Leeham News and Analysis
There's more to real news than a news release.
Production boosts at Boeing: more to come for 737
Boeing’s announcement today that it will boost production of the 777 from the previously announced 7/mo to 8.3/mo (100 a year) is good news for Boeing, its customers, the supply chain and (to be parochial about it) Washington State, where the airplanes are made.
But this isn’t all.
As we have previously written, Boeing is already thinking of boosting 737 production beyond the 38/mo previously announced, to as much as 42: 41 commercial 737s and one 737-based P-8A Poseidon, all assembled in Renton (WA). (The fuselage is built by Spirit Aerosystems in Wichita (KS), which at one time was Boeing’s facility.)
We learned that even 42/mo may not be the end of it. Boeing foresees the 737 production rate to as many as 50/mo.
Inslee tanker amendment dropped for DOD Reauthorization
Update, 10:30 AM PST: We have now confirmed that the House leadership has dropped the Inslee Amendment from the Defense Reauthorization Act that will be sent to the Senate.
We also received confirmation this morning from Inslee’s office that the letter below the jump was written in advance of House action because it had been learned Section 848 might be removed from the House version of the Act.
Original Post:
It appears the so-called Inslee Amendment in the House Defense Reauthorization Act demanding the US Air Force take into account illegal subsidies provided Airbus and Boeing in the KC-X competition may be in jeopardy.
The Seattle Post Intelligencer first reported that Washington State Congressman Rick Larsen was circulating a letter to senior House members calling for the Inslee Amendment (official known as Section 848 of the Reauthorization bill) to be retained in the House version as it goes over to the US Senate for consideration.
But a close reading of the letter raises questions whether the Amendment is or isn’t currently in the Act. The House is in the process of revising the Act before sending it to the Senate for approval. Time is short for the Senate to act before the Christmas recess, and a bill that is not controversial is needed to speed things along.
The House version has a reported 300 add-on provisions that could cause debate in the Senate, including Don’t Ask, Don’t Tell, the Inslee Amendment and only the politicians in DC know what else.
The Don’t Ask provision was separated from the Act for a stand-alone vote yesterday in the House, where it passed. The Senate previously voted this down but another try is going to be made.
Outsourcing US Defense
As regular readers know, a major piece of controversy over the prospect of awarding the KC-X contract to EADS North America is the assertion that this will outsource US defense procurement to a foreign company.
We’ve noted in this space many times before that this issue, in this context, is a red herring, because the Defense Department has been doing so for years and is increasingly doing so–without the hue and cry that accompanies the prospect of EADS getting this contract.
A recent article by George Talbot of The Mobile Press-Register illustrates the outsourcing to foreign companies. While Talbot talks about EADS, because Mobile (AL) (which is, one may be reminded, part of the United States–the Confederacy did lose the Civil War) is where EADS plans to build the tanker, it is also the location of an Australian company called Austal that is poised to receive a contract to build the Navy’s Littoral Combat Ship (LCS).
A350 begins fuselage construction, refines program management
Airbus has begun construction of the A350 fuselage.
Airbus photo, rendering
Airbus also announced refinements in the A350 program management to provide more accountability and coordination. This article describes it in Aviation Week, by Robert Wall.
EADS will likely win tanker, says Boeing consultant
Update, Dec. 9, 5:00 AM PST:
Politico has this profile on Loren Thompson.
Flight Global reports Brazil may select the KC-45 to replace its Boeing KC-137 (KC-135).
Update, 5:00 PM PST: Dominic Gates now has his story on this topic here.
Original Post:
George Talbot of The Mobile Press Register posted this story today in which Loren Thompson, an aerospace defense analyst who has done work for Boeing, says Boeing has concluded EADS is going to win the KC-X tanker competition.
In Talbot’s article, Thompson once again advances the Boeing line about WTO and Airbus’ illegal subsidies as evidence of a USAF “bias toward EADS.”
There is just one problem with this line of allegation with respect to the WTO issue:
US law doesn’t allow the USAF to take the WTO panel finding into account, and Thompson, Boeing and its Congressional supporters know it.
USAF, EADS need to come forward with full details
The USAF and EADS need to come forward with full details to fully explain the latest cock-up (a British term, not an obscene one) in which the Air Force mistakenly sent EADS and Boeing proprietary information about the other company’s KC-X submission.
EADS, the Air Force and Boeing say that when EADS and Boeing discovered the error, the companies began a procedure that has been in place for years to seal up the files and computers and to notify the USAF of the error. The Air Force initially said, in essence, “no harm, no foul.” But then in classic Wikileaks fashion, information dribbled out bit-by-bit that there was more to the story than the Air Force–and EADS–let on.
At a press conference–which we were at–EADS North America CEO Sean O’Keefe gave a detailed response to questions about the matter. But within days, it was charged by Lexington Institute’s Loren Thompson that EADS had actually opened the proprietary file but Boeing had not. He did not cite sources for his information, and his close ties to Boeing immediately raised the suspicion that Boeing leaked this information to him.