotor planes from Boeing Co and Textron Inc's Bell Helicopter unit.

"There's not a very clear winner either way," he said.

But Manazir said the existing C-2A twin-engine turboprop planes that haul cargo, mail and passengers between carrier and shore would likely last long enough to allow him to put off a decision on their replacements for a few years.

Boeing and Bell have been pressing the Navy to move ahead with the V-22 option no later than 2017, when new orders are needed to maintain the production line. The companies are also working on possible foreign orders, including from Israel.

Manazir said the Navy had some flexibility since it planned to use options that were already available, instead of starting a more expensive and lengthy effort to design a whole new plane.

"I could feasibly, because of the service life of the C-2, wait to gain more information, gain more insight into the budget, and actually push this off one or two years," Manazir said after the annual Navy League conference.

Regardless of which solution was ultimately chosen, Manazir said, it was critical that the planes were cheap, given other priorities, including the need to replace the current Ohio-class submarines that carry nuclear weapons. "It's pushing the price point down to the lowest it can possibly be," he said.

Manazir said both options were "very viable" and that he was heartened by industry-funded efforts to develop a way to transport the large single engine built by Pratt & Whitney, a unit of United Technologies Corp, to power the F-35 fighter jet that will be used on carriers beginning around 2019.

The admiral said the Navy's five-year budget plan included "several hundred million dollars" to start development of the "carrier on-board delivery" or COD program, but he welcomed any efforts by the companies involved to jump-start the process.

"If I could get some kind of a deal for the (research, development, test and evaluation) money that I was going to spend, that's attractive to me," he said.

Manazir said the Navy was studying all aspects of the issue, including how the Navy could benefit from Marine Corps training and maintenance facilities if it opted to buy the V-22s.

Keith Daniel, director of military business development for Bell Helicopter, said the V-22, which takes off and lands like a helicopter but flies like a plane, offered more flexibility given its ability to land on other ships besides a carrier, which could cut costs by reducing the need to fly back to shore.

Stephen Squires, director of product support and sustainment programs for Northrop's E-2/C-2 business, said his company would extend the life of the C-2s by 20 years by replacing the center wing, engine and nacelles on the existing planes, which he said could carry twice as much cargo by volume than the V-22.

The changes would lower the plane's fuel costs by 15 percent, and reduce maintenance costs since the new engines would be common with E-2D planes already on the carriers, he said.

(Reporting by Andrea Shalal; Editing by Mohammad Zargham)

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