The competing entry attempted to play up nationalist sympathies, and give the impression of a security risk by using a Brazilian airframe, provided by EMBRAER, using their more affordable, reliable, and cost effective (the latter two being questioned) EMBRAER ERJ 145 platform — Gulfstream's airframe did have longer range and could fly at higher altitudes but the acquisition and operational costs (main requirements of DoD for ACS platform) of ERJ 145 were considered much more attractive.
It was later decided that the ERJ 145 would not suffice due to weight constraints,[1] and thus, while Lockheed was to retain the system integrator role, the Army attempted to re-bid platform entry among several larger aircraft.
EMBRAER were to produce the first five airframes in Brazil (based upon the commercial ERJ 145), while final assembly on following units would have taken place in Jacksonville, Florida, to satisfy Department of Defense workshare requirements.
Lockheed has faced criticism from the United States Department of Defense (DoD), and specifically, the US Army, for not being able to properly forecast weight issues with the system.
[2] The Department of Defense paid a contract termination fee of $200 million, nearly all of which was passed on to subcontractors such as Argon ST, Harris Corporation, and L-3 Communications.