Northrop, EADS to skip tanker bid

Update, March 9, 7am PST:

EADS will not independently bid for the KC-X contract, Market Watch reports.

Update, 1pm PST:

Northrop will no-bid and not protest, we have confirmed. EADS is undecided whether to proceed with a bid on its own but it is unlikely. Northrop’s decision was reached over the weekend.

The USAF RFP was built to be a bid for the cheapest tanker, in the view of a source close to the competition. It was unwinnable by Northrop, it was concluded.

In the near-term, this kills the Airbus plan to build a production facility in Alabama.

As we reported Feb. 23, a DOD document pretty well indicated that the extra capability of the KC-30 wasn’t important in this round but that it would be considered in a future competition.

Northrop bid $184m in the 2007 competition it won for the KC-30 and suggests that taxpayers need to be sure Boeing comes in below this price as a sole-source bidder.

The full Northrop press release is below the jump.

Statement from Northrop Grumman on US Air Force Aerial Refueling Tanker Program

WASHINGTON, D.C. – March 8, 2010 – The following is a statement from Wes Bush, Chief Executive Officer and President of Northrop Grumman Corporation (NYSE:NOC), concerning the U.S. Air Force aerial refueling tanker program.

“After a comprehensive analysis of the final RFP, Northrop Grumman has determined that it will not submit a bid to the Department of Defense for the KC-X program. We reached this conclusion based on the structure of the source selection methodology defined in the RFP, which clearly favors Boeing’s smaller refueling tanker and does not provide adequate value recognition of the added capability of a larger tanker, precluding us from any competitive opportunity.

“Northrop Grumman fully respects the Department’s responsibility to determine the military requirements for the new tanker.  In the previous competition, Northrop Grumman was selected by the Air Force as offering the most capable tanker for the warfighter at the best value for the taxpayer.  However, the Northrop Grumman and EADS team is very disappointed that the revised source selection methodology now dramatically favors Boeing’s smaller refueling tanker.  We agree that the fundamental military requirements for the new tanker have not changed since the last competition, but the Department’s new evaluation methodology now clearly favors the smaller tanker.

“We continue to believe that Northrop Grumman’s tanker represents the best value for the military and taxpayer – a belief supported by the selection of the A330 tanker design over the Boeing design in the last five consecutive tanker competitions around the globe. Regrettably, this means that the U.S. Air Force will be operating a less capable tanker than many of our Allies in this vital mission area.

“Our prior selection by the Air Force, our firm belief that we provide the best value offering, and the hard work and commitment of the many individuals and communities on our team over many years made this a difficult decision for our company.  But we have a fiduciary responsibility to our shareholders to prudently invest our corporate resources, as do our more than 200 tanker team suppliers across the United States.  Investing further resources to submit a bid would not be acting responsibly.

“We have decided that Northrop Grumman will not protest.  While we feel we have substantial grounds to support a GAO or court ruling to overturn this revised source selection process, America’s service men and women have been forced to wait too long for new tankers.  We feel a deep responsibility to their safety and to their ability to fulfill the missions our nation calls upon them to perform.  Taking actions that would further delay the introduction of this urgent capability would also not be acting responsibly.

“We recognize that our decision likely creates a sole-source outcome for Boeing.  We call on the Department to keep in mind the economic conclusions of the prior round of bidding as it takes actions to protect the taxpayer when defining the sole-source procurement contract. In the previous round, the Air Force, through a rigorous assessment of our proposal, determined that it would pay a unit flyaway cost of approximately $184 million per tanker for the first 68 tankers, including the non-recurring development costs.  With the Department’s decision to procure a much smaller, less capable design, the taxpayer should certainly expect the bill to be much less.”

The EADS PDF statement may be download here: EADS North America KC-X Tanker statement

Update, 12n PST:

The Seattle Times reports EADS will not bid. It’s been added to the original story.

Original Post:

The Seattle Times and Reuters broke news a few minutes ago that Northrop Grumman won’t bid on the KC-X tanker program.

We’ve gotten no return calls or a no comment from our efforts to confirm. The two news agencies say an announcement will be forthcoming after the market closes today.

The Times cites NGC concern over the fixed-price aspect of the bid, rather than the technical merits. We confirmed that NGC has a protest of the Final Request for Proposal prepared, but if The Times and Reuters are correct, perhaps EADS will pick up the work and file its own protest. Reuters suggests EADS may go alone on this effort despite concerns over the RFP.

A straight-forward EADS submission will only aggravate the political thumping by Boeing supporters. The final World Trade Organization report on illegal subsidies to Airbus is expected shortly, and there will be no pretense of this being a US-based KC-30.

From previous conversations, we know that EADS favors going forward with a bid. Costs are already sunk; EADS is building the KC-30 MRTT for Australia, Britain and other countries; and EADS has a major strategy to increase its US defenses business.

42 Comments on “Northrop, EADS to skip tanker bid

  1. NG made a great decision. Bad for the taxpayers, bad for the USAF, but great for Boeing, as it allows them to continue ripping off the USAF, and they have gotten what they have wanted all along.

    The is a very prophetic dramatization of precisely what is wrong with the DoD procurement process, and especially as that pertains to the USAF. I personally do not believe that agency is capable of writing an unbiased specification, and running a “clean” procurement. If past performance accounted for anything, then Boeing would be disqualified, which is what should have happened when they were caught with their hands in the tanker cookie jar a few years back.

    • Mr. Hall’s criticisms of the DOD’s procurment process over the KC-X bid are unfounded.

      The simple fact is that the 767 and A330 are very different aircraft and an honest contest will inevitably favor one or the other. Had the Air Force wanted a larger more capable Tanker Boeing would have bid a 777-200F based versions which is bigger and more capable than the A330. What the Air Force said they wanted was a KC-135 replacment and in the commercial world today the aircraft that best fits that profile is the 767-200. The A330 would have been more capable yes, but it would have also been much costlier to operate (anda lot of hours are flown for training etc where the full capabilities of even the KC-135 aren’t used) and required a major investment in infrastrucure to support its larger size. Boeing was simply lucky that they had an aircraft on the shelf which best fit this role.

      • the USAF calls it a “Tanker Modernization Program”. How can it be that the requirements for an Modernization effort can be met by an 50 y/o a/c with the addition of a refueling receptacle.

      • Did you know Air Force also got a request for flight simulators?
        Did you know that even a costlier aircraft could be more efficient because you have to use just 2 aircrafts instead of 3 (FEV)?
        Did you know that almost all runways at US Air Force bases can handle the even heavier C-17?
        And last time Boeing offered an aircraft from several shelves.
        The 777 was never an option due to the runway length restrictions and price.
        With a KC-30 Air Force could have condensed the tanker fleet to just one type in future.

  2. So Tom – you have no problem using $$$ borrowed from China and to be paid by U.S taxpayers plus interest to be funneled to EADS/Airbus to help their JOBS program ?

    Even though they have already been found Epecifically guilty of excessive subsidies in accordance with GATT92?

    Even though they have a poor reputation for cost of maintenance on the A300 series, so bad they had to give special ‘ money back ‘ or no cost parts and rework items. ?

    Even though their track record for bribes and cost overruns are several times that of Boeing

    Even though their stellar performance on the Turboprop Cargo plane is the new poster child for cost overruns and mis- management ?

    For which they refused to buy any but EU made engines. No U.S parts thank you?

    Now about past performance on tankers, how is it that a 50 year old design is still flying ?

    • Those are all great talking points Don. Can you point to where any of that was something the DoD agreed was part of the evaluation?

      And if you want to talk about mismanagement, why go all the to an EADS aircraft unrelated to tankers. Let’s just look at how well Boeing did with the Japanese and Italian tankers.

      Airbus was supplying A330s with modifications. Something they have a great track record at building.

      • About the A300 series – as I recall, av week had a series of articles describing the ‘ tgurn it back afgter a year or two in service if you dont like it – and Airbus underwriting the full cost of maintainence for a few years plus a discount on many major parts — but despite that which I’m not going tom spend time looking up .. here is another related comment – admittedly biased . .

        http://www.seattlepi.com/business/80048_air26.shtml

        admittedly a biased comment- but its a good bet he had the data to back up his claims . .

        . . .”Don’t fall for this four-engine stuff,” said Randy Baseler, vice president of marketing for Boeing Commercial Airplanes.

        He said airlines don’t take chances, and if one engine goes on a four-engine plane, it diverts to the nearest airport.

        About 90 percent of all diversions, be they on four- or two-engine planes, are not because of engine problems, he said. A sick passenger is often the reason a plane is diverted.

        He went on to say that all available data show that the A340 has had twice as many diversions and turnbacks as the 777.

        It also has had twice as many dispatch delays at the airport, he said.

        “What that means as a passenger is that you should take the 777 because there is a better chance of getting to where you ant to go and a better chance of departure.” . .

  3. Lets hope that he end of this ten years sordid history will come to a satisfactory end.

    After various scandals, protests, rebidding, etc the Air Force and Secretary Gates issued an RFP that indicated the Air Force requirement. Nothing larger nor smaller, bigger or taller…just the basic requirements.

    Weighing all the considerations…political, financial, industrial, military and Congressional, a process is coming to a conclusion. There will be cries of unfairness, etc, but it is time to cease the lobbying and extralegal efforts and settle on a result that is reasonable, and will provide a vehicle that will serve the needs of the Client bidder.

    Argumentaion and disputation could go on forever. It is time to move on

  4. Under the circumstances NG’s press release is most certainly not the most eloquent it could have mustered, but it has to consider the likely damage to contracts both current & pending by truly speaking out.

    As the rest of the world has identified the facts are that local defence sourcing is not a long term gain but more commonly a short term fix the re-jiged RFP blatently reflects this fact in alienating the more worthy aircraft.

    The area where NG facts ring true is based on the USAF’s future changing IFR role is where it rightly identifies that the last five international competitions were gains for the A330 Now with the almost certain acceptance of the Boeing airframe this puts the USAF in the embarressing position where it’s allies (allbeit in small numbers) will be operating the more capable tanker.

    In the final analysis only the AF loses.

  5. I’m not sure it will be a good thing for Boeing shareholders. Could be but in that case Obama would have to justify that to the taxpayers.
    That’s ironic : actually the Chinese are loaning money to the US to subsidize a company which sells military products to Taïwan.

  6. Responding to Vanguard: Is it possible that the requirements of the Nations ordering the A330 were different than the needs of the USAF.

    This first tranch of planes are to be used as Tankers and not for freighters or ancillary needs. The A330 has wider range of usage and those countries with smaller air forces may need the duplicative purposes.

    Your conclusion is therefore not necessarily accurate

  7. I think it’s a good decision by NG. It would have been a total waste of time to bid on this RFP. No way should EADS go it alone. Forget it. Just concentrate on the existing backlog and deliver the A330 MRTT to RAAF. Take it forward from there. EADS is overstretched as it is.
    It is also probably safe to say that Boeing will not find it an easy development. Time will tell.
    As for the DON S post, it is of course complete nonsense but whatever makes you happy.

    • UKair said …. As for the DON S post, it is of course complete nonsense but whatever makes you happy…

      +++

      Care to be more specific – or just trying to deflect the issue ?

      • Why should he be more specific? while you simply spout gross exaggerations, unfounded allegations and downright lies.

        exaggerations: “poor reputation for cost of maintenance on the A300 series”
        so you infer a reputation from the first effort by an fledgling multinational cooperation -airbus- to break into the heavily entranced US held aerospace market more than 30 years ago and claim it holds any relation to the operational reality of a company -EADS- today

        unfounded allegations: “Even though their track record for bribes and cost overruns are several times that of Boeing”
        I’d say they’re on par, but that’s only a gut feeling – do you have any substantiation for your claim?

        downright lies: “For which they refused to buy any but EU made engines. No U.S parts thank you”
        It was not EADS that made the engine choice.

        Now about past performance on tankers, how is it that a 50 year old design is still flying?
        it comes from using them only 350 hours a year, having replaced the complete skin? of the plane and changing the engines a couple of times.

      • EADS had the A400M EuroProp engines jammed down their throats by the likes of French President Jacques Chirac. Yet, with all their experience and history, EADS still signed the contract. They might just have seen this as their greatest power play opportunity, but in the end they didn’t get much more.

      • OK, let me be more specific. The *whole* of your post in nonsense, although credit is due for providing a good laugh. Let’s see:
        – “U.S taxpayers plus interest to be funneled to EADS/Airbus to help their JOBS program”
        Talk about jobs programme. The is a good article on leeham with a linked video, which perhaps Scott could point to, where Dicks and co., were standing in line publically pouring s*** on EADS and then one of them let it slip… ‘This is an American jobs programme’. So what was all that stuff about competition?
        – “found Epecifically guilty of excessive subsidies in accordance with GATT92?”
        Being an alleged av week reader you would know that what was delivered last year, was a preliminary judgement, they have not been found guilty of anything yet. The full report will be issued sometime before the summer, followed by the ‘Boeing’ case.
        – “Even though their track record for bribes and cost overruns are several times that of Boeing”
        Let’s see, in the context of a tanker competition, you are claiming EADS is corrupt and has a record of bribes. Now there is a good joke.
        – “For which they refused to buy any but EU made engines. No U.S parts thank you?”
        Can you manage an online translation?
        http://www.welt.de/die-welt/wirtschaft/article6445655/Es-wird-eine-Belastung-bleiben.html
        “I may remind as example only of it that the engines against our will to a consortium out of European companies went, purely from industrialpolitical criteria. This decision alone led to more than one year delay.”
        – “Now about past performance on tankers, how is it that a 50 year old design is still flying ?”
        Because on average it flies between 350 to 710 hours per year.

        After seeing you get your knickers in horrible twist on the Air Transat A330 incident, you clearly have very little to contribute.

  8. What a great parting shot by Wes Bush. 20 percent (++) less capability across the board than the A330MRTT, so the GAO (representing the taxpayers) should demand that sole sourced KC-767s should cost less than $150 million per unit.

  9. So far the boom equipped A-330 MRTT has sold a grand total of only 14 airframes. 5 to Austrailia , 6 to Saudi Arabia, and 3 to the UAE. The KC-767 by contrast will shortly have nearly 190 orders, 178 USAF + 4 for Japan and 4 for Italy. This means once the deal is complete with the USAF the KC-767 will have over 13x the number of orders as it’s competitor and will be the World’s Number 1 Next Generation tanker. The A330 MRTT will effectively become a footnote and the nations that purchased it will be worried about getting support for such a limited production aircraft, not bragging that their plane carries a little more gas than the USAF aircraft.

    • I think i’m going to take this comment as a sarcastic one, otherwise i’d be afraid to see real people thinking this way.

      Heck, a plane that has a working boom but only 14 planes on order is a footnote compared to one that can’t make it work but has a bucketload of political orders 🙂

  10. Bob,

    The boeing boom has worked fine for years and first passed gas in 2005. Boeing invented the flying boom and Boeing booms have been passing fuel for over 60 years. The EADS boom only passed gas for the first time a few months ago, I’ll just chalk your comment up to ignorance ; )

    • John, You might want to go learn more about the competing aircraft before you jump in here. The boom Boeing is proposing is completely different than what has been flying for 60 years. You make it sound like all there is to it is sending gas down a tube.

      Also, the EADS boom passed gas a couple years ago and it’s been passing gas to receivers for a heck of a lot longer than ‘a few months’. You’re way off the mark.

      Using your logic on booms, I have a 1940s Ford Coupe that has been running for 60 years. I also have a 2005 Ford F-150 King Cab. You would say that clearly the Ford Coupe is the better, more capable vehicle because it’s been running for 60 years and the F-150 has only been running for 5!

      Many people here actually know what they are talking about. Coming on to this web site of all places spouting the same Boeing and union talking points won’t cut it here. There’s room for honest disagreement and discussion, but you have to have a basis of knowledge to have that discussion.

      • . . .Also, the EADS boom passed gas a couple years ago and it’s been passing gas to receivers for a heck of a lot longer than ‘a few months’. You’re way off the mark. . . .

        +++
        That is NOT the boom under discussion

        passing gas since when ?????

        http://www.fleetbuzzeditorial.com/2009/11/02/airbus-a330mrtt/

        November 2nd, 2009

        Airbus A330 MRTT Finally Passes Fuel

        Further Tests Remain Uncertain

        Northrop Grumman Cries “Wolf”

        After scathing criticism about the lack of progress on its tanker program, EADS announced that the model had for the first time successfully transferred fuel to an F-16 through its Aerial Refueling Boom System (ARBS) from a Royal Australian Air Force (RAAF) A330 MRTT.

        +++

      • Willtop,

        Boeing has built several thousand refueling booms. Generation VI means just that their 6th generation boom. I know perfectly well what I am talking about and Boeing has far more experience in boom design than EADS could ever hope to gain. Besides the boom was never an issue for Boeing, the boom they designed for the KC-767 worked on schedule and as promised unlike the EADS designed boom for the KC-30 (this is understandable given that it’s EADS first boom). Also, the boom used on the A310 test plane was not a production boom, it was a handbuilt single-off prototype and did not qualify as a production boom. EADS first production spec boom, used on the Australian KC-30 did not pass gas until a few months ago as stated. So you are clearly wrong on this issue.

        The real issue Boeing had was with their drouge refueling system. That is more than a fair target to go after, but making nonsensical remarks about Boeing’s refueling boom, when Boeing has probalby forgotten more about building refueling booms than EADS currently knows is not a very smart remark. Building a refueling boom that meets the current requirements and current schedule is hardly in doubt for Boeing, their past achievements and expertise in this area is unrivaled.

        However, that said going after other aspects of the nextgen KC-767 and in particular the WARPS and the centerline drogue would have been a more than reasonable and fair line of questioning given Boeing’s problems with the drogues on the Italian KC-767s.

  11. NG concluded that the fixed price risk far outweighed the opportunity of making any real money. There was only downside. NG is the only one of the three parties primarily motivated by the financial opportunity of the tanker contract on its own merit.

    The likelihood of meaningful profit is not the driving factor for either Boeing or EADS. EADS would be content to bid at a loss in order to build a final assembly facility in the US.

    Boeing would bid at a loss to keep EADS out of the US. NG doesn’t have a dog in that fight.

    With the change of the contracting vehicle to fixed price, there is little or no opportunity to get well in the future.

    And finally, NG’s press release about the unfairness of it all was primarily directed to provide cover for the Alabama congressional delegation. The recent NG change in management has realigned their strategy from revenue growth and market share to risk management and profit margin growth.

    The Alabama congressional delegation now has to climb back from their Mobile tanker or bust limb. Unfairness is an easier sell than we just changed our mind.

  12. Mr Don, stop the rednecking. get an education.
    I would like to direct your attention to:
    http://www.airbus.com/index.php?id=772

    ARBS ( Boom and Operator Console ) have been flying on the A310MRTT for quite some time and with
    rather satisfying results at that.

    Airbus initially entered the North American market with
    a “no risk” offer to Frank Borman of Eastern Airlines
    for 4 A300. The planes were so bad that Airbus only managed to conquer 50% of the worldwide market
    in the next decades 😉

  13. I think it is a wise decision given by N.G – as well as prudent. It has been rather annoying trying to sort through relevant comments.

    Firstly – Bidding has not yet closed, and Boeing has not submitted it’s final bid.

    Source selection is largely irrelevant from the Rfp, whether or not your part comes from China or not does not bear on the future contract.

    Neither does selective partisan hackery about which planes a passenger should, in theory travel on hold relevance in any selection criteria.

    Secondly, the A-330 based platform & common variant has won the confidence on various tendering processes worldwide. It would indicative that those nations have complete confidence in the product to deliver what they require. (Ironically many of them more worried about sending there personnel into harms way than the U.S – so much for the safety argument)

    Under the terms of the Rfo, what the nation requires – that the USAF has determined what it requires, is the reason Northrop Grumman has not bid. What all taxpayers should be considerably worried about, is whether politics did play a part in the re-write – given a company going from competing & winning a contract, to a company not even competing. There is a third degree of change in there, Competing and winning, to feeling there is a chance in competing, and doing so, to not doing so at all.

    Arguments based on through life operating costs are moot. The U.S has near infinite funding for operations. Cost of operation is also a feature in tendering processes that HAVE selected the competition, that have a lot less money to go around.

  14. Europa is not amused:
    “Germany urges U.S. to rethink air tanker contract”
    http://www.reuters.com/article/idUSBAT00521520100309?type=marketsNews
    “France warns US of ‘implications’ of Airbus cancellation”
    http://www.expatica.com/fr/news/french-rss-news/france-warns-us-of-implications-of-airbus-cancellation_29678.html
    “EU warns US against protectionism in Pentagon deal”
    http://www.google.com/hostednews/ap/article/ALeqM5hI0l7LaH-ew87Wg0V64pbxOt0D-QD9EB46RG0

    • Just heard it on the news here.

      Could that go towards another WTO litigation?
      ( and when is judgement on the EU->787 case expected )

      • 1. WTO does not have and never will have jurisdiction over or anything else to do with military procurement.

        2. Got to love the EU sour grapes…… Let’t take a look at their latest big-ticket airframes…. a400m, eurofighter, rafale, MRTT – models of transatlantic cooperation and open bidding, eh?

        3. Interesting threats for the so called “American’ tanker from EADS/NG…. if there were so many US jobs and content, why are countries like France soooo upset and threatening retaliation? So will the French give Boeing the chance to bid on their tanker replacement?

    • I hope the EU politicians are going to stop being headline providers. The award is gone to Boeing and nothing will change. My advice to them is to get on with other things.

  15. It’s always ugly to short out a government tender which initially was meant to create competition.
    But then, who cares ? The only one who might lose on this is the US taxpayer, everyone else will be happy with Northrop-Grumman’s decision to pull out ahead of time.
    Yesterday, Dr. Thomas Enders, the CEO of Airbus confirmed EADS will not proceed on this on its own.
    So the only bidder (and winner) is Boeing.
    I was against Airbus taking part in this tender from the start, and I’m very happy about early death of this contest.
    To me it is very questionable, wether Boeing ever will be happy with this job. Time will tell, and soon.

  16. For those of you having followed this story over the years and in the blogs, it becomes apparent that there was a bidding contest that was deeply embedded in many other issues: political, international, labor, military , industrial, etc all covered by varying degrees of understanding by the press.

    EADS wished to make inroads into the American Military market and establish a production center in the US. Boeing was battling an unfortunate legacy that created a backlash in the military.

    The Pentagon was charged with sorting these issues out and drafting an RFP and selective process that would make the choice definitive and efficient.

    Combining all these countervailing pressures, a process was put in place that has created a result that ended up with a single source bidder.
    What is most important is that the USAF gets the plane that it set specifications for.

    The rest will be recriminations, argumentaion and rationalizations. The competition will continue on another field with other bids with the same influence players intruding into the process. That is the process.

  17. I think the less good plane and the worse value plane has won it. Also, I don’t think Northrop and EADS were treated well by the process. Finally, an opportunity was lost to introduce a new player to the US aerospace industry

    But in the circumstances, it’s the best possible result because it removes all the confusion. The way’s clear for the Air Force to get its new tanker.

    • FF2 and others – re less good plane …. yada yada and worst value . . etc

      Why not read the GAO report on the reversal of Northrop bid ? For example from the Boeing ( no doubt biased in wording – but factual )

      Only the Boeing KC-767 met all
      mandatory mission requirements.
      Northrop Grumman/EADS did not establish
      that the KC-30 met the requirement
      to refuel “all current U.S. Air Force
      fixed-wing tanker-compatible receiver
      aircraft,” a key performance measure.

      ++++

      Boeing’s proposal was evaluated
      as “satisfying significantly more”
      technical requirements than Northrop
      Grumman/EADS.

      ++++

      Only Boeing satisfied the
      “material” requirement for initial depot
      maintenance. Northrop Grumman/
      EADS “explicitly” refused to meet this
      requirement. According to the GAO,
      this alone should have made them
      ineligible for the contract.

      Of course france is known for its cheese and wine er WHINE

      and now comes the trade war and protectionist whine…

      How about the engines on the 400M ? and the slight cost overrun ?

      • Did you really read the GAO report?
        Nowhere you can something about what mandatory mission requirements Boeing’s aircraft did meet and which not.

        For the Boeing proposal nothing was real. Nice CGI animations and figures on paper. Did Boeing offered any certified airspeeds for the KC-767AT?

        -+-+-+-+-
        “Boeing’s proposal was evaluated as “satisfying significantly more” technical requirements”

        “Moreover, the record does not show any consideration by the SSAC or SSA of the fact that Boeing’s proposal was evaluated as satisfying significantly more SRD requirements than Northrop Grumman’s.” (GAO)

        Something like more plugs on the main cargo bay and such things which are less important to the main mission – refueling.

        -+-+-+-+-
        “Only Boeing satisfied the “material” requirement for initial depot maintenance. “

        “The SSAC concluded that this was an “administrative documentation oversight” because Northrop Grumman had promised to provide the required services and its “cost/schedule documentation is consistent with standing up depot capability within two years of delivery of the first full-rate production aircraft.” (GAO)

        -+-+-+-+-
        “and now comes the trade war and protectionist whine…”

        Well, wings for A330 are produced in the UK. EADS headquarters is in the Netherlands. Both want some F-35 maybe now some less.

        -+-+-+-+-
        “How about the engines on the 400M ?”
        Running

        -+-+-+-+-
        “and the slight cost overrun ?”
        About 10 %.

        Do you remember cost overrun for C-17?

        Fly away unit price for KC-30 was about $184 million per tanker.
        Expect the offer by Boeing.

  18. re By: MHalblaub on March 9, 2010
    at 2:46 pm

    ” For the Boeing proposal nothing was real. Nice CGI animations and figures on paper. Did Boeing offered any certified airspeeds for the KC-767AT? ”

    Golly – you mean you were present in the final briefings and submission of the BA proposal AND the Northrop-EADS proposals a few years ago ?

    And as to reading the GAO report ( public version), Note that I had posted the link BEFORE your post.

    As to the certified airspeed issue ..

    start on page 38 re first mention of airspeed – and on page 39 we find . . .With regard to the overrun issue, the record shows that Northrop Grumman was twice informed by the Air Force during discussions that the firm’s initially identified maximum operational airspeed of [Deleted] Knots Indicated Air Speed (KIAS) would not be sufficient under current Air Force overrun procedures to achieve required overrun speeds of [Deleted] KIAS for various fighter aircraft, including the [Deleted], or [Deleted] KIAS for the [Deleted].56 See AR, Tab 184, EN NPG-MC1-003, at 2; EN NPG-MC1-003a, at 1-2. Ultimately, Northrop Grumman informed the Air Force that a [Deleted] limited the aircraft’s operational speed, but that Northrop Grumman proposed to include a [Deleted] to achieve the necessary overrun speed.57 See id., Northrop Grumman Response to EN NPG-MC1-003a, at 2-7. The Air Force accepted Northrop Grumman’s proposed solution as satisfying this KPP threshold. HT at 628. . . .

    Then discussion goes on for about 8 pages. it is obvious that GAO did not accept Airbust /EADS explanation as to why/how they could change deleted to meet airspeed parameters as defined by FAA and as certified by FAA and RFP.

    That that was considered a deficiency by GAO and NOT a deficiency by Boeing defeats your attempts to spin things re ‘ Boeing offering certified airspeeds ( which meet the RFP )

    GET over it !

    • Your statement was
      “Only the Boeing KC-767 met all mandatory mission requirements.”

      and I said nowhere in the report by GAO you can find a analysis about the offer by Boeing.

      „Boeing offering certified airspeeds“
      The KC-767AT isn’t up in the air right now.
      Nobody can offer a FAA certified max airspeed for a non exiting aircraft.

      Do you remember the problems Boeing got with the Italian KC-767? Boeing just wanted to put some pods under the wings and –Oops! Was there a possibility to encounter another “Oops” due to a different type of flaps? GAO nowhere looked at Boeing meeting any requirement because Boeing didn’t get the contract.

      How many requirements will the KC-767NewGen fulfill in 2020?
      2018 is my guess for IOC.

  19. ” Being an alleged av week reader you would know that what was delivered last year, was a preliminary judgement, they have not been found guilty of anything yet. The full report will be issued sometime before the summer, followed by the ‘Boeing’ case. ”

    Groooann – the only issue is the amount –

    9 years ago, as part of a major union effort to file a Countervailing Duties petition, I put together the numerical guts. It was to be filed the week of 911. After a 3 month delay, when we were again ready to file – Boeing subverted the union executive director and with the ” help ” of Rudy de leon, claimed that such petition would hose the then Tanker lease issue. Which was totally false by the way. At that time, from some VERY high administration levels, the extra subsidy amount would have resulted in about a 10 to 15 percent duty on all airbust aircraft imported into the U.S.

    As to how the real lease deal got started – it was thru the efforts of a very close friend of mine – and purpose at that time was JOBS.

    http://web.archive.org/web/20040401111615/http://www.kingcountyjournal.com/sited/story/html/159134

    The link below is just a small part of the story

    http://www.washingtonpost.com/ac2/wp-dyn/A21584-2003Oct26?language=printer

    What we did not know at the time was the major screw ups by Boeing . As the deal later collapsed, it became obvious that the reason for BA interference was due to the requirement to furnish actual cost data for BA planes versus Airbust planes to determine the amount of harm- and at the same time BA was trying to hose Uncle Sam re tanker costs. As to corruption and bribes, The deal with fed-ex and Airbus in the late 90’s was but one example.

    • Dawn,
      thanks for those links. Now everybody knows that Boeing’s bid is 124.5 million per tanker. A further saving of $25,5 million from the cost that OV-99 had estimated.

      McCain would be proud of you!!

  20. Don S, I don’t believe the GAO commented one way or the other on which plane was better. Their complaint was that the Airforce didn’t follow the rules in their selection process. When I say the A330 is a better tanker, that’s just my opinion, which of course you may totally disagree with. The Airforce was of the same mind, even if they didn’t follow the process.

    The important thing now is for the Airforce to extract itself from the mess that it was partially (but only partially) responsible for. This I believe it will do with an unchallenged sole source purchase from Boeing.

    Unfortunately the collateral damage includes a missed opportunity for the US to significantly boost its aerospace industry. Winning this competition would have been the start of a major investment in the US by the world’s other big aerospace company. It would compensate for Boeing’s trend towards outsourcing abroad.

    Now the US and its military doesn’t owe foreign based companies a living and not all Airbus planes are better than Boeing ones. But this one is – not just in my estimation, but also the US Airforce, the Australians etc etc. An environment where it could have won would enable the sort of investment I am talking about.

    Unfortunately the environment was poisonous, where the Alabama operation was seen as low value and a European Trojan Horse in the US market. But instead of saying “Not enough investment, go away!”, why not say “Not enough investment, give us more”? EADS was anxious to develop its presence in the US and would likely be amenable to negotiations on investment levels. And if you can’t strike a deal then you wouldn’t have lost anything.

    • “Pork Barrel Politics”
      It is about lossy distribution of money.

      It is not about synergetic creation of
      brand new or added value.

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