Marcus Weisgerber | Defense One | August 1, 2017 | 0 Comments

Trump Wanted a Cheaper Air Force One. So the USAF Is Buying a Bankrupt Russian Firm’s Undelivered 747s

Trump exits Air Force One in March. Trump exits Air Force One in March. Senior Airman Kimberly Nagle/Air Force

President Donald Trump said the projected cost of new Air Force One aircraft was too high, so the U.S. Air Force found a way to lower it: by buying a pair of Boeing 747 jetliners abandoned by a bankrupt Russian airline.

Air Force officials are now finalizing a contract with Boeing for the two planes, according to three defense officials with knowledge of the deal. The Pentagon could publicly announce the deal as soon as this week.

"We're working through the final stages of coordination to purchase two commercial 747-8 aircraft and expect to award a contract soon," Air Force spokeswoman Ann Stefanek said in a statement.

The Air Force is not expected to disclose the specific value of the contract, but officials said that the military is getting a good deal on the planes. Boeing lists the average sticker price of a 747-8 as $386.8 million; the actual amount paid by airlines and other customers varies with quantities, configurations, and so forth.

“We’re still working toward a deal to provide two 747-8s to the Air Force — this deal is focused on providing a great value for the Air Force and the best price for the taxpayer,” Boeing spokeswoman Caroline Hutcheson said in a statement.

The 747s that will be transformed for Presidential transport were originally ordered in 2013 by Transaero, which was Russia’s second-largest airline until it went bankrupt in 2015. Boeing built two of the four jets in the order, but the airline never took ownership of them.

Typically, an airline makes a 1 percent down payment when it orders a plane, then pays the balance in installments. Transaero did not fulfill its scheduled payments, according to an industry source.

“Aeroflot absorbed most of Transaero’s existing fleet, but declined to pick up Transaero’s 747-8I orders worth $1.5 billion at list prices,” FlightGlobal reported last month.

So Boeing flight-tested the two completed jets and put them in storage. Flight tracking data shows that the aircraft, numbered N894BA and N895BA, were last flown in February, to the Southern California Logistics Airport in Victorville, a sprawling facility in the Mojave Desert whose hot, dry air prevents corrosion. This “boneyard” is largely occupied by retired commercial jets that still bear the liveries of Delta, FedEx, British Airways, and Cathay Pacific. Other planes, unmarked, sit with their engines shrinkwrapped in anticipation of one day returning to flight.

Boeing has been paying to store the two 747s in new condition while searching for a buyer, which allowed the Air Force to negotiate a good deal for them, sources said. It’s similar to the way car dealers discount new vehicles from the previous year when new models hit the lot.

Turning a standard 747 into a flying White House requires more than a blue-and-white paint job. After the Air Force takes ownership of the planes, contractors will give them a state-of-the-art communications system, defensive countermeasures, and hardening to withstand an electromagnetic pulse caused by a nuclear explosion. New custom interiors will have conference rooms, offices and seating for White House staff, guests and journalists.

The Pentagon’s 2018 budget request, sent to Congress in February, shows that the Air Force plans to spend nearly $3.2 billion between 2018 and 2022 on two new Air Force One jets. Trump would likely fly on the new planes if he is elected to a second term.

The 747s currently flown as Air Force One are 747-200s, older models that started flying presidents in the early 1990s.

Related: Trump’s Air Force One Tweet Rattles the Defense Industry

Related: Buying a New Air Force One Is Complicated

Related: Boeing Breaks Air Force One

Nicknamed the “Queen of the Skies,” the four-engined 747 has been a tough sell in recent years. Airlines instead have opted for cheaper-to-fly two-engine planes like the 777. Boeing has likely built the last passenger 747; any future orders are likely to be for cargo versions.

United and Delta, the last two American carriers to fly older models of the 747, plan to retire the plane from service by year’s end. Just last week, the iconic aircraft made its last planned domestic revenue flight, a United trip from Chicago to San Francisco.

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