Boeing wins US Air Force tanker contract

[Big Phil]

http://seattletimes.nwsource.com/html/b ... ker25.html

Boeing wins huge Air Force tanker contract
The Air Force awarded its $35 billion air-refueling tanker contract Thursday to Boeing. By Dominic Gates Seattle Times aerospace reporter
The Air Force awarded its $35 billion air-refueling tanker contract Thursday to Boeing, surprising many defense analysts and bringing relief and delight to advocates for Washington state.
Boeing will build its 767 tanker on a newly opened assembly line at the back of its Everett widebody jet plant.
Winning the tanker contract secures what Boeing says are 11,000 direct and indirect jobs in Washington state. That figure includes not only projected jobs at Boeing and at its in-state suppliers, but also at any kind of business — from bars to bakeries — serving the aerospace workforce.
Boeing was originally awarded a tanker contract in 2001, but that deal, which was never open to competitors, was swamped in controversy. It was canceled after a procurement scandal that sent Boeing's then-chief financial officer to jail.
In 2008, after an open competition, the contract was awarded to a joint bid from Northrop Grumman and Airbus parent company EADS. The award was canceled after Boeing challenged the procedures leading to the decision.
This time around, Northrop withdrew and it was a straight head-to-head contest between Boeing and EADS.
Though the Air Force award will draw the ire of politicians in southern states that would have benefited from an EADS win, the decision may finally bring the decade-long saga to a close.
EADS now has three days to ask for a debriefing as to why exactly it lost. That debriefing must take place within five days, after which EADS has another five days to decide if it wants to formally protest the decision.
Ralph Crosby, head of EADS North America, recently told the Press-Register newspaper in Mobile, Ala., that absent "some egregious process error," his company was unlikely to contest a Boeing win.
The outcome is a bitter disappointment for EADS.
The European planemaker had hoped to establish itself as a peer with U.S. companies in bidding for major defense contracts in the future.
It had also wanted a manufacturing facility in the U.S. that would have brought revenue in dollars — valuable as the euro rises against the dollar.
With expectations that Airbus could price its plane lower than Boeing, and leaks suggesting that the EADS A330 had outscored the Boeing 767 on a key mission evaluation that was part of the Air Force assessment, analysts had recently been predicting an EADS win.
With the outcome reversed, the happiest man at Boeing may be commercial airplanes chief Jim Albaugh, who was on a flight back from Texas to Seattle as the announcement was made.
Albaugh took over the defense side of the company in 2002 and closely shepherded Boeing's tanker bid afterward.
Having switched roles to head Boeing's commercial jet division in the fall of 2009, Albaugh will now get to oversee the building of the tanker.
Boeing stock rose $2.52, or 3.6 percent, to $73.28 in early after-hours trading.

Good news for Boeing, and good news for the US. Too bad it took eight years to arrive (maybe) at a final decision.

[MKSheppard]

Remember that the EADS tanker would have been built in Alabama at a nearly new plant, with a large amount of US suppliers.

[The Duchess of Zeon]

Remember that the EADS tanker would have been built in Alabama at a nearly new plant, with a large amount of US suppliers.

So? Sanchez is from Seattle; sucks to be Alabama, but people in Washington State sort of like having Boeing around.

[MKSheppard]

So?

So? I've had enough of Boeing propaganda saying BUILT IN THE US BY AMERICAN WORKERS the last year or so, implying that the EADS entry would be built in that evil european country of FRANCE.

(I live in the prime military industrial complex propaganda zone of Washington DC)

[Pelranius]

I hope this is the last we hear of this miserable kerfluffle of a bidding process.

[Lonestar]

So? I've had enough of Boeing propaganda saying BUILT IN THE US BY AMERICAN WORKERS the last year or so, implying that the EADS entry would be built in that evil european country of FRANCE.

(I live in the prime military industrial complex propaganda zone of Washington DC)

No kidding, every fucking day on every fucking radio Station, Boeing screeching about howmost of the Jobs will go to Europeans during an economic downturn.

[paladin]

Not surprised by Boeing winning the contract. I don't think Congress would award it to an overseas company when if the aircraft would be built here.

[MKSheppard]

Not surprised by Boeing winning the contract. I don't think Congress would award it to an overseas company when if the aircraft would be built here.

*sighs*

If EADS won, the aircraft would have been built in a modern factory in the South, with a significant amount of US manufactured small parts from other US suppliers.

QOTD: "Behind all the tiffs over gear, capabilities and capacities, this has really been a fight over labor costs: Boeing with highest cost union labor in a fully depreciated plant vs. Airbus with new-hire low cost labor in a new build greenfield plant designed for efficiency. "

[Thanas]

Let's be real here - there was no way Airbus was going to win, not with the blatant favoritism shown to boeing by the Pentagon and democrats in congress.

[Lonestar]

Let's be real here - there was no way Airbus was going to win, not with the blatant favoritism shown to boeing by the Pentagon and democrats in congress.

Thanas is against Labor Unions. You all saw it. You can't unread it.

[erik_t]

Let's be real here - there was no way Airbus was going to win, not with the blatant favoritism shown to boeing by the Pentagon and democrats in congress.

Or, you know, the USAF decided to actually adhere to the terms of the RFP this time around.

Was that RFP pretty favorable to the Boeing design? Yes, but not in any kind of indefensible WTO-flaunting sort of sense. In a theoretical one-for-one replacement for KC-135, it's kind of a big deal if a larger aircraft takes up way more space on the parking ramp. We can rationally discuss to what degree an issue like this should determine the victor, but this was all in the RFP when EADS signed up.

[paladin]

Let's be real here - there was no way Airbus was going to win, not with the blatant favoritism shown to boeing by the Pentagon and democrats in congress.

Thanas stated it better than I did. The entry from Airbus offered longer range and higher fuel capacity compared to Boeing's entry.

[Big Phil]

Let's be real here - there was no way Airbus was going to win, not with the blatant favoritism shown to boeing by the Pentagon and democrats in congress.

Oh really? Boeing won the first competition back in 2003, but then there were various scandals (none of which had anything to do with the Air Force selecting the wrong airframe) and the Air Force re-opened the competition.

Then, the second time around, the Air Force selected the Airbus entry. Except that Boeing protested and the GAO agreed that the Air Force had behaved improperly in changing the RFP so that it was more favorable toward the Airbus entry... so a third competition was held.

And we know that Boeing won this third competition, but you're forgetting that the Air Force sent EADS a copy of Boeing's submission several months back. Kind of hard to say that the Pentagon is showing favoritism to Boeing when they all but went out of their way to screw Boeing's proposal over.

[Lonestar]

There wasn't a "First Competition", numbnuts, it was a single source "lease to buy" contract that was so suspect it's what gave EADS a reason to make a serious bid.

Thanas stated it better than I did. The entry from Airbus offered longer range and higher fuel capacity compared to Boeing's entry.

It also burned a ton more fuel per hour than the Boeing entry, and so what if it exceeded requirements? Believe it or not, in the US, cost DOES matter.

[erik_t]

Let's be real here - there was no way Airbus was going to win, not with the blatant favoritism shown to boeing by the Pentagon and democrats in congress.

Thanas stated it better than I did. The entry from Airbus offered longer range and higher fuel capacity compared to Boeing's entry.

You know what would offer even longer range and more fuel? Tanker-An-225. But that capability isn't required, and comes with associated penalties (size, cost).

[Kyler]

It also worth noting that the KC-330 is soo large that not all current KC-135 bases would be able to handle the larger aircraft. Their ramps, facilities, & runways would have to improved to deal with the weight & larger size more so then the KC-767. So the additional infrastructure costs with the KC-330 would be much higher. The KC-330 would have not beeb able to delpoy to nearly as many bases at the KC-767 cause size & weight. Another thing is the KC-330 is not able to refuel the CV-22.

I wonder also if the recent accident with EADS boom during a test had any influence on the final decision.

Both are good aircraft and eventually I see either the KC-330 or another Airbus flying for the USAF. EADS definitely has made some in roads into the DoD. The US Army has been very happy with the UH-72 Lakotas. A version of that helicopter is up for the Army's new armed scout helicopter. EADS could win some serious future gold stars if it decides not to protest the decision, but only time will tell.

[Big Phil]

Let's be real here - there was no way Airbus was going to win, not with the blatant favoritism shown to boeing by the Pentagon and democrats in congress.

Thanas stated it better than I did. The entry from Airbus offered longer range and higher fuel capacity compared to Boeing's entry.

According to the GAO, the Air Force screwed up the RFP process that Airbus won because they ignored their own specifications. The Air Force requested a tanker with capabilities roughly equivalent to those of the 767, but instead selected the Airbus proposal because they liked the larger airframe, greater airlift capability, etc. In other words, they asked for a mid-size sedan, but then chose a SUV because it was bigger and more flexible. If I recall correctly, Boeing's gripe was that the 767 met the selection criteria that the Air Force put forth, while the Airbus entry did not. The 777 was a closer match to the Airbus entry, but that's not what the Air Force asked for.

[Sea Skimmer]

The biggest reason they liked the Airbus plane was it could take palletized cargo for quick loading and unloading, while the 767 can only take specialist containers or else loose bag type stuff; but nothing about cargo capacity was ever part of the requirements at all. Probably should have been, but it wasn’t, in part because it would undermine the campaign to get more C-17s and C-5Ms produced.

[erik_t]

Standard 767 takes a somewhat smaller palletized container (LD2 or LD8) than most airliners, but is certainly not something I'd call "specialist". Is this the case on KC-46, or are you referring to a different situation?

[Vympel]

And we know that Boeing won this third competition, but you're forgetting that the Air Force sent EADS a copy of Boeing's submission several months back. Kind of hard to say that the Pentagon is showing favoritism to Boeing when they all but went out of their way to screw Boeing's proposal over.

What I heard happened is that the USAF sent their evaluation of each side's submissions to the other side by accident, I never heard of anything to indicate that this time around they "went out of their way to screw Boeing's proposal over."

[Sarevok]

Standard 767 takes a somewhat smaller palletized container (LD2 or LD8) than most airliners, but is certainly not something I'd call "specialist". Is this the case on KC-46, or are you referring to a different situation?

Is not the 767 the only aircraft that currently uses LD2 containers ?

[Thanas]

Both are good aircraft and eventually I see either the KC-330 or another Airbus flying for the USAF. EADS definitely has made some in roads into the DoD. The US Army has been very happy with the UH-72 Lakotas. A version of that helicopter is up for the Army's new armed scout helicopter. EADS could win some serious future gold stars if it decides not to protest the decision, but only time will tell.

These are small potatoes. The entire helicopter contract was worth 3 billion. The tanker contract is worth 35 billion and may end up being worth 100 billion in total.

And when the rules were rewritten for the third competition so that they solely favored the smaller aircraft, it was pretty clear which way the wind was blowing.

So yes, this is a tremendous defeat for EADS. Luckily for them, Airbus is still outperforming Boeing in the civilian market, so it is not a total loss. However, this should help Boeing to stay afloat even if their civilian market starts to fail.

[Beowulf]

Assuming a 1 for 1 replacement, there remains another ~200 KC-135s that will need to be replaced, and given the advancing age of the KC-10 fleet, by the time the KC-135 replacement is complete, those will likely also need replacement. EADS still has the ability to gain a tanker contract, if the next USAF competition isn't slanted towards a smaller aircraft, while EADS bids another KC-330.

I'm not quite sure how the cargo container is pertinent, as most equipment is stuck onto "463L" pallets, and will likely go on the main deck, rather than into the cargo compartment that a typical airliner would use. I was under the impression that at least part of the under-deck space was actually used for fuel tankage.

[Big Phil]

Both are good aircraft and eventually I see either the KC-330 or another Airbus flying for the USAF. EADS definitely has made some in roads into the DoD. The US Army has been very happy with the UH-72 Lakotas. A version of that helicopter is up for the Army's new armed scout helicopter. EADS could win some serious future gold stars if it decides not to protest the decision, but only time will tell.

These are small potatoes. The entire helicopter contract was worth 3 billion. The tanker contract is worth 35 billion and may end up being worth 100 billion in total.

And when the rules were rewritten for the third competition so that they solely favored the smaller aircraft, it was pretty clear which way the wind was blowing.

Thanas, you're missing the point that the SECOND tanker competition was re-written IN THE MIDDLE OF THE COMPETITION to favor the Airbus entry, after the original RFP had specified essentially a straight KC-135 replacement rather than a larger aircraft.

So yes, this is a tremendous defeat for EADS. Luckily for them, Airbus is still outperforming Boeing in the civilian market, so it is not a total loss. However, this should help Boeing to stay afloat even if their civilian market starts to fail.

This sounds quite a bit like the nationalistic chest thumping of which you Europeans are so disdainful... could it be that when push comes to shove Germans are just as nationalistic and prideful as Americans? Say it isn't so Joe...

[bobalot]

So yes, this is a tremendous defeat for EADS. Luckily for them, Airbus is still outperforming Boeing in the civilian market, so it is not a total loss. However, this should help Boeing to stay afloat even if their civilian market starts to fail.

This sounds quite a bit like the nationalistic chest thumping of which you Europeans are so disdainful... could it be that when push comes to shove Germans are just as nationalistic and prideful as Americans? Say it isn't so Joe...

The comment was regarding Airbus's position (see bold). I didn't see any nationalistic chest thumping there.

Of course, a few sentences in a forum shows that German nationalism is on par with the torrents of "America is the greates nation in the world" \ "America is unique because it does X" bullshit that everybody else in the world is bombarded with.