Jan. 24, 2022, © Leeham News: Jim Albaugh was president of Boeing Integrated Defense System (IDS), now known as Boeing Defense, Space and Security (BDS) during the competition for the US Air Force’s KC-X program.
After 9/11 (2001), Boeing was reeling as US airlines canceled or deferred orders in the aftermath of the terror attacks in New York City and Washington (DC). Terrorists hijacked four airplanes (all Boeing, as it turned out) operated by American and United airlines. Then, US carriers dominated the world market as customers for Boeing and Airbus. Boeing was disproportionately affected, as it was the USA’s two biggest airlines that were victims of the terror attacks.
Boeing, never one to look overlook an opportunity (this is not a criticism), saw one to help carry it through the post-9/11 crisis. The Air Force’s Boeing KC-135 tankers—based on the 707 airframe—were aging. The last tanker was delivered in 1965—36 years before. A replacement was needed. But the Air Force, along with the other Armed Services, now had a war to fight. President George W. Bush sent the troops to invade Afghanistan, where Osama bin Laden was holed up. Later, he expanded the war to Iraq on the theory Iraq was involved in 9/11 and developing weapons of mass destruction. Both theories later proved false.
The Air Force was pressed for money. So, Boeing offered to lease 100 tankers based on the 767-200ER for 20 years. The Air Force awarded the contract. But Sen. John McCain criticized the move as too costly to taxpayers. The investigation later revealed that the Air Force’s procurement officer improperly gave the contract to Boeing, and then went to work for the company. In the ensuing scandal, the officer and Boeing’s chief financial officer who gave her the job both went to jail. The lease deal was canceled.
A new procurement was launched. This time, EADS—the name of the Airbus Commercial parent at the time—joined with long-time defense contractor Northrop Grumman to bid against Boeing. Boeing offered a version of the KC-767. Northrop-EADS proposed a version of the A330-200 Multi-Role Tanker Transport.
As LNA’s series from the Airbus point of view reported, the competition was bitter. Both sides sharply criticized the other. Boeing and its surrogates and partisans weighed in heavily on (at the time) alleged illegal subsidies Airbus received, including for the A330.
In February 2008, the Air Force awarded the contract to Northrop-EADS, to the surprise of everyone; Boeing had been considered a shoo-in for the contract.
Albaugh, the IDS president, called this loss his biggest disappointment during his leadership at the defense unit.
In the debrief by the Air Force, Boeing learned for the first time the USAF had changed some of the parameters of the competition that gave Northrop the winning advantage. Boeing filed a protest with the Government Accountability Office (GAO). The GAO upheld the protest. The Pentagon had to re-run the competition.
By this time, Albaugh left in 2009 to become president of Boeing Commercial Airplanes. But Albaugh spent time with LNA to discuss the KC-X competition from Boeing’s point of view right through the Northrop win. He also provides observations about the coming KC-Y competition.
The details of this interview begin next week.
Royal Aeronautical Society
Named to the Top 10 List of Aerospace Books for Christmas Choices, 2021
Puget Sound Business Journal
(Seattle area.) No. 1 on the Christmas list of aerospace books for 2021.
No. 1 on its list of Best New Aerospace eBooks to read in 2022.
Chris Sloan, The Airchive
“A worthy successor to ‘The Sporty Game,’” the 1982 book by John Newhouse, considered at the time to be the definitive book about the competition between Boeing, McDonnell Douglas and the emerging Airbus.
Dan Catchpole, Aviation Writer
Air Wars is a tour de force look behind the curtain of Boeing and Airbus’ global competition and, in part, a biography of Airbus’ head salesman, John Leahy, the man who forced Boeing’s hand to re-engine the 737. Longtime aerospace analyst and journalist Scott Hamilton takes readers through the twists and turns of the decades long battle between the two companies.
Dan Reed, Aviation Writer
Using John Leahy’s long and monumental career as a vehicle for telling readers about the 51-year battle between Airbus and Boeing is both and interesting and inspired choice by the author.
1 THE MULTI-BILLION DOLLAR GAMBLE
2 FLYING CARGO
4 EARLY YEARS AT AIRBUS
5 HIGH RISK, HIGH REWARD
6 FACING OFF
7 THE DEATH OF McDONNELL DOUGLAS
8 WAKE-UP CALL
9 LAUNCHING THE A380
11 TROUBLE IN TOULOUSE
12 TRY, TRY AGAIN
13 FALLING APART
14 LABOR WARS
15 UPSTART AND DISRUPTOR
16 CREATING NEO
17 LAUNCHING MAX
19 THE X-FACTOR
20 SMASHING A BUG WITH A SLEDGEHAMMER
21 THE BOEING-EMBRAER JOINT VENTURE
22 LAST GASP
23 THE ALPHABET AIRPLANE