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  (Source: Northrop Grumman)

Northrop Grumman/EADS KC-45A tanker  (Source: Northrop Grumman)
Boeing wins the battle, but the war continues with the controversial Air Force tanker program.

It looks like the ongoing battle between Northrop Grumman/EADS and Boeing over the $35B Air Force tanker contract will go on for at least another year. Northrop Grumman/EADS won the KC-X tanker competition earlier this year and it was announced that the Airbus A330-based KC-45 would replace the Air Force's existing fleet of 531 KC-135 tanker aircraft.

With foreign hands having a part in the design and construction of the KC-45, some in Congress weren't too happy with the move. "We should have an American tanker built by an American company with American workers. I can't believe we would create French [and British] jobs in place of Kansas jobs," said Todd Tiahrt, a congressman from Kansas.

Boeing filed a formal protest against the Air Force's decision with the Government Accountability Office (GAO) in March. Boeing contended that it deserved the contract due to numerous errors and concessions made during the competition and noted that it provided "75 years of unmatched experience building tankers" and "offered the Air Force the best value and lowest risk tanker for its mission".

It looks as though Boeing has quite a bit of pull in Washington, because the GAO sided with Boeing’s protest. "Our review of the record led us to conclude that the Air Force had made a number of significant errors that could have affected the outcome of what was a close competition," said the GAO in a statement.

"We recommended that the Air Force reopen discussions ... obtain revised proposals, re-evaluate the revised proposals, and make a new source selection decision, consistent with our decision," the GAO continued.

Further stacking future proceedings in Boeing's favor, the GAO reported that the Air Force performed "unreasonable" cost/performance analysis with regards to the Northrop Grumman/EADS entry versus Boeing's competing entry. Had those errors not have been made; the GAO concluded that Boeing would have been the low-cost champion of the competition, and likely the overall winner.

The Air Force will in essence have to start the competition all over again to satisfy the GAO's requests – in the mean time; the aging KC-135 fleet will still take to the skies. "In theory, the air force has 60 days to answer. But in reality, it's obvious they're going to have to start over," said Lexington Institute military analyst Loren Thompson.

EADS, as expected, wasn't exactly elated with the GAO's decision. "Though we are disappointed, it's important to recognize that the GAO announcement is an evaluation of the selection process, not the merits of the aircraft," said EADA spokesman Louis Gallois.

"We will support our partner Northrop and remain confident that the KC-45 is the aircraft best suited to make the Air Force's critical mission requirements, as demonstrated by four previous competitive selections."

Not surprisingly, Boeing is ecstatic about the ruling. "We welcome and support today's ruling by the GAO fully sustaining the grounds of our protest," said Boeing tanker group VP Mark McGraw. "We look forward to working with the Air Force on next steps in this critical procurement for our warfighters."

Supporters of Boeing's protest in Congress also welcomed the GAO's decision. "The GAO's decision in the tanker protest reveals serious errors in the Air Force's handling of this critically important competition. We now need not only a new full, fair and open competition in compliance with the GAO recommendations, but also a thorough review of -- and accountability for -- the process that produced such a flawed result," said Senator Carl Levin (D-Michigan).

"The GAO did its work, and the Air Force is going to have to go back and do its work more thoroughly," added Representative Ike Skelton (D-Missouri).

You can read the GAO's full report including seven areas in which it found the Air Force's decision to be flawed here.



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By cjc1103 on 6/20/2008 10:38:25 AM , Rating: 2
I flew tankers in the Air Force, and while they do generally land at large Air Force bases, they can land at smaller austere airfields if need be. The criteria for choosing a base is not that a C-5 can land there also, it is that support is better for the aircrews, fuel, maintenance etc, and they have the long runways necessary for large airplanes. Air Force Reserve and Air National Guard tankers usually are based at commercial airports because of convenience. It's nothing to do with the small vs large argument. Also the Airbus tanker even though it is larger then the Boeing tanker, could still park in the footprint of the existing 707-based KC-135 tanker, that was a requirement in the contract. Boeing's 777 would not have met this requirement, so it was not offered. The big argument for operational cost is the Airbus will deliver more fuel and/or cargo, but if you don't need any more capacity than the 767 would deliver, then the 767 is more efficient. So it's matter of determining what the actual fuel offload and cargo reqirements are going to be in the future. Also C-17 cargo planes are better for straight cargo, maybe they should buy more of those, but with the current political situation, no more are being bought, and Boeing is shutting down the C-17 production line.


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