MD Helicopters Says LUH Award to Eurocopter Is Outrageous

Published:

August 4, 2023

Updated:

March 11, 2025

The senior team at MD Helicopters, Inc. calls the Army’s Light Utility Helicopter choice “flat-out wrong”. They argue the service stacked the deck for EADS North America, parent of Eurocopter. Managers say the Army brushed past cost data, safety files, and past flight hours that could have swung the verdict. Three vice-presidents used the word “outrageus” in one briefing last week, a slip that showed how tense the mood got inside the Mesa, Ariz. plant.

Army leaders intend to replace an aging fleet that handles evacuations, troop moves, and disaster sorties. MDHI states its Explorer airframe, sold in dozens of civil markets, answers every need at less money. They also stress it is built by an American workforce. Eurocopter’s EC145, the winner, keeps a standard tail rotor. That point sparked heated talk about brown-out landings and rotor strikes. A few lawmakers wonder if the Army has under-valued those risks while handing billions to a firm with Europe-based ownership.

Contract in Contest

The LUH order tops $3 billion across ten years. Up to 352 helicopters will fill log-chain gaps left by older Kiowa and Huey types. Procurement staff tested four finalists, weighed cost per flight hour, and scored mission metrics. They then picked the EC145 and signed a notice of intent.

MDHI feels the calculus looked skewed. Executives note that NOTAR—the firm’s no-tail-rotor tech—cuts blade strike dangers for crews walking near a running ship. They insist the eval board gave that safety edge almost no credit.

LUH Mission Set

Medical pickup under hot-n-high airfields
Routine troop lift across training ranges
Homeland disaster response, fire patrol, border watch
Utility runs between posts that lack long runways

MD Explorer Offer

The Explorer, a twin-engine craft, entered service in 1994. MDHI fitted it with the two-stage NOTAR system: one fan in the tail boom blows air and side slots vent it to steer yaw.

Company pilots claim this yields:

Noise levels under 85 dB by cabin door
Lower vibration on stretchers
Quick tail checks—no drive shaft to lube

Internal slide packs show a 14 percent drop in direct maint hours versus EC145 numbers gathered from civil EMS fleets. MDHI says that slice alone saves the Army $190 million through 2035. Spreadsheets use a fuel price of $3.59 per gallon, perhaps low yet still in line with DoD planning charts at the time.

Eurocopter EC145 Selection

The EC145 first flew in 1999. It runs two Safran Arriel engines and a four-blade main rotor. The Army team liked its roomy cabin and high hot-day hover ceiling. They also leaned on a past record of 1.5 million flight hours in law-enforcement roles worldwide.

Tail rotor critics inside MDHI note the blade arc adds eight feet to ground clear width, a sore point near pine trees or power poles. Eurocopter staff answer that Army pilots cut power sooner than civil medics, slashing exposure. Spares support, they add, comes from Columbus, Miss. where final assembly lines sit.

Eurocopter estimates 500 U.S. jobs spin off the deal. MDHI counters that figure folds in temporary logistics labor, not full-time machinists. The sides trade press notes almost weekly, each loaded with numbers that outsiders struggle to audit.

Home-Field Industry Stakes

MD Helicopters traces its roots to Hughes Tool Co. The factory at Falcon Field survived boom-bust swings yet kept a core of skilled fitters. Local trade groups warn the LUH loss could cut up to 280 mesa payroll slots inside two years. They fear know-how will drift abroad even if Eurocopter builds parts stateside.

Lawmakers from Arizona and Alabama wrote a joint letter that asks why a “clear American solution” fell short. They push for full GAO review before any long-lead funds exit Army accounts. Defense sub-committee staff plan to read classified cost tables once auditors finish.

GAO Protest File

MDHI lodged its protest 72 hours after the award notice. The move freezes new contract work until at least mid-November. GAO now holds briefing books, red-lined eval sheets, and sworn statements. Outcomes could be:

Re-score only the cost column
Re-open talks on safety factor weighting
Dismiss every claim and let the deal stand

GAO has 100 days by statute. MDHI lawyers push for an “expedited” look, though the board rarely grants that. Eurocopter attorneys filed motions to shorten the pause, calling the protest “thin on facts and thick on hyperbole,” a phrase that drew chuckles yet not from MDHI’s side.

Market Response

Analysts at two broker houses note MDHI lacks the deep capital pool of EADS. They say protest paths often end in small concessions, not full reversals. Still, they admit press buzz can tilt future bids. When Boeing lost parts of its tanker fight to Airbus, noise alone shifted later RFP language.

Rotorcraft vendors such as Bell see modest upside. If the LUH row drags, Army leaders might defer buys and stretch older OH-58 fleets. That gap could create demand for interim leases, spare kits, or pilot conversion courses. Each niche means more invoices across the supply chain.

Capitol Hill Ripples

House Armed Services members prefer home-built gear, though many also prize alliance ties. The EC145 story forces them to juggle both. A few call the French-German parenthood a minor worry since labor stays local. Others argue EU control lets profit flow offshore.

If GAO flags process holes, expect hearings. If not, the story may fade until next budget season. Staffers hint that flight-hour logs and mishap rates carry more bite than slogans about “Buy American.” MDHI collects those logs now, hoping one item sticks.

Trans-Atlantic Factors

The United States leans on NATO partners for parts, yet critics warn heavy reliance can pinch spares in a crisis. Eurocopter says its Mississippi line holds raw stock enough for 18 complete kits, a buffer against shipping lags. Skeptics reply that gearbox castings still ride boats from Germany, a fact no press handout denies.

Offset clauses require Eurocopter to funnel $600 million into U.S. sub-contracts. Some will land at avionics shops in Texas. Others fund composite blade trials in Utah. Whether that offsets long-term intellectual drift is an open question.

Army Modernization Path

The service lists LUH as a “Tier 2” urgency item, below Future Vertical Lift yet above minor sensor buys. Schedule slides hurt training hubs first, not combat brigades. If MDHI’s protest stalls things into 2026, flight schools at Fort Novosel may fly tired TH-67s even longer, raising maint workloads.

Explorer vs. EC145 Head-to-Head

MDHI markets three main plus points:

Zero tail rotor lowers risk in dusty zones
Quiet signature helps covert medics near villages
Simpler tail means fewer moving joints to fail

Eurocopter counters with:

Cabin length lets two litters lie flat side-by-side
Proven airframe already cleared by FAA and EASA
Strong logistics under a global AOG spares net

Army scorers welded these facts into a 5-column sheet. They weighted cost at 40 percent, performance at 30, risk at 20, and growth room at 10. MDHI says the risk score unfairly dinged NOTAR because data on battle damage was sparse. They argue less data does not equal high risk, yet the rubric set emptie cells to max penalty. That hurt.

Looking Downrange

Should GAO uphold the protest, the Army might redo only the risk math rather than re-bid. That tweak could narrow the score gap, maybe enough to flip the table. Or it might just confirm the same result and end debate. MDHI keeps both scenarios on whiteboards.

If Eurocopter keeps the win, first LUH squadrons hit initial operational capability in late 2027. That date lets instructors switch syllabi and trainers ahead of Future Attack Recon Aircraft, easing pipeline flow.

Either path affects depot builds, engine spares, and vendor hire plans through the 2030s.

WHAT’S NEW — March 2025

Eurocopter has shipped 142 EC145s so far. Units in Texas, Georgia, and Alaska log solid uptimes, averaging 92 percent avail. Pilots praise cockpit ergonomics yet whisper about tail-rotor FOD on gravel strips.

MDHI has not quieted. Executives flew a tweaked Explorer—now with digital autostab—to Capitol Hill on 28 January 2025. Noise meters showed 4 dB less at fifty feet than early models. Staff aides watched, some nodding. No Army brass attended.

GAO issued a narrow follow-up in February 2025. It denied MDHI’s 2023 protest but noted Army analysts “could have documented noise factors deeper.” MDHI calls that a small win. They push for an independent cost drill, claiming life-cycle math still favors Explorer by $310 million.

Eurocopter spokespeople dismiss the math. They cite bulk‐buy discounts and stable labor rates. A procurement note dated 12 March shows line tempo at the Mississippi plant rising to four airframes a month.

Defense committees plan open testimony mid-2025. MDHI wants a seat to recap cost claims; Eurocopter plans to parade delivery charts. Army reps will front readiness stats for the EC145s now in uniform. Odds of a sudden contract reversal remain thin, yet the debate lingers, shaping how both rivals eye next-gen scout and lift programs.

Final Outlook

The LUH story reveals recurring fault lines: cost versus origin, test data versus intuition, and speed versus debate. MDHI fights to keep edge tech alive at home. Eurocopter bets stable output and big-fleet history will sway decision-makers.

While GAO’s docket inches along, crews still fly older birds, maintainers hunt parts, and budgets shift. The outcome will steer rotorcraft paths for a decade, maybe two. Watching from the ramp, line chiefs care less about paper scores than whether the next chopper starts first crank. That basic need, in the end, will judge which bid truly served the soldier best.