Trump’s administration is looking for ways to make Boeing’s new Air Force One cheaper (BA)

Secretary of Defense James Mattis officially ordered a review of the US Air Force’s next generation presidential transport program to determine potential cost cutting opportunities.

In a memo dated January 26, Secretary Mattis announced that his department will work with the White House Military Office to “identify means to substantially reduce the program’s cost while delivering needed capabilities.”

“We welcome the opportunity to continue our discussions with the Trump administration,” a Boeing spokesperson told Business Insider in an email. “We are focused on providing the armed forces with needed capabilities at the best possible value.”

In December, then President-elect Trump tweeted that the two Boeing 747-8-based jet are too expensive and threatened to cancel the entire program citing a $4 billion price tag.

According to a report by the Government Accountability Office published in March 2016, the new aircraft that will serve as Air Force One — also known as the Presidential Aircraft Recapitalization (PAR) program — has an estimated total cost of $3.21 billion spread out over the next decade or so.

The PAR program will consist of the development, testing, and construction of two 747-8-derived jets set to enter service in 2024. This means that even if Boeing delivers on time, Trump will not have the opportunity to fly on the aircraft.

By that time, the existing Boeing 747-200-based VC-25A aircraft — which were ordered by Ronald Reagan — will be 34 years old.

In the memo, Secretary Mattis identified areas such as autonomous operation, aircraft power generation, environmental conditioning, survivability, and military/civilian communications capabilities as potential cost-cutting targets.

Earlier this month, Boeing CEO Dennis Muilenberg met with President Trump prior to his inauguration at Trump Tower in New York. At the company’s latest earnings call, Muilenberg made it clear to analysts and the media that he is optimistic about his company’s future under the Trump administration.

The Department of Defense review of the PAR program is expected to commence immediately.