Countdown to KC-X award

As Washington (DC) buzzes with the prospect that the Department of Defense will, at long last, announce its award for the KC-X contract before the end of this month, EADS held a press briefing February 16 to lay out its views one last time that its airplane is the best choice for the job.

Boeing made calls to editorial boards last week to make its case.

The process has dragged on so long that we couldn’t help but think of the photo below, purported to be the first air-to-air refueling.

Source: LaGuardia Airport historical photo.

The EADS press remarks are summed up in the following stories:

Seattle PI

Mobile Press-Register

Reuters

The Hill

We haven’t seen any news reports of Boeing’s editorial board visits.

 

 

 

21 Comments on “Countdown to KC-X award

  1. I watched the you-tube clip of the EADS briefing (or should I say the 14 and a half minutes of it on-line?). It was interesting, but it was also marketing. EADS feels very strongly they will win the KC-X contract. I am sure, at this point in time, Boeing does too.

    But the rumored contract award on Friday, 25 Feb. after the close of the US stock markets says something I now thing Boeing should be wary of. By now, I am sure both companies have that meeting with the USAF on their calanders.

  2. We are reading too much in my view into these remarks -given the heightened sense of suspense of which way ,it will go.
    Let us not forget that Boeing was the favorite last time; this time ,the pundits seem to go for EADS.They could be wrong again.
    Both planes are good and it is for the customer to choose what suits it best.The problem is politics on both sides.
    I would not write off Boeing as yet;their offer is not as bad as some make it out.After all ,EADS did redo their price last minute ,though Tom Enders dismissed it days earlier.That tells you , how close this is or could be.
    thanks
    sethuraman

  3. Just looking at the picture (great photo by the way). It must have been difficult to keep the hose connected. There doesn’t appear to be any slack and I imagine the handling on those biplanes weren’t very responsive.

  4. If EADS is really about to beat Boeing on price while offering a substantially bigger aircraft, I’m wondering how much profit EADS will get out this contract. Just a little margin?

  5. The President and the Department of Defence are missing the “Big Picture” here. Gunboat Diplomacy, whether by ships at sea or by ships in the air, is no longer a relevant means of protecting Americas’ shores….

    Daniel Sterling Sample
    SPACE DESIGNS
    Los Angeles

    sample.daniel@gmail.com

  6. The period photo isn’t without irony-a European -okay British-foreign designed aircraft but American built DH-4 tanker. Probably has an American engine.
    What’s old is new again.
    Full circle and all that.

  7. Rpx :
    If EADS is really about to beat Boeing on price while offering a substantially bigger aircraft, I’m wondering how much profit EADS will get out this contract. Just a little margin?

    Probably none.
    This thing could be a money losing campaign for EADS and reason for much future pain. Therefore (as German and therefore Airbus-affiliated) I have mixed feelings if this contract goes to EADS.
    I think both aircraft are excellent. The A330 obviously offers more of everything, even size and block hour fuel 😉 (I think no one doubts this).

    I still think a split buy would be a reasonable decision. It reduces the chance for another veto and might offer the USAF a good opportunity to replace their KC10A in the long run. I don’t think they will ever get funding for KC-Y, which probably is a reason the USAF favors the A330: maximum aircraft now.

    • I don’t think DOD bidding rules allow any bidder to bid at a loss, or break even position. There were times in the past this happened and once the contracts were signed the OEM then said he couldn’t build that widget for that price nd demanded a higher price.

      If EADS bids at a lose per unit just to get under Boeing’s bid, it may be rejected and the award going to Boeing at their FPR.

      • Yes, but EADS can include or exclude costs. For example the new line: they take out the entire budget of building the facilities and training the people by saying they need it for A330F.

        By that they reduce – on paper – their non recurring costs and can bid low. In reality these cost are real and only very healthy sales on the A330F would compensate for those.

        In essence: they cannot bid below their costs, but they can adjust their projected cost. If nothing helps, use exchange rate.

        But will EADS earn cash on that project: probably not.

  8. If there is to be a Boeing solution, based on past performance we are looking at 2017 as an earliest delivery, so if speed is of the essence and politics has to be considered then it has to be a split buy.
    About 90,000 jobs instead of 45,000 makes some sense when tax revenue is factored into the equation and two fleets of around 90 aircraft cannot be all that much more in terms of overall costs.
    Quite a few very successful airlines manage with considerably less than 90 aircraft of one type in their fleet structure.

  9. Two thoughts. First, AB is now saying they lowered their price in their last and final offer because, after re-consideration internal stuff, they discovered at the last minute that it was possible. This seems incredible to me since everyone knew from the beginning that it all depended on price. An alternative explanation may be that they did get a look at B’s pricing info when the AF inadvertently supplied it to both OEM’s and found out they were high.

    Second, both air framers have had real trouble delivering their tankers to date (AB to UK and Aust and B to Italy and Japan). This could mean that each will have worked thru the kinks by the time delivery to the USAf is due, and prodution will be smooth and trouble free. If this is not the case, and each company has to do lots of expensive, time consuming work to produce the plane the AF wants, this may mean significant delays no matter which company wins. This is because both will similultaneously be working on several other very expensive and resource-consuming projects (AB A350, 3230neo and A400M and B 788/9/10, and whatever they decide to do with the 737 and 773ER).

  10. Schorsch :Yes, but EADS can include or exclude costs. For example the new line: they take out the entire budget of building the facilities and training the people by saying they need it for A330F.
    By that they reduce – on paper – their non recurring costs and can bid low. In reality these cost are real and only very healthy sales on the A330F would compensate for those.
    In essence: they cannot bid below their costs, but they can adjust their projected cost. If nothing helps, use exchange rate.
    But will EADS earn cash on that project: probably not.

    Well, there are currently only about 53 orders for the A-332F, and by the time EADS has their MOB FAL facility built and assembling airplanes about half of those A-332Fs will have already been built in France. So, at best the new FAL will assemble about 200 airplanes, unless EADS sells more A-332Fs, which it is likely to do. The question is will the USAF require EADS to include design and construction costs, and employee training costs in their FPR? I don’t know the answer to that.

    Andrew :If there is to be a Boeing solution, based on past performance we are looking at 2017 as an earliest delivery, so if speed is of the essence and politics has to be considered then it has to be a split buy.About 90,000 jobs instead of 45,000 makes some sense when tax revenue is factored into the equation and two fleets of around 90 aircraft cannot be all that much more in terms of overall costs.Quite a few very successful airlines manage with considerably less than 90 aircraft of one type in their fleet structure.

    What do you think the costs to the USAF to own, maintane, and operate two new tanker types?

    • The line in Toulouse assembles sections and wingsets into complete planes for
      the full A340/A330 product range, all rather flexible.
      I don’t see hard limitations on type range for any other assembly line either.
      I do wonder about the supply path. “Ship”sets per boat like Tianjin gets ?
      Or an A340-600 based super Beluga ?
      Subassembly manufacture in the US too? Afaics A330 sales currently are supply limited and surprisingly the excess demand does not roll off onto the 767.

      Wasn’t there talk about an Airbus P2F conversion site parallel to the Mobile plant?

      • I thought the wings for the A-330/A-340 were made in the UK, along with other Airbus airplane wings, and shipped to the FALs.

        I don’t think the A-346 would make a good “Beluga” replacement, but an A-388 might be a good one for Airbus.

        I don’t recall if Airbus was going to open a P2F conversion plant in MOB, or anywhere else in the US, or not.

  11. Airbus own a 343 which is currently flight testing at least one 350XWB fuselage panel.
    That may possibly be an option.

    Sorry 135TB I have no clue regarding USAF operating costs, but they have a few aircraft fleets of relatively low numbers. B2 comes to mind.

    • Actually the B-2 fight costs per flying hour is very high due to maintenance costs, mostly on the stealth coating.

      The KC-135R (3 man crew) currently costs about $4500-$5000 per flying hour, one opf the lowest costs for combat aircraft. Trainers cost a lot less per flying hour.

      I would expect the KC-767NG to cost about $6500 per flying hour, and the A-330 tanker about #7500 per hour, mostly due to each having a defensive system, and a remote air refueling station the KC-135 and KC-10 don’t have.

      • Going from the commercial side A330 and B767 are about on par in ancillary cost
        with the balance very slightly over to Airbus. No idea about the MX requirements that defensive installations
        pose ( certain: same for both ). the fully “FBW” refueling installation with a “blocked” command station should reduce MX cost. Same for modern construction. I doubt that Boeing can push the basic 767 setup to Dreamliner / A330 levels. Time and Tech has moved on.
        ref(2000 data): http://www.icao.int/icao/en/ro/allpirg/allpirg4/wp28app.pdf

        ( apropos: With Mobile/Alabama having sea access provisioning by boat is a given )

  12. I would expect the KC-767NG to cost about $6500 per flying hour, and the A-330 tanker about #7500 per hour, mostly due to each having a defensive system, and a remote air refueling station the KC-135 and KC-10 don’t have.

    “Expected” by whom?
    How did you come up with those figures?
    Is there any source or you are just guessing?

  13. Uwe :Going from the commercial side A330 and B767 are about on par in ancillary costwith the balance very slightly over to Airbus. No idea about the MX requirements that defensive installationspose ( certain: same for both ). the fully “FBW” refueling installation with a “blocked” command station should reduce MX cost. Same for modern construction. I doubt that Boeing can push the basic 767 setup to Dreamliner / A330 levels. Time and Tech has moved on.ref(2000 data): http://www.icao.int/icao/en/ro/allpirg/allpirg4/wp28app.pdf
    ( apropos: With Mobile/Alabama having sea access provisioning by boat is a given )

    Costs per flying hours to the military is not the same as cost per flying hour to the airlines.

    Tim V :I would expect the KC-767NG to cost about $6500 per flying hour, and the A-330 tanker about #7500 per hour, mostly due to each having a defensive system, and a remote air refueling station the KC-135 and KC-10 don’t have.
    “Expected” by whom?How did you come up with those figures?Is there any source or you are just guessing?

    USAF costs per flying hours per type of aircraft are easily found. I agree we have to extrapulate the data for airplanes that do not exsit yet in a USAF configueration. But the costs are based on flying hours at an average weight, altitude, and mission profile. They include, but not limited to PDM costs, maintenance costs, spares costs, crew costs, training costs, fuel costs, ground support equipment costs, etc.

  14. The moood in Congress, at the moment, could result in postponing the selection once again. “If it won’t be ready for service until 2017 and more than half of the existing Tanker Fleet have more tan 20 years left. . . Why not wait until we can do this on Taxpayer, rather than funds borrowed from China, money”?

    By 2017 all the wars maybe over and we we won’t need Tankers or we can modify commercial B777s or, if you are a dreamer, first generation B787-XXs!

    Jim Helms

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