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CPI Aerostructures fends off challenge to $53.5 million F-16 contract

A CPI Aerostructures worker makes aircraft parts on

A CPI Aerostructures worker makes aircraft parts on Oct. 11, 2012, in Edgewood. Photo Credit: Bloomberg News

CPI Aerostructures Inc. has been cleared to resume work on a $53.5 million logistics contract to repair and maintain wings of F-16 fighter jets after a rival challenged its qualifications, the company said Tuesday.

The Edgewood aerospace contractor said the Defense Logistics Agency rescinded a stop-work order after the U.S. Small Business Administration had determined that CPI Aero qualifies for the contract, the largest CPI has received from the government in more than a decade.

CPI, with about 300 employees, announced the contract in November, but a competitor's challenge to the company's status as a small business prompted the Defense Logistics Agency to halt work.

The unnamed competitor still could appeal the SBA ruling.

Shares of CPI Aero closed flat Tuesday at $10.90, and have lost about 27 percent since the beginning of the year.

In August, the company took a $44.7 million noncash charge related to the Defense Department's decision to mothball the A-10 ground-support jet, driving CPI Aero's stock down 10 percent in one day.

CPI Aero had been making leading edges for an anticipated 242 A-10 replacement wings as a subcontractor to Boeing since 2008. The A-10, also known as the "Warthog," was built by Fairchild-Republic Co., a Farmingdale company that closed in 1987.

CPI Aero has sought to balance its business by veering into the civilian business-jet market and seeking parts contracts with companies like Cessna and HondaJet.

Since the 1980s the number of aerospace companies with headquarters on Long Island has dwindled. Along with CPI Aero, holdouts include Telephonics Corp., based in Farmingdale, and Air Industries Group Inc., based in Bay Shore.

The most recent company to be swallowed up was Plainview-based Aeroflex Holding Corp., acquired in May for $1.46 billion by United Kingdom defense contractor Cobham PLC.

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