Tanker Contract: Follow the law

Update, Feb. 1:

The newspaper The Hill, which covers Capitol Hill, reports the USAF plans to award a contract for the KC-X this summer, sticking (more or less) to the timetable originally projected. Secretary Robert Gates also plans to urge President Obama to veto any FY2011 defense bill that contains funding for the Boeing C-17, which Gates cuts from the proposed budget.

We believe cutting funding for the C-17 is a mistake. We also believe the Administration ought to take Stimulus funds, double the KC-X procurement from 12-18 tankers a year (resulting in retiring the ancient KC-135s a lot faster) and split the contract between Boeing for the KC-767 and Northrop Grumman for the KC-30. In addition to the only political solution that will work, there are solid strategic reasons for the procurement to be split.

Taking Stimulus money to establish a new aerospace industrial base in Mobile (AL) while supporting the existing 767 program is far more productive than giving Stimulus money to things like a California dinner train.

Original Post:

Here’s a commentary from an outfit we’d never heard of before, the Forerunner Foundation. This op-ed piece appeared in the January 11 issue of Aviation Week magazine. The writer, Jerry Cox, makes an interesting point over the campaign by Boeing supporters to exclude the Northrop Grumman (Airbus) bid for the KC-X tanker.

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France “protectionist,” says Boeing

We wonder what took Boeing so long to make this obvious point: France is protectionist in its defense purchases and should quit complaining about the KC-X competition in the US. See this Reuters story.

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Outlook for Airbus, Boeing in 2010


2009 has faded into history and 2010 is here. Last year wasn’t kind to Airbus or Boeing—though it was worse for the latter than the former. How will this year be?

We’ll get right into how we see things lining up for the two largest airframe OEMs for this year.

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USAF used criteria GAO rejected in new DRFP: KC-30 backers

Update, December 8:

Bill Barksdale, Boeing KC-7A7 spokesman, emailed us with a response to this column. We have posted his note in the Comments section below.

Original Post:

The USAF used criteria in the current Draft RFP for the KC-X competition that had been rejected by the Government Accountability Office’s review of the Boeing protest last year, an analysis by prepared by EADS North America and Northrop Grumman asserts.

This unfairly tilts the current DRFP toward the Boeing KC-767 and is the basis Northrop why said it will not submit a bid unless major changes are made with the Final RFP.

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USAF RFP supports smaller airplane: Boeing

Bloomberg quotes the CEO of Boeing Integrated Defense Systems as saying the USAF Draft RFP for the KC-X competition favors the smaller 767.

Bloomberg writes:

Boeing Says Tanker Request Favors a 767-Based Plane (Update1)
2009-12-03 16:13:59.557 GMT

By Gopal Ratnam
Dec. 3 (Bloomberg) — Boeing Co. defense chief Dennis Muilenburg said the U.S. Air Force’s requirements for a new aerial refueling tanker favor a 767-based airplane.

“It’s important for us to allow the customer to finalize the requirement, but if you look at the current request for proposals it would push us toward a 767-based plane,” Muilenburg said today at a conference sponsored by Credit Suisse Group AG in New York.
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No KC-30 means no A330 plant in Mobile

Airbus has said it before but it is worth reminding people that if Northrop Grumman follows through on its statement that it will not bid the KC-30 in the KC-X competition unless significant changes are made to the Draft Request for Proposals (DRFP), Airbus won’t build an A330-200F assembly plant on its own in Mobile (AL).

We checked with Airbus immediately after Northrop’s announcement and a spokesman confirmed that the company’s position has not changed: there is no “business case” for an A330F final assembly line (FAL) without the KC-30 tanker contract.

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Northrop says no bid on tanker unless…

Update, December 2, 3:00 pm: DOD Buzz reports that Rep. John Murtha, a powerful House member, says there has to be competition for the KC-X and doesn’t rule out Congress stepping in.

This is something we forgot to mention in our Update below. We fully expect an effort on the part of some Members of Congress to renew the effort for a split buy. As we have written many times before, we can think of many strategic reasons this makes sense, let alone the political solution. But this also only makes sense if the procurement is doubled from the 12-18 per year proposed by DOD to 24-36 a year. We also believe the KC-777 is the best replacement for the aging KC-10.

There is enough strategic need to go around for everyone. That this continues to be a political football should be an embarrassment to all concerned.

Update, December 2:

(See Original Post below the jump for background.)

The prospect that Northrop Grumman won’t submit a bid unless the Final RFP is changed to allow for the different sizes between the KC-30 and the KC-767 is very similar to what happened with the 2006 competition.

The USAF then initially did not plan an “extra credit” for larger capabilities exceeding the minimum requirements of the airplane. Northrop threatened to withdraw from that competition unless the FRFP allowed for extra credit–and prevailed.

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KC-30 MRTT refuels fighters through boom, drogues

EADS released these photos of the KC-30 MRTT refueling fighters. The company previously released photos of refueling as viewed through the 3D controller’s panel video screen. The MRTT has now “passed gas” (as we like to say, much to the consternation of the more straight-laced crowd) through the new flying boom from the MRTT.

Source: EADS North America

These delayed tests have been the target of much criticism from Boeing supporters, who pointed out that EADS has been delayed in meeting milestones for the Royal Australian Air Force deliveries, which are now 18 months late. About six months of the delay was due to customer change-order requests.

KC-767 to benefit from 787 “surge” line

Key points:

  • The ability to increase production rates to sell more 767s in the coming years;
  • Lower production costs, which will be built into the KC-X bid in the hot competition with the expected Northrop Grumman KC-30 submission.

Boeing’s proposed KC-767 refueling tanker will benefit from plans to establish a surge production line for the 787 program.

The connection is not obvious, for Boeing didn’t suggest as much when it announced that Charleston (SC) will be the location for the second 787 production line. As Line 2 is being established, Boeing will put a “surge” 787 line in Everett (WA), where Line 1 is located. The surge line will be in the forward bay where the 767 line is, requiring relocating the 767 line to the aft part of the bay.

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Tanker DRFP may violate law: former procurement official

Inside Defense, a subscription-only publication, today reported that a former defense procurement official believes the current KC-X tanker Draft RFP may violate the law. Here is what Inside Defense sent out in the public domain:

Former Top Procurement Official Questions KC-X Compliance with New Acquisition Law

The Pentagon’s solicitation for the KC-X aerial refueling competition is inconsistent with the 2009 Weapon Systems Acquisition Reform Act and may violate the law, according to a former top federal procurement officer.

That critique, by Robert Burton, a former deputy administrator of the Office of Federal Procurement and Defense Department veteran, comes as a powerful lawmaker and a key architect of the recently enacted weapon systems acquisition reform law — Sen. John McCain (R-AZ) — is raising questions about whether the KC-X draft request for proposals, issued on Sept. 25, complies with the new act.

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