Army’s MV-75 production award could slip due to CR, raising program costs: Textron

WASHINGTON — Uncertainty over federal funding could delay the Army’s first low-rate initial production (LRIP) contract for the MV-75 Cheyenne II helicopter, which would lead to an increase of as much as $150 million, Textron executives said today.

“With the start of the fiscal year in a [continuing resolution], we’d expect a possible push in the timing of the LRIP award. Previously, we were thinking Q4 into Q1 of next year,” Chief Financial Officer David Rosenberg told investors this morning during an earnings call.

A delay could exacerbate the financial hit Bell Textron already expects to take on the MV-75 program. In the previous quarter, the company estimated that funding delays would cost $60 million to $110 million. If the LRIP contract is pushed back even more, that figure could rise to $110 million to $150 million, Rosenberg said.

Bell was selected as the prime contractor for the MV-75 Cheyenne II helicopter in late 2022. Developed under the Arm’s Future Long Range Assault Aircraft (FLRAA) program, the Cheyenne is a tiltrotor aircraft expected to gradually replace the service’s UH-60 Black Hawk fleet once fielded in the 2030s.

The potential delay comes after the Army exhausted nearly all of its available fiscal 2026 funding for the MV-75 in July, according to Textron’s quarterly filing. The company continued work on the program while reducing spending to manage the funding shortfall.

In July, the Army requested to shift $350 million in funding to the MV-75 program to support Textron’s work building and testing eight prototype helicopters.

Congress approved that reprogramming request during the third quarter, Textron CEO Lisa Atherton said during the earnings call. About $300 million of that money was committed to the program in contract changes, covering costs Bell and its suppliers had already incurred.

“The $350 [million] was the request of the estimate of what the government expected that we would need throughout the third quarter,” Atherton told investors. “The government was able to quickly put on contract [modifications] the $300 [million] to cover the actuals that we and our suppliers had accrued. … As supplier invoices continue to trickle in through this month and next month, we will continue to obligate against that.”

Bell Textron recorded a financial hit on the MV-75 in the second quarter of FY26 due to funding delays that increased the program’s expected costs, Rosenberg said. Although Congress approved the Army’s reprogramming request, the company has not been able to recover that loss as it must wait for the government to officially add the funding to its contracts before it can reassess the earlier losses, he said.

“As timing continues to progress and the remaining contract [modifications] take place, we will then be able to take a look at previous charges,” Rosenberg added.

Federal budget uncertainty could continue to affect the program into 2027, as the government operates a CR while lawmakers work to approve a full-year defense spending bill.

Atherton said the proposed FY27 budget includes about $2.3 billion for the MV-75, though that funding still requires congressional approval.

Meanwhile, Bell Textron continues to work on the MV-75 aircraft ahead of flight testing next year. The company has so far completed three wings, received its first nacelles and built the first fuselage, while gearboxes have advanced into testing, Atherton said. The company expects to join the first fuselage with its wing assembly in the fourth quarter, she added.