The US Air Force yesterday awarded contracts to Boeing Co and Northrop Grumman Corp for work that could lead to replacement of the US intercontinental ballistic missiles.
The contracts form parts of a planned overhaul of the US nuclear arsenal, which cost tens of billions of dollars.
According to the Air Force, it gave Boeing a $349-million contract and Northrop Grumman a $329-million award to advance the technology needed for replacing the Minuteman III missiles dating to the 1970s. The Air Force wants to complete the work by August 2020.
Lockheed Martin Corp was the third bidder. According to a Lockheed spokeswoman, the company was disappointed, and looked forward to being briefed about the decision of the Air Force.
Boeing and Northrop Grumman will compete for a much bigger contract in 2020, when the Air Force will pick a single company for the engineering, manufacturing and design work on the nation's intercontinental ballistic missile system.
According to the estimates of the Air Force, it would cost $62.3 billion to replace the Minuteman III fleet. The estimate by the Pentagon's Cost Assessment and Program Evaluation office exceeded $85 billion.
''We are moving forward with modernization of the ground-based leg of the nuclear triad,'' said Air Force Secretary Heather Wilson said. ''Our missiles were built in the 1970s. Things just wear out, and it becomes more expensive to maintain them than to replace them. We need to cost-effectively modernize,'' she said in the release.
''As others have stated, the only thing more expensive than deterrence is fighting a war. The Minuteman III is 45 years old. It is time to upgrade,'' added Air Force Chief of Staff Gen. David Goldfein.
Northrop and Boeing were selected because the defence companies are determined ''to provide the best overall value to the warfighter and taxpayers based on the source selection's evaluation factors,'' which are their technical approach, technical risk and cost/price, Air Force officials said.