Naval Air Systems Command awarded Northrop Grumman [NOC] a $3.2 billion modification to procure 24 E-2D Advanced Hawkeye Lot 7-11 aircraft.

This award is definitizing a previously awarded E-2D Lot 7 advance acquisition contract into a multi-year fixed-price-incentive-firm contract. The larger contract has used the advance acquisition to award several modifications for long-lead parts for Lot 7 aircraft.

E-2D Hawkeye (U.S. Navy)
E-2D Hawkeye (U.S. Navy)

NAVAIR noted in a statement this is the second multi-year procurement (MYP) contract to Northrop Grumman for E-2Ds. In 2014, it won an award to produce 25 aircraft, but Congress later increased it to 26. This award covers production of E-2Ds from 2019-2023.

“The use of the MYP contract allows a substantial savings over the use of single-year contracts and helps us fulfill our mission to increase U.S. Naval power at sea by providing our fleet the information they need to accurately plan and win the fight today and tomorrow,” Capt. Keith Hash, E-2/C-2 Airborne Tactical Data Systems Program Office (PMA-231) program manager, said in a statement.

The Navy said it projects savings in this new five-year MYP to reach $410.6 million, or 11 percent savings, compared to the cost of five single-year procurement contracts. The previous MYP contract saved $587 million, or 13.9 percent savings.

The work will largely be performed in Melbourne, Fla., St. Augustine, Fla., and Syracuse, N.Y., and is expected to be finished by August 2026.

In all, $944 million in fiscal year 2019 Navy aircraft procurement funds were obligated at award time, with none expiring at the end of this fiscal year.

The E-2D is replacing the Navy’s E-2C in the carrier airborne early warning squadrons, which each has five aircraft. The Navy has a requirement for 75 E-2Ds and plans to buy 18 over the Future Years Defense Program in the FY 2020 budget request.