June 25, 2015: We don’t often stray into military topics, usually confining ourselves to commercial derivative programs like the Boeing P-8 Poseidon, KC-46a, Airbus KC-330 and the like. But, of all places, Politico has an interesting three-screen piece about President Obama’s “Plan B” in case the talks with Iran fail over curbing its nuclear program.
Plan B calls for the prospect of a Northrop Grumman B-2 stealth bomber dropping a series Massive Ordnance Penetrators, or MOPs, on targeted Iranian nuke facilities to destroy them. The MOP is a super-bomb, but of non-nuclear design, that is so big and so powerful it can penetrates some 200 feet under ground before it blows up. Boeing designed the MOP.
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EADS CEO Louis Gallois went public today in Europe with his prediction that the USAF will award a tanker contract next month. The best and final bid will be submitted this month.
We previously noted that the final bids were due this month and a contract award expected next month.
Meanwhile, here is an interesting story on the tanker from KING5 TV in Seattle, with this piece.
As readers know, the competition is a price shoot-out. As the KING story notes, Boeing continues to be worried about the benefit EADS has from subsidies found to be illegal by the WTO on the ability to under-price Boeing, but as we noted in this post last year, WTO may not have the effect Boeing fears; the withdrawal of Northrop Grumman as a partner to EADS has a much larger benefit to EADS’ ability to price the airplane.
We have, from time-to-time, joked that the USAF ought to buy a Russian aerial tanker as a way to avoid the Boeing-EADS-Northrop-Airbus rhubarb in the long-running KC-X saga.
Well, here’s news that the US Navy is planning to buy Russian helicopters and United Technology’s Sikorsky helicopter division is not at all happy with this sole-source selection.
Let’s see if all the Buy American crowd gets as wound up over this one as they have in the KC-X contest.
Boeing’s Defense unit created a cybersecurity division a few years ago as the company recognized the growing threat to national security and the need to diversify from traditional weaponry with changing defense needs.
Here is a story today about Boeing’s effort to find new recruits for cybersecurity from Bloomberg.
A flurry of activity has been happening on the air force tanker front while we’ve been in Geneva, Switzerland, (working, not playing). Unfortunately, we think the activity has all been rather sad.
In the aftermath of the World Trade Organization issuing its final report on the US Trade Representative complaint about illegal subsidies to Airbus, the anti-Airbus crowd has once again seized on this issue to attack the new reports that Airbus parent EADS is now likely to bid on the KC-X contract against Boeing’s KC767NewGen.
Update, March 29: Airbus CEO Tom Enders now says a decision will be made in two-three weeks.
Geneva, Switzerland: EADS will decide within days whether to pursue a bid on the KC-X tanker program, this column has learned.
The Pentagon has yet to officially decide whether to grant a 90 day extension so EADS can be fully briefed on what is necessary to make a bid, something that Northrop Grumman had previously done as the prime contractor. EADS needs to be brought up to speed on everything Northrop learned during the previous effort to bid on the tanker.
Update, Mar. 19, 230PM PDT: Just when you thought this couldn’t get any weirder, Russia announced it plans to submit a bid to the KC-X, according to The Wall Street Journal:
In another twist to the ongoing saga to replace the Air Force’s aging fleet of aerial refueling tankers, United Aircraft Corp. of Russia is planning to bid on the $40 billion contract, according to a person familiar with its plans.
United Aircraft, an aerospace consortium owned by the Russian government, will seek to offer a tanker version of its Ilyushin Il-96 wide-body jetliner, dubbed the Il-98, this person said. The planes would be largely built in Russia, and assembled in the U.S., this person says. United Aircraft will partner with a “small U.S. defense contractor,” which will be renamed United Aircraft Corp. America Inc., this person said, declining to name that contractor.
Update, Mar. 19, 600AM PDT:
DOD says it might extend the deadline for submitting a bid so EADS can do so if it wants. Here is one story.
Update, Mar. 17, 900AM PDT:
This AP story cites EADS ambitions in the US, but buried toward the bottom is a new statement from EADS CEO Louis Gallois and EADS North America Sean O’Keefe about the prospect of EADS submitted a bid for the KC-X. Here is the excerpt:
Earlier this month, EADS pulled out of bidding for the Pentagon refueling tanker contract, saying a smaller plane offered by rival Boeing Co. appeared to be the front-runner. EADS, which had partnered with Northrop Grumman for the 179-tanker order, has criticized the contract as anticompetitive.
“The U.S. Air Force will not have the most modern, most capable airplane,” Gallois said. “It’ll be the first time the British, the Australians have a better airplane than the Americans.”
Gallois said it’s unlikely that EADS will submit a new bid for the tanker contract.
Instead, EADS will move to make other deals in the U.S. Building its presence here through acquisitions may bolster its case when bidding for national defense contracts, but “that would not be the objective,” said Sean O’Keefe, CEO of EADS North America.
But: comments added in our Comment section after the above posting suggest that EADS is still considering a bid if the deadline to do so is extended, and DOD might.
Won’t this ever go away?
Update, Mar. 16, 830AM PDT:
Airbus received EASA certification for the A330MRTT. Here’s an excerpt from the Bloomberg story that moved just a short time ago:
Airbus Tanker Gets Civil Certification From European Regulator
By Andrea Rothman
March 17 (Bloomberg) — European Aeronautic, Defence and Space Co.’s Airbus unit won civil certification for a military tanker version of its A330, putting the plane a step closer to maturity before it enters service in Australia by year-end.
Certification from the commercial aviation regulator, European Air Safety Agency, means handling qualities of the plane and on-board systems correspond to civil certifications, which are more stringent than military requirements. Besides refueling other planes in mid-flight, the A330 tanker could carry as many as 300 troops.
EASA’s approval is the first civil certification ever extended to a tanker and transport aircraft developed in Europe.
Update, March 15, 300PM PDT:
Richard Aboulafia has a particularly entertaining commentary in his latest monthly newsletter.
He also has a more prosaic but thoughtful commentary here.
Update, March 15, 900AM PDT:
This news report out of Europe updates the situation, in typical military fashion: Hurry up and Wait.
Information is coming out late today (March 12) that EADS may try and bid for the KC-X tanker contract after all. The Pentagon may extend the deadline for bidding to accommodate EADS, George Talbot of The Mobile Press-Register tells us. He will be posting his own story at www.al.com shortly.
Here are the stories:
In the three days following the withdrawal by Northrop Grumman from the KC-X tanker competition over its conclusion that the Final Request for Proposals for the USAF aerial tanker was irretrievably skewed toward the smaller Boeing KC-767, Northrop supporters and Europeans–notably France–have decried the fairness of the FRFP.
French officials in particular have bemoaned the development. Diplomats, all the way up to the President, have vowed “this is not over.” Retaliatory threats of freezing out US sales to Europe are being thrown about.
As readers of this column know, we have favored the Northrop KC-30 from the get-go and we have supported a split buy between the KC-767 and KC-30 for political and strategic reasons. With this reminder, we have this to say to Europe:
Get over it and move on.
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.