Boeing, Textron secure $10.4 billion V-22 Osprey U.S. DOD contract

Bell Boeing has received a $10.4 billion U.S. Department of Defense contract for the V-22 Osprey that guarantees production of at least 167 more of the aircraft through 2012, Bell Boeing announced Monday.

Bell Boeing is a strategic alliance between Bell Helicopter, a unit of Textron (NYSE: TXT) company, and Boeing (NYSE: BA).

The five-year contract includes 26 CV-22 aircraft for the U.S. Air Force Special Operations Command and 141 MV-22 aircraft for the U.S. Marine Corps. The contract includes an option for additional aircraft.

Both Boeing and Textron moved higher on the news. Boeing shares gained 83 cents to $74.30 and Textron rose 47 cents to $55.07 in early Monday trading.

The V-22 is a tiltrotor aircraft with proprotors and engines installed in nacelles at the tips of both wings.

Analysis: The contract is good news on a number of fronts, the most obvious of which is additional work for Boeing and Textron. In the last six months Boeing shares have declined roughly $30 to about $74 on rollout delays for its next-generation 787 Dreamliner commercial aircraft, and the U.S. economic slowdown. The news is also a mild shot in the arm for the U.S. economy, which given the large number of industrial jobs lost to cheaper overseas manufacturing zones, can use all of the domestic industrial jobs it can get.