Air Force shouldn’t proceed with production rate decision, GAO said

  •  A chemical mislabeled and fueled into the first KC-46A means a delay of one month of its first flight, the USAF said yesterday.

Aug. 18, 2015, (c) Leeham Co. The US Air Force should not proceed with a decision giving Boeing the go-ahead for low-rate production on the KC-46A tanker “before it has adequate knowledge that

Click on image to enlarge.

the KC-46A can perform its aerial refueling mission,” the Government Accountability Office said in an April report.

This was before the latest delays, the impact of which remains undetermined, resulting from Boeing inserting the wrong chemical through a test KC-46A’s fueling system. The Seattle Times reported a vendor mislabeled the chemical. Boeing had already eaten up development margin in the timeline. When the GAO issued its April report, one of its periodic reviews of the program, the flight testing schedule had already been compressed to a mere three months before the low-rate production decision is due in October.

The flight testing is already running eight months behind schedule.

“Boeing is at risk of not meeting the entrance criteria needed to support the projected October 2015 low-rate production decision,” the GAO wrote in April, “and will have less knowledge about the reliability of the aircraft than originally planned. The small schedule margin that was built into the program has eroded….”

KC46A_767 Conversion

Click on image to enlarge. Source: GAO report, April 2015.

“…[T]he department must be case not to hold the low-rate production decision and award a production contract before it has adequate knowledge that the KC-46A can perform its aerial refueling mission,” the GAO wrote.

In the April GAO report, the agency noted that Boeing had completed only 3.5 hours of flight testing during one test flight of the 767-2C, the pre-cursor of the first actual KC-46A, fully equipped with the fueling system. The KC-46A still hasn’t flown–in part due to the chemical issues cited above. By then, the program should have had 400 hours of flight testing. A total of 2,400 hours of flight testing was originally planned by the time the low-rate production decision was due, originally this month.

KC46 schedule changes April 2015

Click on image to enlarge. Source: GAO report, April 2015.

“Under the revised schedule, Boeing will now complete roughly 22% of the development flight testing prior to the low-rate production decision compared to its original plan of 66 percent, providing DOD [the Department of Defense] with less flight test knowledge at this program milestone,” the GAO wrote in April, before the latest incident. “In addition, only three months will be on a KC-46 prior to the decision compared to the original plan of 13 months.”

The GAO wrote that Boeing originally would have completed 36 months of flight testing using four developmental aircraft before the low-rate production decision. Only the 767-2C has flown to date.

The original plan would have also included aerial refueling demonstration flights that are “entrance criteria.” “During these flights, Boeing and the Air Force must demonstrate that the KC-46A can refuel five different receiver aircraft, as well as function as a receiver aircraft in a refueling operation,” the GAO wrote.

Boeing won the tanker competition after 10 years, one deal (the leasing of 100 KC-767s to the USAF) vitiated by Congress and the second, an award to Northrop Grumman and EADS for the Airbus KC-330 MRTT, thrown out because the USAF changed the rules of the game without tellling Boeing. Boeing won the third round on a Technically Acceptable, Lowest Price competition in which its bid was 10% less than the EADS submission (Northrop dropped out of the third round).

“EADS,” as the Airbus parent was then known, “made two bold claims during the competition. We said that if we won we would build a manufacturing facility to produce planes in Alabama, and we said that if we won we’d be refueling U.S. aircraft sooner than the 767 ever could. We lost, but we’ve still managed to do the two things we said would only happen if we won, an Airbus Group spokesman wrote to Leeham News in an email Aug. 11. “A330 MRTTs began refueling U.S. combat aircraft in August 2014, with the RAF. The Royal Australian Air Force followed shortly thereafter (September or October I believe). Other allies have followed suit.”

Washington State’s Fairchild Air Force Base bypassed a second time

Separately, last April the USAF announced its second round of potential bases for the early groups of the operational KC-46A squadrons. For the second time, Fairchild Air Force Base in Spokane (WA) was bypassed. Spokane has long been the base for the Boeing KC-135 tankers.

Washington State is where the KC-46A is being assembled. The State’s Congressional delegation waged an aggressive campaign on Boeing’s behalf to win the tanker contract.

The Air Force named Tinker Air Force Base, Oklahoma; Seymour-Johnson AFB, North Carolina; Westover Air Reserve Base, Massachusetts; and Grissom ARB, Indiana are candidate bases for the first Air Force Reserve-led KC-46A Pegasus locations.

“The Reserve-led KC-46A preferred and reasonable alternatives and begin the Environmental Impact Analysis Process (EIAP) in the summer of 2015,” reported the US Air Force.

The USAF told Leeham News yesterday that “the reserve candidate basing decision will be announced in the next few months. Active duty candidate bases will be considered again in the future. McConnell Air Force Base, KS, will be the first active duty-led Pegasus main operating base and will begin receiving aircraft in fiscal year 2016. Following rounds of KC-46A basing will remain largely consistent with previous rounds and criteria will be determined and announced at least three years prior to aircraft arrival. By 2028, the Air Force expects to base KC-46As at one formal training unit and up to 10 main operating bases. Under current plans, tanker units not selected for Pegasus basing will continue to perform their current missions. The Air Force uses its strategic basing process when making basing decisions. Each decision takes an “enterprise-wide look” as it evaluates potential basing locations.”

 

 

 

 

 

 

39 Comments on “Air Force shouldn’t proceed with production rate decision, GAO said

  1. Hmm,

    Boeing must perform on the new KC-46 tanker programme, the US Air Force is warning the company as the aircraft enters its preliminary design review (PDR). Otherwise the service could walk away.

    “We could buy more KC-46s or – make no mistake about it – if Boeing doesn’t perform, we’ll just start another competition,” says Maj Gen Christopher Bogdan, the USAF’s KC-46 programme executive officer.

    The KC-46 represents the first step in the USAF’s plans to replace its ageing fleet of Boeing KC-135 tankers

    The KC-46 effort is the first phase of a three-step programme to replace a geriatric fleet of 416 Boeing KC-135 tankers that have been flying since the Eisenhower administration.

    The USAF wants a total of 179 KC-46 tankers eventually, but initially Boeing is obligated to deliver the first batch of 18 combat-ready KC-46As by August 2017.
    The first production aircraft deliveries are expected in early 2016, Bogdan says.
    “If they don’t give us the 18 airplanes by August of 2017, I have the option to withhold payments [and] I have the option not to approve any of the further production options,” Bogdan says.

    http://www.flightglobal.com/Features/tankers-special-report/Boeing-KC-46/

  2. Boy, it’s a good job Boeing has all that tanker experience they kept mentioning, otherwise we can only imagine what a mess this program would be.

  3. Well a big “I TOLD YOU SO” from EADS/Airbus – I wonder how many in Congress are now shaking in their boots and praying that Boeing can pull this one out of the fire.

    I hope Airbus has some land ready to build its US factory sooner rather than later.

    • @John Fenech

      I don’t think so about the “I told you so”. Imagine the beating Airbus/EADS would rightfully take because the boom fell off the jet? Or an aircraft crashed on takeoff due to “wrong software upload”?

      So, no, don’t get your hopes up. And this was a vendor problem, not a Boeing one. Boeing jacked up a few things but this was vendor sabotage, not a Boeing cock-up.

      • “Vendor sabotage”!

        Yeah, right. For all those that believe this incorrectly labeled vendor chemical story, I have a bridge in Manhattan to sell you.

        Maybe it really is such an unbelievably stupid mix-up, but am I really the only one here who looks at this whole story with raised eyebrows!?

        What are the odds of mislabeling a corrosive chemical and sending it off to one of the biggest companies in the world who believes it is going to be what? Why don’t they tell us what the chemical was supposed to be or at least what it is supposed to do? Is this really top secret?

        I am not saying that I don’t believe this but on the other hand, I cannot honestly say that I do believe it either.

      • @Neutron73

        Boeing is so far behind on the KC-46 that inserting the wrong chemical when testing KC-46A’s fueling system probably won’t make much of a difference to what already seems to be a critically impaired programme.

        However, the big elephant in the room is what would happen if Boeing is incapable of delivering 18 fully operational KC-46s by August 2017. Would USAF simply walk away and look at other alternatives?

        From my initial link:

        “We’re going to have over 60% of all of our flight-testing completed before we ever give the permission to start production,” Bogdan says. “That’s an awful lot of testing compared to most other programmes.”

        “It’s an event-driven requirement,” Bogdan says. “If they don’t get that flight-testing done and are successful, I won’t give them permission to start production.”

      • [i]Boeing jacked up a few things but this was vendor sabotage, not a Boeing cock-up.[/i]

        Do you have any proof for sabotage? I’m sure Boeing would love for you to share it with them, as well.
        Also, you realise that the schedule was eight months behind schedule before this latest mishap? If it wasn’t, we wouldn’t in all likelihood ever even have heard about that “wrong chemical” story, because Boeing wouldn’t have needed to provide an explanation for the additional delay this incurred.

        • You guys are taking the “sabotage” way too literally……

          Would it be better if I say “Vendor screwed them”?

          Yeesh……how about reading the rest of the post. Inartfully worded yes, but anyone expecting Congress to rebid at this point is fooling themselves. Plus, Boeing is eating all the costs, so as a taxpayer, I’m not concerned about the screw-up at all. I’m not paying for it…

          • Eating all the costs ? Thats not they way it works once you get to sole bid status.

          • Boeing will eat all the cost, right up to when the tome comes to price the 179 follow up orders… Then they’ll be spitting it out again.

            They do it with the 787, just park the costs in some account, and tack that cost onto the future production.

          • I think the price for the full order has been made, with known amounts for inflation etc.
            It would be too easy to bid low for development and first batch and when faced with no competition jack up the price for the rest of program.
            It could end up like the 787, the first 100 or so costing Boeing more than they get from the AF?

  4. “Click on image to enlarge” doesn’t work with the first image, “Features and Capabilities.”

  5. Put it in context. The F-35 program is so egregiously incompetent that other defense procurements with problems will sail through with less attention. Boeing will sort out the the air tanker, eventually.

  6. Is that really true/confirmed about the MRTT already having refueled U.S. combat aircraft?

    Not that that would make all that much difference. Boeing has already delivered previous versions of the KC767 which have or probably could, refuel U.S. combat aircraft.

    • If Boeing had ‘previous versions’ of the KC767, why are they having a hell of a problem with this one. My impression is that essentially there is very little carried over from those conversions, which had poor program executions as well.
      “Under its December 2002 contract with Boeing, launch KC-767 customer Italy had expected to take delivery of its four aircraft between 2005 and early 2008, but this schedule has slipped significantly due to various development issues encountered during flight testing of the modified widebody.” -Flightglobal.

      • Considering the execution on the previous tankers and the Wedgetail I would say its all carried over swimmingly.

  7. “However, the big elephant in the room is what would happen if Boeing is incapable of delivering 18 fully operational KC-46s by August 2017”

    They won’t. And everyone knows, it’s just window dressing.

    Congress will step in to protect the flag & probably blame the USAF again, somehow. Soldiers will obey.

    • Well, it may look as if Boeing is not performing very well on the KC-46. Window dressing or not, USAF has the option to severly curtail the number of KC-46s that’s currently planned to eventually be procured (i.e. 179 units). If, for example, they would decide to order no more than, say, 100 KC-46s – just in order to placate Congress – then, deciding at the same time to terminate the KC-10* program when they’ve got, say, 50 operational KC-46s, it could be conceivable that USAF might very well decide to just accelerate the KC-Y programme instead. In short, partly walking away from the KC-46 – made possible by Boeing having shot themselves in the foot by under bidding on a fixed price contract while consistently underperforming on R&D – USAF could tell Congress that times have changed… i.e. what they really need is larger tankers etc., but that they’re”happy with 100, or so, KC-46 Pegasus tankers”. 😉

      *

      “If you do horizontal cuts, you achieve small efficiencies across a very large force,” he added. “If you do vertical cuts, where you essentially divest of an entire weapon system … then you achieve greater savings over a shorter timeline.”

      http://www.dodbuzz.com/2013/09/17/air-force-may-scrap-kc-10-tanker-fleet-general/

      From the Flightglobal link:

      Boeing must perform on the new KC-46 tanker programme, the US Air Force is warning the company as the aircraft enters its preliminary design review (PDR). Otherwise the service could walk away.

      “We could buy more KC-46s or – make no mistake about it – if Boeing doesn’t perform, we’ll just start another competition,” says Maj Gen Christopher Bogdan, the USAF’s KC-46 programme executive officer.

      The USAF wants a total of 179 KC-46 tankers eventually, but initially Boeing is obligated to deliver the first batch of 18 combat-ready KC-46As by August 2017.

      • Judging by the history of the F-22, whose numbers were whittled down with budget constraints, how many KC-46? Probably less than initially planned.

    • @Keesje

      “However, the big elephant in the room is what would happen if Boeing is incapable of delivering 18 fully operational KC-46s by August 2017”

      They won’t. And everyone knows, it’s just window dressing.”

      I remember you making a similar claim 2-3 years ago that there was no way Boeing was going deliver 350+/- 787’s by the end of 2015. Something to the effect “Boeing fans were dreaming if they think it would happen”

      Tell us, how’s that prediction working out? 😉

  8. Was it a cleaning agent they where running through the fuelling lines, because, it thought it would be aircraft grade fuel that would be in there, and as boeing has huge reserves of the stuff on site then i think this a stalling operation! Smoke and mirrors guys, smoke and mirrors!

    • [i]Was it a cleaning agent they where running through the fuelling lines, because, it thought it would be aircraft grade fuel that would be in there, and as boeing has huge reserves of the stuff on site then i think this a stalling operation! Smoke and mirrors guys, smoke and mirrors![/i]

      If you want to [i]test[/i] the system, e.g. for leaks and similar, you wouldn’t necessarily use the real thing. Something that makes detecting leaks easier while not carrying the “inflammable” sticker might make a bit more sense.

      • The ‘wrong fluid’ seems to be the least of the fuel systems problems.

        “Redesigns and retrofits required to address a faulty integrated fuel system for the tanker appear to be the cause of the latest cost overrun for Boeing to keep the U.S. Air Force’s KC-46 aerial refueling program on track.
        …..Boeing spokeswoman says, noting poor designs were found in pumps, valves and couplers among other equipment. “-Aviation Week

        Who would have thought that the heart of the tankers systems would be so poorly designed and or made ?
        You wonder what will happen with the newly designed flying boom when it gets to run through all its test points. Some would think that would be most likely postponed in some way till after the full go ahead is made ?

  9. Well Boeing will just throw more money at it and blame the workers

  10. How is it that Boeing could “only” underbid Airbus by 10% when selling 18 767 tankers while Airbus was stuck with the (larger and more expensive basic article) A330? (and BigB is still losing it’s shirt, what was is; a billion and counting?)

    How is it that despite falling booms and a huge number of different customers (rather than a single large customer to focus on) the A330 derived tankers are operational? – if you wish to bring up Italy or Japan… why isn’t that helping Boeing?

    The airforce is not happy with the new deal, they chose their preferred solution in the second competition. MRTT’s can be had on a COTS basis from Airtanker (UK). they could initially “lease” a couple of the UK surplus – do some operational testing without the whole R&D risk or iLRIP pressure. Then, If and only IF they actually like them, they could easily set up an arrangement similar to the UK. No risk, no pressure, No problems!
    The whole deal was supposed to include tranched buys anyway. Just don’t buy all 179 from Boeing. Limit it to as little as you can get away with without incentivising Boeing to wage endless legal and political battles, and roll up the rest with the KC-Y and KC-Z programs.

  11. After all the pain with this programme, USAF will probably take the 179 KC46 and switch the rest of their tanker demands to outsourced service providers. If it works for the Army, why shouldn’t the AF do the same?

  12. The USAF assigned a low devlopment risk to the proposal of Northrop Grumman and a moderate risk to the proposal made by Boeing.

    The error USAF made in last contest was not to translate such a risk into US Dollars. The proposal made by EADS is cheaper today because any delayed tanker production will keep the expensive KC-135 longer on duty.

  13. The Airforce decided on the Northrop-Airbus product and was over-ruled by the politicians. The politicians then forced the KC767 onto the force.

    I would not bet against that decision to be reviewed and eventually the experts to get the plane they want.

    • @layman
      “The Airforce decided on the Northrop-Airbus product and was over-ruled by the politicians. The politicians then forced the KC767 onto the force.”

      Ughhh you keep saying this nonsense, and expect it to become true. It won’t. The Air Force was dinged for jacking up the bid process……..this has been said time and time again. Please stop.

      • Its still true the USAF ‘wanted’ the Airbus KC30, whether Boeing thought it was all square was another matter. Indeed the final competition rules were jacked up to favour a smaller plane which happened to favour Boeing, who then under bid to make sure.
        When Boeing and Under secretary Darleen Druyun corrupted the very first deal, that should have disqualified them completely. Their corruption extended to other projects under the asleep at the wheel GWB.

      • “The Airforce decided on the Northrop-Airbus product and was over-ruled by the politicians. The politicians then forced the KC767 onto the force.”

        That is what happened, the rules were adjusted to make sure the hometeam won. A reality that will remain unacceptable for many for ever.

        Maybe afterall it would have been better for all if the contract was simply assigned to Boeing without competition in 2004. With new generation engines etc.

  14. Yes, according to the report, which cites a number of Air Force pilots and senior officials as sources, the JSF — with an estimated lifetime cost in the trillions — after a decade of development the pampered project sports a gun that is currently little more than a decoration hanging as dead weight.

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