PRICE CUT CLINCHES £425m HELICOPTER DEAL FOR BOEING

MoD’s order with US giant leaves AgustaWestland out in the cold

BRITAIN is poised to buy 50 US-made Apache attack helicopters for £425million, dealing a blow to the UK’s last helicopter maker, Somerset-based AgustaWestland.

Defence Secretary Michael Fallon is expected to announce the order at the Farnborough airshow in July.

The Boeing Apaches are part of a larger order of 240 helicopters being placed mainly for the US Army.

US sources said this has allowed the UK to get a big discount. Each helicopter is believed to cost £8.5million.

The British Army is understood to have recommended that the Government buy the Apaches 18 months ago, but the decision was delayed after lobbying from AgustaWestland, which wanted to make its own bid.

The company’s managing director is former Defence Secretary Geoff Hoon.

The original Apaches were bought from the US in 1995 for £20million and then the Government commissioned the British firm to upgrade them with new engines and avionics taking the total cost per helicopter to £44million.

These improved helicopters are regarded as having performed significantly better than their wholly US-made equivalents in Afghanistan and were also impressive during the conflict in Libya.

The helicopters in the new deal will be the advanced Apache Guardian model and they will replace the British Army’s existing 50-strong fleet.

They have engines made by the US company GE rather than Rolls-Royce. The crews can also control drones.

AgustaWestland, part of the Italian defence giant Leonardo-Finmeccanica, has a £430million contract to maintain the present Apaches, ensuring the survival of hundreds of jobs until 2019. The firm employs 3,200 staff.

The future of the contract for maintenance work on the Apaches, also currently held by AgustaWestland, is unknown – throwing doubt over jobs at the Yeovil site.

Two years ago the deputy commander of the

Joint Helicopter Command, Brigadier Neil Sexton, called for the advanced Apache to be acquired.

He told Jane’s Defence Weekly: ‘The Army is absolutely sold on the Apache’s performance in Afghanistan.’

The decision by the MoD is reminiscent of the issues behind the so-called Westland Affair of 1985-86 when the then Prime Minister Margaret Thatcher clashed with Defence Secretary Michael Heseltine over the future of Westland, as it was then known.

She favoured its rescue by a US firm, Sikorsky, while Heseltine favoured its merger with European rivals, including Finmeccanica.

The Yeovil plant makes the Super Lynx 300, Wildcat and Merlin helicopters and the AW189 civil helicopter.

An MoD spokesman said: ‘The Apache programme is currently in its assessment phase and we expect to make a decision by summer 2016.’

Boeing and AgustaWestland declined to comment.