Last week was quite active in aerospace and so were we, unable to post. So here’s a recap of some of the things that occurred and our thoughts.
More politics and the Tanker
For the past two years we have bemoaned the politicizing of the procurement process for the KC-X tanker, extending our criticism mostly on previous Boeing efforts with its Congressional supporters–most notably Sen. Patty Murray (D-Boeing/WA) and Reps. Norm Dicks (D-Boeing/WA) and Todd Tiahrt (R-Boeing/KS). Now comes Sen. Richard Shelby (R-Northrop/AL) who, in a display that represents all the worst of what’s wrong with Congress, placed a hold on 70 Obama Administration appointments in a fit over his displeasure of the KC-X Request for Proposals and his belief it disadvantages the Northrop Grumman KC-30.
We find the action repugnant.
We tend to side with Northrop in the belief that the Draft RFP favors Boeing’s smaller KC-767 since the extra capabilities of the larger KC-30 don’t get “extra credit.” We also believe this is a “price shoot-out” and not a “best value,” despite the DOD characterization to the contrary.
But Northrop’s 2007 bid was $12m-$15m less per plane than Boeing’s, so Northrop demonstrated it can under-price its competition. Northrop fears that because Boeing saw the cost-basis for the KC-30 in Boeing’s GAO protest of the 2008 award that this time Boeing has the advantage. Pentagon follower James McAleese believes this is a red-herring and the DOD says this RFP is changed enough from the 2007 competition that the cost-basis from that one is irrelevant to this one.
We think the greater threat is that this time Boeing will not offer a developmental airplane (the KC-767 Advanced Tanker), but an off-the-shelf KC-767 (we don’t believe the KC-777 developmental airplane will be offered, either). Also, Jim Albaugh, the former CEO of Boeing’s defense unit, now is CEO of the Commercial unit where the 767 is built and will be more aggressive on price than his predecessor was. Finally, Boeing is changing the 767 production line to a Lean manufacturing system which will shave double-digit costs from making the airplane.
The advantage and problem for Northrop has been that its airplane is fundamentally different than Boeing’s airplane. The KC-30, based on the Airbus A330-200, is bigger than the 767 which gives it more capability–if that’s what DOD wants. Even the USAF couldn’t decide, and that’s what caused the protest in 2008. Throughout that competition, Boeing said it was told the Air Force wanted one thing and decided mid-stream it wanted “more;” the GAO agreed and threw out the award to Northrop.
We have always felt that if DOD wanted “just” a tanker, the KC-767 is the better choice. If DOD wants a more flexible Multi-Role Tanker-Transport, the KC-30 is the better choice. We still advocate for a split buy for political and strategic reasons. Take some of the Stimulus money, double the procurement and split the order. But stop the politicizing of the process in the way the Congressional supporters have done.
One of the things that kept us busy last week was attending one of the aerospace events last week: Boeing showing off its #3 787 test airplane equipped with the new interior. The reviews were mixed by the media, especially for those of us who had seen the mock-up at the Customer Experience Center.
The test airplane had an interior that was equipped for…testing. As such, it wasn’t an interior for a customer. Boeing made this point prior to taking the media out to board the aircraft. Standard coach seating was installed throughout the aircraft rather than premium seating in front. While the mock-up has an entry that is grand by airline standards, test plane #3 had traditional galleys installed at the entry way. All this led some journalists to criticize. We thought this unfair.
The large windows with their ability to darken at the touch of a switch rather than use the traditional window shades was a big hit. The crew rest areas in the overhead areas, providing beds (no jokes here) for the crews on long flights were of great interest. The high-tech cockpit likewise were bit hits. The overhead bin design and mood lighting drew a lot of interest.
To be sure, Boeing’s design and what the airlines install may bear little resemblance. But we thought the interior represents a step up from what we’re used to on an airplane. Boeing did a good job.
Airplanes 3 and 4 fly this month; 5 and 6 may fly as early as next month or perhaps in April. The 787 program is moving forward after the 2 1/2 years of delays. Let’s hope the test program doesn’t reveal something that will set the program back yet again.
747-8 first flight
Today is Sunday; the 747-8s first flight is scheduled to launch tomorrow, a year late. The delay was driven in large part by the knock-on affect of the 787 delays, but also from some of its own. So be it.
The 747’s first flight won’t have the attention or the sex that followed the 787’s first flight. After all, the 747-8 is a cargo airplane and what’s sexy about that? It hasn’t sold well. Boeing didn’t bet the future or the company on it. But it’s a milestone just the same.
Boeing launched the 747 in the late 1960s, the first one entered service in 1970 and it remains the most recognizable airplane ever built after only the Lockheed Constellation, whose shark-like fuselage and triple tail still has a magic that has never been supplanted.
Boeing sold more than 1,400 747 “classics” over 35 years. We don’t believe the 747-8 will ever sell well and this model will be the last. We’re glad to see it get airborne.