USAF KC-X Tanker programme

[buglerbilly]

Boeing: KC-X Fixed-Price Contract Likely To Stay

Published: 11 Jan 2010 16:16

Dennis Muilenburg, CEO of Boeing's Defense, Space and Security Systems division, announced Jan. 11 that the Chicago-based firm is well positioned to meet the demands of a fixed-price contract for the U.S. Air Force's $35 billion KC-X tanker competition.

Boeing says it is prepared to deliver its 767-based offering in the KC-X tanker competition under the demands of a fixed-price contract. (BOEING) While neither Boeing nor the competing Northrop Grumman-EADS team has been wild about the notion of a fixed-price contract for an aircraft with a production run that will last decades, Boeing now says it will be able to deliver an aircraft under such a deal.

"I believe fixed-price development will stay in the final" KC-X request for proposals (RfP), Muilenburg said during a National Aeronautic Association-sponsored speech in Arlington, Va. "We've had a good discussion with the customer on what it takes to make a fixed-price development work."

Muilenburg said Boeing's clear understanding of the requirements, as well as the fact that its 767-based offering is a mature technology, gives the company a clear advantage in a fixed-price contract.

Making such a contract work demands that "the technology up front is mature and well defined, it demands that we have very clear definitions of statement of work, and it demands that we understand up front that there won't be any changes during the development work," Muilenburg said.

He then fired a veiled shot at rival Northrop Grumman, which has been extremely vocal in its criticism of the Pentagon's draft RfP.

"We've chosen a path that says we understand the war-fighter requirements - we're not questioning those requirements," Muilenburg said. "It's our job to respond with our best offering to meet those requirements; that's still our position."

Northrop has threatened to drop out of the competition because it claims the entire solicitation is written in favor of a smaller, cheaper aircraft compared to its Airbus A330-based offering - which won the last round of the KC-X competition in 2008. Many have noted it would take an entirely new RfP to satisfy Northrop's demands.

Boeing successfully protested the 2008 award on the basis that key performance requirements in that RfP were unclear.

In the wake of Boeing's protest, Defense Secretary Robert Gates removed the program from the Air Force's hands and had his staff write the current draft RfP, released in September.

In the months since then, senior Pentagon officials have met with representatives from both companies - as well as lawmakers - to receive their feedback on the draft RfP. So far, the Pentagon has insisted that any changes included in the final solicitation will be relatively minor. The draft solicitation places an emphasis on a low-cost direct replacement for the medium-size KC-135R fleet.

The final RfP was due to be released Nov. 30. However, its release was delayed by Pentagon and Air Force officials so they could get more feedback from Boeing and Northrop. Air Force officials now say a final RfP should be released this month.

[buglerbilly]

EADS Confident In Tanker Bid If RfP Is Revised

By pierre tran

Published: 13 Jan 2010 09:22

SEVILLE, Spain - EADS Chief Executive Louis Gallois expressed confidence the Airbus A330 aircraft could win if the tender terms of the U.S. Air Force search for a new refueling plane were "balanced."

Northrop Grumman and EADS are offering the A330 Multi-Role Tanker Transport in the competition to replace the aging U.S. Air Force KC-135. (AGENCE FRANCE-PRESSE) Northrop Grumman, which has partnered EADS in offering the A330 Multi-Role Tanker Transport (MRTT), has said it would not bid if the draft version of the request for proposals (RfP) was adopted, as the terms appeared to favor the smaller 767 aircraft from archrival Boeing.

"The A330 MRTT is going successfully through all refueling tests," Gallois said Jan. 12 at a New Year's press conference here. "It is a strong signal for the USAF competition: the airplane is ready. We need only a balanced RfP to win again."

Asked what a "balanced RfP" meant, Chief Executive of EADS North America Sean O'Keefe said the current draft terms showed this "is not a tanker modernization program. It is a replacement of the existing KC-135 aircraft, which is a dramatically less capable aircraft than what they were requesting two years ago."

The current draft terms included 373 performance criteria, in which each criterion carried equal weight, he said. That meant an absence of "evaluation of any capability that exceeds what is requested as the baseline. The draft RfP is designed to be an exacting replacement of the KC-135, anything bigger, better, longer in range, more fuel efficient is of less value."

EADS also objects to what it sees as a failure to take account of development risk.

"The assumption is any aircraft that is offered in response to this particular draft is an aircraft of identical risk," O'Keefe said.

"That completely ignores that we have an aircraft that is flying today, is performing well. We can demonstrate its capabilities to perform that aerial refueling task and it is available now," he said.

Northrop Grumman has asked the DoD to reconsider the draft terms. U.S. Air Force officials have said the final RfP is expected to be issued at the end of this month.

"It could be a modernization of the tanker program," O'Keefe said. "We may have a fair, balanced competition that we and our partners may respond to."

In Chicago, Dennis Muilenburg, Chief Executive of Boeing's Defense, Space and Security Systems division, said Jan. 11 the company's offer was tailored to the expressed requirements.

"We've chosen a path that says we understand the war-fighter requirements - we're not questioning those requirements," Muilenburg said. "It's our job to respond with our best offering to meet those requirements; that's still our position."

EADS is eager to boost its defense side, and a win of the projected $35 billion U.S. KC-X tanker contract would be a strategic victory.

[buglerbilly]

Schwartz: Tanker Fixed Price May Change

Jan 20, 2010

By Amy Butler abutler@aviationweek.com
Washington


The U.S. Air Force chief of staff, Gen. Norton Schwartz, says that changes to the much-awaited request for proposals (RFP) for the next-generation aerial refueler will “lessen the financial risk” for bidders.

Boeing and a Northrop Grumman/EADS North America are expected to bid for the work, which could total about $35 billion for the purchase of 179 KC-135 replacements. However, Northrop Grumman CEO Wes Bush has threatened not to offer his team’s Airbus A330-based option in part because the fixed-price development contract included in the draft RFP issued last fall exposed the company to too much risk. Northrop Grumman officials say that if the draft RFP stands, about 20 percent of the items needed would be developmental and thus more difficult to price.

Boeing officials have expressed dissatisfaction at the fixed-price approach as well, though the team has not publicly threatened to walk away from the competition. Boeing is expected to propose a tanker based on a 767 platform.

Pentagon acquisition chief Ashton Carter says the rationale behind the fixed-price structure is to shift more of the burden of performance to the contractor.

Schwartz also characterizes the changes to the forthcoming final RFP as “modest,” and he adds that the fundamental requirements remain untouched in the forthcoming competition. He made his comments during a press roundtable at the 38th IFPA-Fletcher Conference on National Security, Strategy and Policy in Washington this morning.

Schwartz says the final RFP will be issued within a month of the fiscal 2011 budget release scheduled for Feb. 1. Industry sources say they are expected the document to be out the week of Feb. 8, most likely on Friday, Feb. 12.

[buglerbilly]

Ares

A Defense Technology Blog

KC-X Headed for a Sole-Source to Boeing?

Posted by Amy Butler at 2/1/2010 7:30 AM CST

After a Jan. 28 meeting with senior defense officials, Northrop Grumman executives continue to be resolute that the company is not likely to win the KC-X refueling tanker contract without major revisions to the draft request for proposals (RFP). And, it appears those changes aren't coming.

So, after spending over $100 million with teammate EADS North America to hock Airbus A330 based tankers to the U.S. Air Force (which was successful for a brief month last year prior to a Boeing-led bid protest), the companies are seriously considering pulling out of the competition, according to Loren Thompson, a prominent Beltway think-tanker and defense consultant.

Northrop is unhappy with the structure of the competition. It highlights 373 pass/fail requirements and a cost shootout. "Best value" parameters, such as fuel efficiency, only come into play if the two bids are within 1% of each other. Thompson says that the 767 (Boeing's likely platform) is roughly 20-30% less expensive than the A330 in the commercial market place. Though the Northrop team could buy back some of that delta with items -- such as a new refueling boom -- that are being developed for Australia (Boeing's boom will require NRE as it can't perform the high gallon per minute offload rate demanded by the C-5 airlifter), the cost differential is a worry.

So, if Northrop pulls out, the Air Force could sole-source the deal to Boeing (sounds a lot like 2002, right?). But, this is where the strategy of a fixed-price development gets interesting. Ashton Carter, Pentagon acquisition czar, chose a fixed-price development to reduce risk for the department if schedules aren't met. But, without a competition, he loses the leverage of low-cost bidding. So, Boeing could pad its bid with margin, win the fixed-price development and charge a high price without worry of being under bid -- THEORETICALLY.

So, we'll see.

The Pentagon hasn't yet issued its 15-day notice that the final RFP is coming out. Senior officials say by the end of February.

[buglerbilly]

DATE:01/02/10

SOURCE:Flight InternationalPICTURES: AWACS test boosts Australia's KC-30A tanker programme

By Craig Hoyle

The Royal Australian Air Force's first Airbus A330-based multirole tanker/transport has for the first time passed fuel to another large aircraft, moving the type closer to its delayed service entry late this year.

One of five RAAF-designated KC-30As on order, the modified airliner transferred almost 30t of fuel from its centreline boom to a French air force Boeing E-3F airborne warning and control system aircraft during two test flights conducted from Airbus Military's Getafe site near Madrid.

"This is a significant milestone in the programme," says Antonio Caramazana, vice-president and head of Airbus Military Derivatives. "The E-3 AWACS is a challenge because of its aerodynamics characteristics due to the large radome. The AWACS crew reported that the handling of the aircraft was very smooth during the refuelling operation." This was conducted at an altitude of around 20,000ft [6,100m] and at 250kt [460km/h], says Airbus.


© Airbus Military

Australia plans to accept its first two KC-30As in the fourth quarter of this year, with initial clearances being sought to refuel Boeing F/A-18A fighters and other KC-30As. The other three should follow in 2011-12, says Todd Russell, Madrid-based project team leader for its Defence Materiel Organisation.

The RAAF also wants its new tankers to progressively support operations with the F/A-18F Super Hornet, BAE Systems Hawk 127 advanced jet trainer, Boeing C-17 strategic transport and 737-based Wedgetail airborne early warning and control system aircraft, and eventually with the Lockheed Martin F-35 Joint Strike Fighter, he says.

Challenges facing the service's introduction of the KC-30A include maintaining air-to-air refuelling skills after having retired its last Boeing 707 in June 2008, and using a boom for the first time, Russell told IQPC's Air Tankers and Aerial Refuelling conference in London on 25 January. A training lag also exists because simulators for the new type will not be delivered until the first quarter of 2011, he says.

Meanwhile, the RAAF is also "having difficulties with defining the UARRSI [universal aerial refuelling receptacle slipway installation] clearance envelope," says Russell. Three of its aircraft are being equipped with boom-mounted instrumentation to support the work, he adds.

In addition to providing AAR services, Australia's KC-30As are also being configured to carry 272 passengers and below-deck freight.


© Craig Hoyle/Flight International

Russell also told the conference that Australia is proposing the formation a joint user group for air forces equipped with Airbus-derivative tankers. This would enable the partners to share operational lessons and discuss maintenance, certification and technical issues. The forum could also lead to agreements to "collaborate on software and hardware upgrades", he believes.

The joint user group proposal is being made to other A330 MRTT buyers Saudi Arabia, the UK and the United Arab Emirates, and to A310 tanker operators Canada and Germany. The A330 is also a candidate to meet requirements in nations including France, India and the USA.

[Unicorn]

WTF is a UARRSI [universal aerial refuelling receptacle slipway installation] in laymans terms?

[tiddles]

I think this blokes actions revolve around Pork for Alabama rather than any real concern for the U.S.aging tanker situation, but it might hurry things up a bit -maybe?
Tiddles
US Senator blocks all Obama nominees amid tanker feud
(AFP) – 1 day ago

WASHINGTON — A US Senator has taken the extraordinary step of blocking more than 70 of US President Barack Obama's nominees amid a dispute over a lucrative US Air Force tanker deal, senate aides said Friday.

Senator Richard Shelby, the top Republican on the Senate Banking Committee, placed a blanket "hold" in part because of the feud pitting Airbus parent EADS and its partner Northrop Grumman against Boeing, his office said.

"Senator Shelby is holding all of the president?s nominees pending on the Executive Calendar," a total of "70-plus" people, said a spokeswoman for Democratic Senate Majority Leader Harry Reid, Regan Lachapelle.

The US Senate frequently approves non-controversial nominees without a formal roll-call vote, with a "unanimous consent" determination that can be blocked by just one senator, requiring a time-consuming process and 60-votes in the 100-seat chamber to overcome.

Shelby "has placed holds on several pending nominees due to unaddressed national security concerns," his spokesman, Jonathan Graffeo, said in a statement that cited the tanker dispute as a key reason for the move.

The European Aeronautic Defence and Space Company and its rival Boeing have been locked in a long-running rivalry to win a 35-billion-dollar contract for a fleet of new aerial refueling tankers.

The EADS/Northrop partnership would build the airplane in Shelby's home state of Alabama but have accused the Pentagon of favoring Boeing in a draft request for proposal and warned they may withdraw from the competition.

"Nearly 10 years after the US Air Force announced plans to replace the aging tanker fleet, we still do not have a transparent and fair acquisition process to move forward," said Graffeo.

"The Department of Defense must recognize that the draft Request for Proposal needs to be significantly and substantively changed," said the spokesman.

Shelby is also "deeply concerned" that Obama may block the construction of an FBI center in Alabama to test improvised explosive devices -- the "roadside bombs" that have killed hundreds of US soldiers in Iraq and Afghanistan.

"This decision impedes the US military, the intelligence community, and federal law enforcement personnel in their missions to exploit and analyze intelligence information critical to fighting terrorism and ensuring American security worldwide," said Graffeo

[McDethWivFries]

WTF is a UARRSI [universal aerial refuelling receptacle slipway installation] in laymans terms?

would've thought that would be the 'dent' in the plane that the refuelling nosel sits in. you know how they have that groove type dent that funnels down to the nosel?

[tiddles]

The hold that Shelby had on Obamas nominees has not lasted long. Original story is on post 7 of this thread.
Tiddles
Shelby releases holds on Obama nominees
By Jordan Fabian - 02/08/10 08:08 PM ET
Sen. Richard Shelby (R-Ala.) on Tuesday announced the release of holds on almost all pending nominees the Obama administration has sent to the Senate.


Shelby's decision to lift his wide-ranging hold means that the Senate can now vote on the nominees. As a result of the holds placed late last week, the Senate could not take action on the nominees unless it was is broken using a cloture vote that requires 60 senators or if the senator lifts the hold.


Shelby's move had affected over 70 nominees, according to Majority Leader Harry Reid's (D-Nev.) office.



Shelby had placed the holds in protest of the administration's handling of defense and counterterrorism projects slated for his district. The White House had decried the Shelby's hold as "opposition for opposition's sake."


"The purpose of placing numerous holds was to get the White House’s attention on two issues that are critical to our national security – the Air Force’s aerial refueling tanker acquisition and the FBI’s Terrorist Device Analytical Center (TEDAC)," said Shelby spokesman Jonathan Graffeo in an e-mail. "With that accomplished, Sen. Shelby has decided to release his holds on all but a few nominees directly related to the Air Force tanker acquisition until the new Request for Proposal is issued."

Shelby applied the holds because of a dispute over a contract to build Air Force refueling tankers. The original deal was awarded to Northrop Grumman, which would have constructed the planes in Mobile, Ala.


But Boeing protested the award to the Government Accountability Office, which negated the deal in a report that faulted the Pentagon's selection process.


The Pentagon then reopened the competition, but Northrop has argued that it has given Boeing an unfair advantage in that process by disclosing price information to Boeing. It has threatened to pull out of the competition, and has been conducting a lobbying and public-relations campaign criticizing the competition.

Shelby was also not happy with the Obama administration's decision to hold back funding for an FBI facility in Alabama dedicated to research on explosives used by terrorists.

Though holds on nominees are commonly used to protest unrelated issues, blanket holds occur less frequently and affect a wider swath of nominees.

Graffeo said that Shelby did not object to the nominations of uniform military personnel, federal judges, or Treasury nominees. He added that Shelby still has holds on threeObama administration nominees: Terry Yonkers, Assistant Secretary of the Air Force, Frank Kendall, Principal Deputy Under Secretary of Defense for Acquisition, Technology, and Logistics and Erin Conaton, Under Secretary of the Air Force.

[buglerbilly]

USAF Sets Tanker RFP Release Date

By JOHN REED

Published: 9 Feb 2010 17:13

After months of delays, the U.S. Air Force intends to release the final request for proposals on the $35 billion KC-X tanker competition "not earlier than" Feb. 23, according to an Air Force pre-solicitation notice released Feb. 8.

The final RfP was originally due Nov. 30. However, on Dec. 1 Northrop President and CEO Wes Bush sent a letter to Pentagon acquisition chief Ashton Carter threatening to drop out of the competition unless changes were made to the draft RfP. Bush complained that the early, cost-focused version of the solicitation heavily favored rival Boeing's smaller, cheaper 767-based offering over Northrop's Airbus A330-based bid.

Both competitors have also complained about the fixed-price nature of the contract, which calls for tankers to be delivered over several decades.

Soon after Bush sent his letter, the Pentagon announced that it was delaying the release of the final RfP until January so it could take the time to address complaints from KC-X competitors Boeing and Northrop Grumman-EADS. Over the last several months, high-ranking Pentagon and Air Force officials have insisted that they will make no major changes to the RfP. Just last week, Defense Secretary Robert Gates confirmed that the Pentagon will move ahead with the competition with or without Northrop's participation.

[buglerbilly]

DATE:09/02/10

SOURCE:Flight International

USAF issues KC-X update, ignores Northrop demands

By Stephen Trimble

The US Air Force has issued a "presoliciation notice" for the KC-X tanker contract that suggests at least two of the three changes demanded by the Northrop Grumman/EADS North America team will not be incorporated in the final request for proposals (RFP).

The notice released on 8 February on the Federal Business Opportunities web site precedes the publication of the final RFP, which the notice says will not occur before 23 February.

The USAF plans to award a fixed-price contract for the four-year development phase, the notice says.

Northrop and EADS executives have demanded that the USAF adopt a traditional "cost-plus" contract policy for KC-X, arguing the fixed-price plan makes the contractor assume all of the risk of schedule delays and cost overruns.

For its part, Boeing supports the USAF's fixed-price approach for the KC-X development phase. "Even though it's [a] firm-fixed-price [strategy], I believe there is shared risk," says Chris Chadwick, president of Boeing Military Aircraft, speaking on 3 February at the Singapore Airshow.

The notice also appears to indicate that the performance requirements for the KC-X aircraft will be based on the existing KC-135R. For example, the USAF calls for a fuel offload capability "at least as good as the KC-135R".

The USAF's decision to make the KC-135R the baseline for its desired performance for the KC-X tanker has raised concerns for the Northrop/EADS team, which is proposing the KC-45 (formerly known as KC-30). The tanker version of the Airbus A330-200 airliner is significantly larger than the Boeing KC-767, which is one of the aircraft Boeing could propose. Both aircraft are larger than the KC-135R.

How the final RFP will address the Northrop-led team's third major concern is left unclear by the presolicitation notice. Northrop executives have criticized the draft RFP for evaluation criteria heavily focused on price, calling the strategy a "race to the bottom".

The presolicitation notice says the contract will be awarded on a "best value" basis, in which price can be balanced against performance and risk.

Northrop is not backing off of its threat to withdraw from the competition.

"Northrop Grumman feels that the draft RFP, as structured, fails the test of true competition and, without a responsive set of changes, is not an RFP to which Northrop Grumman can respond," the company says in a statement.

Boeing referred questions about its response to the presolicitation notice to a statement posted on its tanker blog on 9 February.

"We must offer and deliver an American designed and built combat-ready tanker at the lowest cost to the taxpayer," Boeing says. "And in 15 days, Boeing will do just that."

[McDethWivFries]

is it just me or is this looking more and more like a 'competition' designed to be won by Boeing?

[Gubler, A.]

is it just me or is this looking more and more like a 'competition' designed to be won by Boeing?

Not just that. But designed to be won by Boeing with the off the shelf 767 tanker with no need to develop the 777 or 787 tanker options.

[McDethWivFries]

Just so i get it straight in my mind, was the previous competition that was won by Northrop/EADS a 'cost plus' type senario similar to what they are wanting it changed back to?

[Unicorn]

Yes, the previous contest was cost-plus.

Northrop Grumman / EADS are pissed off because the USAF disclosed to Boeing, when they informed Boeing of the winning NG / EADS bid, of the price that was proposed for the A330-derived aircraft.

Thus Boeing was given access to the NG / EADS bid, including actual cost data, however NG / EADS was refused access to Boeing's bid details when the contest was declared void.

Thus Boeing is bidding in a lowest price = winner take all competition already knowing NG / EADS costs.

Now you can see NG / EADS believe that the dice are very firmly rigged against their winning this contest.

Unicorn

[buglerbilly]

Published: Wednesday, February 10, 2010

Boeing now favored to win tanker, experts say

Everett-built KC-767 likely will be Air Force’s choice, aviation experts say

By Michelle Dunlop, Herald Writer

LYNNWOOD — Three out of three analysts agree: The Boeing Co. likely will land the U.S. Air Force tanker contract.

“Boeing will get the first round,” said Michel Merluzeau, managing partner with G2 Solutions. Boeing’s “767 is going to be the winner of a competition.”

Merluzeau spoke Tuesday at the Pacific Northwest Aerospace Alliance annual conference in Lynnwood. Analysts Richard Aboulafia, with the Teal Group, and Scott Hamilton, with Issaquah-based Leeham Co., also agreed that Boeing is poised to win the roughly $35 billion tanker contest. Doing so would secure Boeing jobs on the 767 line here in Everett for years into the future.

Boeing is competing against duo Northrop Grumman and EADS for the contract to replace the Air Force’s aging KC-135 aerial refueling tanker fleet. The Air Force said Monday that it won’t release its final requirements until Feb. 23 at the earliest. This is the Air Force’s third try at awarding the contract, and it’s the first in a series of three competitions the Pentagon plans to hold.

Boeing’s chances at winning the tanker contract could get a significant boost if Washington’s Rep. Norm Dicks succeeds Rep. John Murtha, D-Pa., as chairman of a powerful House appropriations defense subcommittee. Murtha, who died Monday, had been a strong supporter of splitting the Air Force contract between Boeing and Northrop.

Murtha’s death “was the tipping point,” the Teal Group’s Aboulafia said. “This is ... a slam dunk” for Boeing.

Dicks is now the senior Democrat on the committee and is expected to be chosen by the House Democratic Caucus to succeed Murtha. He is a strong Boeing supporter and the company is atop the list of his campaign contributors, according to the Center for Responsive Politics. Northrop Grumman was also a major Dicks contributor, according to the nonpartisan organization.

Boeing offered the Air Force a tanker based on its Everett-built 767 jet in the last contest. The Air Force, however, initially selected the larger KC-30 tanker, based on an Airbus A330 airplane, offered by Northrop and EADS. But the Pentagon halted the contract after government auditors found flaws in the contest.

The Air Force released a fresh draft of requirements for the tanker last fall. Northrop’s chief executive Wes Bush has complained that the new rules favor Boeing’s smaller KC-767 aircraft. The company has threatened to drop out of the competition unless the Pentagon makes significant changes to the final requirements.

Analyst Hamilton doesn’t think the Air Force will make those changes. He agrees with Northrop’s Bush that the Air Force seems to want Boeing’s KC-767 this time around.

“I do think there is a high likelihood that Northrop will not bid,” he said.

That would pave the way for a Boeing win. Defense Secretary Robert Gates told members of Congress last week that the contest will proceed even if Northrop and EADS drop out.

Although Northrop looks to be on the losing end of this contest, don’t count the defense contractor or the KC-30 out of future contests, Merluzeau said. The Air Force showed a clear preference for the KC-30 in the previous round, he said.

“I don’t think the KC-30 will go away,” he said.

[Milne Bay]

Published: Wednesday, February 10, 2010

Boeing now favored to win tanker, experts say

Everett-built KC-767 likely will be Air Force’s choice, aviation experts say


Wooooah - now that's a surprise - not!

and what is this supposed to mean?

Although Northrop looks to be on the losing end of this contest, don’t count the defense contractor or the KC-30 out of future contests, Merluzeau said. The Air Force showed a clear preference for the KC-30 in the previous round, he said.

“I don’t think the KC-30 will go away,” he said.

[Deks]

Werll the USAF has been operating a mixed fleet of KC-135s and KDC-10's for a while now, so it's entirely possible that KC-30's will be purchased in the future.

[Unicorn]

I doubt it, Boeing will bid KC-777 tankers for the KC-10 replacement and the same protectionist crap on the Hill will see the 7777 win no matter what.

Unicorn

[McDethWivFries]

I doubt it, Boeing will bid KC-777 tankers for the KC-10 replacement and the same protectionist crap on the Hill will see the 7777 win no matter what.

Unicorn

funny thing about that is i remember reading an article that showed the NG/EADS bit was more 'American' than the Boeing bid with the majority of parts being constructed in the US where as Boeing had a higher proportion produced over seas. Might've seen that on the old T5C forums.

[Chunder]

Long since concluded that politics would rule the day. It seems like a horrendously bad decision and one in which US Aerial operations will be paying a heavy price for over the next (50) odd years. For EADS/Northrop not to bid probably puts the business case of tendering on Cost moot. I am sure there is disappointment for the few that wanted to see the US arms market be competitive But idiots get what idiots deserve in the framing of the competition. I am sure the those extra litres & freight capacity will be priceless for the RAF/RAAF in the coming years.

[JKM Mk2]

Well, this whole sorry saga ain't over by a long shot IMHO. As soon as Boeing is declared the winner you can expect a NG/EADS protest to the GAO which could very well be upheld. There could also be the possibility of legal action as the RfR was obviously biased in Boeings' favor. Also not to mention are all the possibilities of congressional interference and inquiries. This mess is really going to test Obama's skills as a negotiator!

JKM

[Chunder]

For all it's (sorry I have to use the phrase to make a point) "Net. Centric Warfare" of the combined services, it would seem that the U.S contest is dramatically void of what a decent aerial refuelling capability would do for the Marines / Navy that can complement & extend operations - let alone compliment airlift. Sure they have gone one step with Probe/Drogue but get the three legged hound to lead the hunt because of attachments IMO. If it was a cross service capability with cross service requirements included in the RFP - the writing would be on the wall for the 767. But this is the thing JKM. ANY perceived re-writ of the competition is undoubtedly going to be up for protest. The idiots will get what the idiots deserve. A good platform would reshape not just the USAF's but USN's potential t to a degree whereas a simple platform replacement requirement always was going to blunt the competition potential the fact this seems completely omitted from any proceedings seems to me that the US armed services are getting reamed by their own people - that is probably being too nice.

[buglerbilly]

Pentagon will consider changing fixed-price tanker rules

Pentagon officials Thursday put in writing a pledge to revisit fixed-price requirements for the aerial refueling tanker request.

Executives from both Boeing and Northrop Grumman have complained that the draft request's provisions for an 18-year, fixed-price contract put too much risk on the bidders because the planes aren't fully developed and it's pretty much impossible to predict costs 18 years out.

Pentagon officials have countered that the tankers use mature technologies, but have said they would revisit the criteria. They addressed the issue in writing Thursday, in their latest batch of answers to questions from potential bidders, Pentagon officials.

Specifically, the Pentagon addressed questions about the 18-year, fixed-price term.

"Contractors, and their suppliers, do not establish rates or business models that far into the future, and will be forced to become speculative in nature on a number of cost elements," a potential bidder wrote, asking: "Why does the USAF believe that contractors can sufficiently estimate their costs that far into the future."

In response, the Pentagon wrote: "The government will consider restructuring the production options to reduce contractor risk."

Pentagon officials so far have resisted calls from Northrop and its main tanker partner, EADS, to revise criteria they say skew the request toward of Boeing's smaller 767-based tanker and against their Airbus A330-based offering. Northrop officials have said they won't bid without such changes.

The Air Force has said it will release a final tanker request for proposals as soon as Feb. 23

[buglerbilly]

UPDATE 2-U.S. Air Force sees tanker terms by end Feb.

Thu Feb 18, 2010 2:42pm EST

By Andrea Shalal-Esa

WASHINGTON, Feb 18 (Reuters) - The U.S. Air Force said on Thursday it expects to issue final terms for a heated aerial tanker competition next week, and is bracing for a possible sole-source bid from Boeing Co (BA.N).

"We are not walking blindly into a situation where we just have one potential offerer," Lieutenant General Mark Shackelford, military deputy in charge of acquisition for the Air Force, told a defense conference hosted by Aviation Week.

He said the Air Force had interacted "to a great extent" with both companies to understand their concerns about draft rules for the competition, but was being careful not to "change anything that potentially favors one competitor over another."

Northrop Grumman Corp (NOC.N) has said it will not bid unless the Air Force makes significant changes to a draft request for proposals released in September.

"We can't force them to compete, nor are we willing to make a change in the process solely to their advantage. That's part of the walk-down-the-middle philosophy," Shackelford told reporters after his remarks. He said a final request for proposals was expected between Feb. 23 and month's end.

Geoff Morrell, Pentagon press secretary, said certain adjustments were being made, but rejected any suggestion that the changes were intended to "favor one party or another."

"I can tell you definitively that couldn't be further from the truth. We are trying to be as fair as humanly possibly about this competition," Morrell told reporters, adding that the revised rules should be released in the "coming weeks."

"Our only goal here is to get our warfighters a new tanker... and to get the taxpayers the best deal for their money. We don't have a dog in this fight otherwise. We don't care who wins," he said.

Shackelford, asked how the Air Force could avoid cost increases and other problems associated with past sole-source acquisitions, said the Air Force would have access to detailed information that would allow it to judge the realism of any proposal submitted and structure the contract accordingly.

He said the Air Force also had insight into likely costs since the planes were derivatives of commercially sold aircraft. "So this is by no means a 'sky is falling' scenario if we wind up with one offerer," he said.

This is the Air Force's third attempt to begin replacing its aging fleet of 50-year-old aerial tankers, which refuel fighter jets and other warplanes in mid-flight.

Congress scrapped the first plan, a $23.5 billion deal under which the Air Force planned to lease and then buy 100 Boeing 767-based tankers, amid a major procurement scandal that sent a former Air Force official to prison.

The Pentagon canceled its second attempt after government auditors upheld a Boeing protest against a projected $35 billion contract awarded to Northrop and its European partner EADS (EAD.PA) in February 2008.

The Air Force told the companies last week that it was sticking to its plans for a fixed-price type contract for development of the new planes, and bids would be due 75 days from the date of the final request for proposals.

The service intends to pick a winner in the fourth quarter of fiscal 2010, which ends Sept. 30.

(Reporting by Andrea Shalal-Esa and Adam Entous; Editing by Gerald E. McCormick, Phil Berlowitz)

[buglerbilly]

$2 billion air tankers on Government hit list

By Ian McPhedran

From: The Daily Telegraph February 19, 2010 12:00AM

A PROJECT worth $2 billion to provide the RAAF with five Airbus multi-role tanker planes has been quietly added to the Government's feared "defence projects of concern" list.

Despite fanfare that a $2.5 billion Collins Class submarine maintenance contract topped the list and a troubled $1.4 billion frigate upgrade was erased, junior Defence Minister Greg Combet refused to confirm European contractor Airbus Military was on the list of shame.

Insiders told The Daily Telegraph the project was definitely the latest entrant but for commercial reasons the Government would not admit it.

Mr Combet's spokesman refused to confirm or deny the project's status and said only that it had not been "declared" a project of concern.

"It is something that we are closely monitoring," the spokesman said.

The list includes overdue projects such as the Wedgetail airborne early warning aircraft, anti-ship missiles, lightweight torpedoes and medium and heavy vehicle contracts worth billions.

The multi-role tanker transports (MRTT) are modified Airbus A330 long-range airliners built in Europe by Airbus Defence Industries and modified by Qantas Defence at Brisbane Airport.

The project is running 18 months late due to technical delays and according to the Australian National Audit Office the lost time will not be recovered due to the complex conversion task.

"The scheduled forecast for FOC (final operational capability) has slipped by 18 months from the original plan primarily caused by delays to the development, certification and qualification of the first of type aircraft," the latest audit report said.

"Delays will impact the introduction into service of the new MRTT capability and delay achievement of the expected operational readiness."

The first aircraft, due in 2008, will not be in service until later this year.

The KC-30A carries 111 tonnes of fuel in wing tanks leaving the fuselage free for 42 pallets of cargo or 272 passengers. Its top take-off weight is 233 tonnes.

The RAAF has no aerial tankers after the last of its Boeing 707 fleet was retired in late 2007.

[buglerbilly]

New power lobby emerges for KC-X split buy

By Stephen Trimble on February 22, 2010 6:45 PM

Source: http://www.buildthemboth.ccm

Just when you might think the "split buy" idea for KC-X is dead and buried, it seems to be back today.

A self-described non-partisan coalition called American Jobs Now! has launched a well-funded push on Capitol Hill called "Build Them Both". This is not a fly-by-night lobby group. Carrie Giddens, formerly communications director for the Iowa Democratic Party during the 2008 presidential election, is the newly-hired organizer. The group also published full-page advertisements in Politico (which published today) and tomorrow in The Hill newspaper. The ad says a split buy "will speed the delivery", "retire an outdated fleet" and "will save taxpayers" money. Above all, the split buy will create "100,000 new US jobs".

Let's put our questions about those facts aside, just for the moment. (Not to get nit-picky, but surely a single project to build, at most, 25-30 aircraft a year will not consume one-seventh of the US aerospace workforce. Besides - wink, wink - those 100,000 aerospace workers are already busy building the last 40 F-22s.)

The big question, of course, is which side is this group on? The web site is no help. It shows images of both the KC-767 and KC-45. The site's domain is registered to Domains by Proxy, an anonymous service.

According to Giddens, the answer is neither. She told me today the group has reached out to Northrop, Boeing and their suppliers for support and funding, but have not yet received any. They group chose to focus on the tanker contract, she says, because it's the quickest way to create jobs in the US economy. "The goal really is jobs," she says. "Let's end the decade-long political spat."

That raises the question: Which lawmakers are on their team? The most outspoken advocate for a split buy is dead. But even the late Representative John Murtha appeared to have given up on the idea last year. At the moment, no lawmaker is actively supporting the group's efforts, Giddens says.

So it's apparently a well-funded group with no political or industrial champions, launching a well-timed lobbying push with purely economic motivations? If you believe that, I've got 100 KC-767As to lease you.

[buglerbilly]

Can the Air Force Finally Buy a New Gas-Passer?

By Nathan Hodge February 23, 2010 | 4:20 pm



For the Air Force, acquiring a new fleet of aerial refueling tankers has been nothing short of a nightmare, a nearly nine-year drama that hasn’t brought the service any closer to replacing its Eisenhower-era KC-135 tankers. For snarky defense reporters, it’s been a dream: The story has included backroom deals, dramatic political hearings, even prison sentences.

Tomorrow, the Air Force is set to launch a new request for bids to build a new fleet of aerial refueling tankers. At stake? As much as $35 billion in new orders. The current Air Force five-year spending plan proposes to spend $11.7 billion on a first batch of flying gas tanks, including research and development costs. If all goes to plan, the service plans to buy 179 aircraft over the life of the program.

In February 2008, Northrop and its European partner EADS won a tanker contract, but rival Boeing successfully contested the award. In a congressional hearing this morning, Air Force Secretary Michael Donley said that top defense officials would brief lawmakers tomorrow on the details of the contract. According to Reuters, Donley said the service decided to “lock down the details” after the Government Accountability Office overturned the results of the previous contest.

The new competition may be equally contentious: Bloomberg notes that Northrop CEO Wes Bush has threatened to pull out of the contest unless the draft request for bids was revised to the company’s satisfaction. In a letter last year to Ashton Carter, the Pentagon’s top weapons buyer, Bush complained that the draft request for proposal (RFP) was skewed in favor of Boeing.

So! Can we expect a final award this time, or will this story continue to keep defense journalists gainfully employed? Should Danger Room relaunch a contest to name the aircraft? Speaking yesterday to reporters, Secretary of Defense Robert Gates said: “We are very hopeful that we will have two competitors. And we think that it is a very fair RFP.”

[PHOTO: U.S. Department of Defense]

[buglerbilly]

USAF To Brief Congress on Final Tanker RfP

By john reed

Published: 23 Feb 2010 14:52

The U.S. Air Force will unveil to lawmakers Feb. 24 the final version of its request for proposals for the $35 billion KC-X tanker competition, top service officials said Feb. 23.


U.S. Air Force Chief of Staff Gen. Norton Schwartz said Feb. 23 that the request for proposals for the KC-X tanker bid would be released in the coming days. (FILE / U.S. AIR FORCE)

"We'll be prepared, actually [Feb. 24], to roll out the RfP," Air Force Secretary Michael Donley said Feb. 23 during a House Armed Services Committee hearing. The secretary added that he and Pentagon acquisition chief Ashton Carter will brief lawmakers on the solicitation.

Earlier in the hearing, Air Force Chief of Staff Gen. Norton Schwartz said that the RfP will be released within days. Industry then will have 60 days to offer their bids. After that, the Air Force expects to award a contract for the new tankers sometime this summer.

While Donley declined to go into the specifics of the RfP, he and Schwartz both said repeatedly that they "take issue" with Northrop Grumman-EADS criticism that claims the document is skewed in favor of Boeing and its 767-based offering, which is smaller and less expensive than the Northrop Airbus A330-based bid. Northrop has gone so far as to threaten to drop out of the competition unless significant changes are made to the final RfP to account for the increased performance of their larger aircraft, which is based on a newer design than the 767.

Donley and Schwartz also repeatedly stated during the hearing that splitting the purchase of tankers between the two defense giants would not be feasible given today's tight budget environment. Any such move would substantially increase the number of tankers the service would have to buy each year.

While Donley and Schwartz would not discuss any major changes that have been made to the cost focused-draft RfP, the Air Force's top uniformed acquisition officer, Lt. Gen. Mark Shackelford, said that the service has been paying attention to both Boeing's and Northrop's concerns to "the extend we could."

In addition to Northrop's complaint that the RfP is skewed toward a cheaper airplane, both companies are uneasy with the fixed-price nature of the solicitation for a contract that will have the winner delivering airplanes for decades to come.

Shackelford did not comment on any changes to the contractual structure of the RfP.

[buglerbilly]

Ares

A Defense Technology Blog

KC-X -- Game on Again

Posted by Amy Butler at 2/23/2010 2:02 PM CST

Looks like all signs are pointing to a KC-X final RFP release tomorrow.

I'm told Congress will be briefed in the morning, and a press conference is expected tomorrow morning.

So, here is a short list of things I hope to finally find out:

1. What concessions are being made to make good on USAF Chief of Staff Gen. Norton Schwartz's mention that the contracting structure will provide some financial relief to bidders? The draft RFP called for fixed price.

2. Will all 373 requirements be equally weighed as they were in the draft RFP? This was at the core of Northrop Grumman/EADS's threat not to bid, because the larger A330 has a hard time stacking up when "extra credit" items, such as additional range or fuel offload, are not taken into account.

3. Will they rejigger how they judge the bids IF they come within 1% of each other? This is where NG thinks they can gain ground to reclaim the contract.

4. Will the Pentagon change how they plan to look at fuel burn? Apparently the draft RFP focused on training sorties and lots of touch-and-gos, and the complaint was that this did not represent operations closely enough.

5. Why is the final RFP planning to give 75 days rather than 60 days to respond?

6. Will it primarily remain a cost shootout? No matter which way you slice it, if you use equally weighed requirements as a pass/fail and then have cost as your discriminator, I don't see how you can call the competition "best value." It didn't work that way for BAMS ... so it'll be interesting to see whether this is described by DoD as a cost shootout or a best value deal.

7. Will there be a proper risk assessment included in the RFP, or will there simply be the pass/fail? This is a risk area for USAF ... if they get mired in a risk assessment, it could be an area for a protest. But, if they don't, they could pick a provider that will have trouble delivering on the refueler specific mods.

If the RFP isn't to Northrop's liking (again), it seems the only option the company has if it wants to try and stay in the game is to protest the RFP. There is a process for this, and it would be handled -- like bid protests -- by the GAO.

If the company announces a no-bid, seems they would lose any leverage. And I'm told the money spent so far on the bid is well above the tens of millions range.

Finally ... will Boeing just come out and say they are officially doing a 767 and what it looks like? The best way to shake the Frankentanker monkey on the company's back is to show us what they will bid, and how it is a much simpler design than the last go-around.

Let the games begin!

[buglerbilly]

Tanker RFP Includes Some Changes

Feb 24, 2010



By Amy Butler abutler@aviationweek.com

The changes to the contract pricing structure of the KC-X program will be announced later today by the Defense Dept., according to slides of a tanker presentation obtained by Aviation Week.

Both Boeing and Northrop Grumman/EADS North America, the two would-be competitors, complained that the fixed-price demand by the Pentagon for the production lots placed too much risk in the contractor’s lap. Based on the draft request for proposals (RFP) from September 2009, the first five lots would have been locked in at a fixed price.

Now, however, the pricing structure allows for fixed price for only Lots 1-2. Inflation adjustments are now allowed for Lots 3-13.

Pentagon officials say the fixed-price incentive contact structure for the development phase remains as described in the draft RFP. However, more information on the allowances of this structure are coming to light than previously disclosed by defense officials, including a breakdown of how additional costs would be funded if they crop up in the development phase. “The contract geometry is a 60/40 (government to industry) share ratio with a 125% ceiling and a 12% target profit,” according to the briefing. “ This is ample protection to cover potential integration risk during the [development] phase.”

The Pentagon still plans to conduct a pass/fail review of the mandatory requirements. This strategy was criticized by Northrop and EADS officials who said it dumbed down the competition to favor the least capable aircraft. The briefing notes some changes to those requirements.

The Large Aircraft Infrared Countermeasures will now be government furnished rather than included in the contractors’ prices. Also, the requirement for a microwave landing system, which aids with night or bad weather landings, has been eliminated. Officials say the system is no longer needed. Also, adjustments were made to the quick-start requirements and those for the non-ozone depleting fire suppression systems onboard.

Overall, Pentagon officials are expected to characterize the competition as “best value,” though the 1% price gate will still be in place. This means that additional factors that Northrop sees as advantageous to its offering will not be considered unless the two proposals are within 1% of each other on price. Air Mobility Command, which will operate the aircraft, “does not want to pay a significant premium for non-mandatory requirements,” the briefing says. “The department believes that the anticipated value of the 1% gate (potentially in the $300-500 million range) is a reasonable amount to pay for these non-mandatory requirements.”

Northrop and EADS officials had also complained that the draft RFP did not provide a subjective review of program risk, exposing the government to additional cost if a bidder offers an overly ambitious low price.

Defense Dept. officials still plan to use a pass/fail structure of assessing whether bidders can meet the basic requirements of the system. “To be rated acceptable in technology maturity, potential offerors must substantiate that all critical technologies are at readiness level of at least 6 [or tested in an operationally relevant environment], along with an approach to maturing technologies to a level 9,” the briefing says.

Officials say that the systems engineering and technology maturity risk “will be low because both expected offerors have built and tested tankers for international customers,” according to the briefing.

The desired fuel offload rate from the boom is also expected to stay the same at 1,200 gallons per minute (GPM). Boeing officials had questioned this area, but Air Force officials do “not want the KC-X to have less capability than the KC-135” in this area. The KC-135’s boom offers 1,176 GPM offload.

Jean Chamberlain, the vice president of Boeing’s tanker program, says Boeing has been working on a boom that can meet the requirement, but a prototype will not fly until the development phase of the tanker program. EADS’s boom offered for Australia and other nations, which is now in flight testing, can meet the requirement.

Though Boeing has not formally stated whether it would offer a 767- or 777-based tanker, these requirements point squarely to using the 767 as a baseline to monopolize on the reduced cost of the smaller platform.

Air Force officials still plan to buy 179 tankers through KC-X to replacing aging KC-135s. The first deliveries are expected in 2015 with initial operational capability in 2017.

Offerors will have 75 days to respond, and the government will review the proposals for 120 days prior to selecting a winner if there is a competition. Northrop CEO Wes Bush threatened not to bid in a Dec. 1, 2009, letter to the Pentagon because of the company’s qualms with how the competition would be judged.

Initial reaction from Capitol Hill has fallen along predictable lines. Sen. Patty Murray (D-Wash.), a vocal Boeing proponent, appeared pleased with what she learned in congressional briefings. “Our state and nation need this contract now more than ever,” she said in an emailed statement. “The bottom line is that the tanker brings jobs.”

Sen. Richard Shelby (R), whose Alabama state would be home to final assembly work on the earlier Northrop-EADS plan, slammed defense officials for not changing the RFP enough. “The final RFP discredits the integrity of the entire process,” he said on Senate Web site. “Additional capabilities that would better protect the lives of our men and women in uniform were neglected in the draft RFP. Substantial changes that bring those factors into consideration in the final RFP are necessary to have a full and transparent competition, yet the Air Force did not make a single revision to the key warfighter requirements.”

- Amy Butler ~abutler@aviationweek.com

Photo credit: Northrop Grumman

[buglerbilly]

Powerpoint Presentation aligned to this new RFP.............

http://aviationweek.typepad.com/files/27391962-tanker-rfp-final-power-point.pdf

[buglerbilly]

Tanker RfP Buoys Boeing Backers, Dismays Northrop Allies

By william matthews

Published: 24 Feb 2010 17:49

Boeing supporters in Congress were upbeat and Northrop Grumman partisans were glum following a U.S. Defense Department briefing on the latest Air Force plans to order new aerial refueling tankers.

During morning briefings for lawmakers Feb. 24, it became clear that the Air Force has made few changes of substance to the requirements it set last fall for a new fleet of tankers. In December, Northrop complained that those requirements favored Boeing, and warned that unless they were changed, Northrop and its partner, Europe's Airbus, might not compete for a $35 billion contract to build 179 refueling planes.

After hearing details of the Air Force's new request for proposals (RfP), Rep. Todd Tiahrt, R-Kan., said he was "cautiously optimistic." Some of the work on Boeing tankers would be done in Kansas, and Tiahrt has been an unabashed Boeing supporter.

"This is not the RfP I would have written," Tiahrt said, but the Pentagon "made the right decision in rejecting the narrow interests of a foreign company."

Tiahrt said he wanted the RfP to "account for the illegal subsidies" that Airbus received from European governments. The subsidies give "the French tanker a hidden cost advantage," he said.

In contrast to Tiahrt ebullience, Sen. Richard Shelby, R-Ala., fired off a statement in bold-face type declaring that "the final RfP discredits the integrity of the entire process."

Alabama stands to benefit if Northrop wins the tanker contract because a new aircraft plant would be built in Mobile and thousands of workers would be hired to assemble the tankers there.

"Capabilities that would better protect the lives of our men and women in uniform were neglected in the draft RfP" and in the final version, he said. "The Air Force did not make a single revision to the key war-fighter requirements."

Shelby said that "the RfP clearly favors a smaller, less capable airframe." The plane Boeing is expected to offer the Air Force is smaller than the one offered by Northrop and Airbus.

"I am concerned that the Defense Department may not get two competitive bids in this process," Shelby said.

Sen. Jeff Sessions, R-Ala., added to Shelby's denunciation.

"This solicitation has been doctored to such a degree," Sessions said, that Northrop may drop out of the competition fearing that the RfP precludes it from winning. A Northrop-Airbus withdrawal "would be tragic for the military and for U.S. taxpayers," he said. "We know from experience that sole-source bidding leads to less capability, more costs and more fraud."

Sen. Patty Murray, D-Wash., focused on the jobs that a Boeing win would bring to her state.

"The bottom line is that the tanker brings jobs, not only on the assembly lines in Everett, but also to aerospace suppliers and businesses large and small across our state and nation," she said. "Especially now, America's tanker should be built by America's workers."

Nearly Decade-Old Process

The effort to supply the Air Force with new tankers is nearly a decade old.

It began in 2001, when the Air Force and Boeing developed a plan for the Air Force to lease and eventually buy 100 new Boeing tankers.

That effort collapsed in 2003 after Boeing hired Darleen Druyun, the senior Air Force contracting official who arranged the lease. Druyun and Boeing's chief financial officer, Michael Sears, were convicted of conflict-of-interest law violations and served prison sentences over the matter.

In 2005, Northrop teamed with Airbus in a revived Air Force effort to acquire new tankers. And in 2008, Northrop won a tanker contract.

Boeing promptly protested the award, and four months later the Government Accountability Office voided the contract, agreeing with Boeing that the Air Force had bungled the competition.

Defense Secretary Robert Gates halted Air Force attempts to promptly replay the Boeing-Northrop tanker contest, saying it had become too politically charged.

A year of cooling off led to a draft RfP last fall and the final one issued Feb. 24.

[buglerbilly]

Final Tanker RfP Keeps Evaluation Plans, Features Only 'Technical' Adjustments

By JOHN T. BENNETT

Published: 24 Feb 2010 12:34

Senior U.S. defense officials told lawmakers today they will keep the scheme proposed in September to evaluate industry bids for a 179-plane, $35 billion aerial tanker contract, while adding that they have made hundreds of changes to the requirements and contract structure that will guide the KC-X competition.

In a morning briefing to lawmakers, Deputy Defense Secretary William Lynn, Pentagon acquisition executive Ashton Carter and Air Force Secretary Michael Donley "stressed that the changes made to the draft were primarily technical," said a congressional source with knowledge of the session.

The presentation, obtained by Defense News, summarizes what was briefed this morning to lawmakers. The RfP is scheduled to be made public later today. A draft solicitation has been on the streets since late September.

Boeing is expected to enter its KC-767 aircraft. Northrop Grumman and partner EADS won the last KC-X race, but Boeing successfully protested. The trans-Atlantic partners have expressed major reservations about the Pentagon's approach for this round, going so far as threatening to skip the race.

In the Hill briefing, Lynn said "we favor a competition," adding the final RfP is "structured to be fair to both sides, and, above all, to the taxpayer and war fighter." The Pentagon expects a contract award in the "fourth quarter, FY10," according to the briefing.

The final RfP will keep in place an evaluation framework under which all proposals will be judged against 372 "mandatory requirements" set by U.S. Air Mobility Command. As the Air Force determines if the proposed planes can do those things "on day one," the briefing states, it also will run other analyses on issues such as the planes' fuel burn rates and all needed military construction to accommodate the planes.

At the end of this phase, the Air Force will calculate a "total estimated price" for each entry. If the costs are within 1 percent of one another, both aircraft would remain in the running and enter a second stage during which the planes would be judged on whether they can perform 93 nonmandatory requirements.

Some critics, including Northrop Grumman-EADS and defense analysts, have said the evaluation structure essentially sets up a cost shootout because, as the DoD briefing acknowledges, it is anticipated that both the KC-767 and the A330 can meet the 372 mandatory specs.

But in a section of the briefing attributed to Lynn, the deputy secretary told lawmakers "a bidder could actually have a higher proposed price and still win.

"This is a best-value competition," Lynn said, according to the briefing. "The factors include war-fighting effectiveness, cost of ownership over the 40-year life of these aircraft, and possibly other features than those mandatory requirements needed by the war fighter on Day 1."

The Air Force and Pentagon brass also elected to keep in place another aspect of the September draft solicitation that called for a fixed-price development stage of the KC-X program. As the officials said in today's briefing, this is because the department feels little "high-risk" development is needed on either tanker.

Both industry teams - and industry advocate groups - have expressed concern about this aspect of the Pentagon's approach.

Change of Plans

DoD did, however, change its plans for the fixed-price contracts it will seek for various lots of the KC-X buy. Lots 1 and 2, for instance, will remain as planned under a firm fixed-price contract, "based on the experience of the competitors," according to the briefing. For Lots 3 through 13, however, the Pentagon will insert certain tools designed to protect "both taxpayers and industry" from "economic fluctuations" that may occur in coming years.

As for the slate of KC-X requirements, Donley is quoted in the briefing as saying, "over 230 changes have been incorporated into the [final] RfP; ... the vast majority were as a result of industry's concerns."

One spec was scrapped: the need for a microwave landing system.

Other changes, according to the briefing:

■ "Large Aircraft Infrared Countermeasures: changed to government-furnished equipment."

■ A section on an alert quick-start requirement was altered to specify temperature range and power-cart usage.

■ A requirement for "non-ozone depleting fire suppression" was tweaked to clarify "emerging commercial standards."

A Northrop Grumman spokesman declined to comment on whether the changes will be enough to compel the Northrop-EADS team to compete.

Following the session with the Pentagon officials, Rep. Todd Tiahrt, R-Kan., told reporters he thinks "the Alabama delegation won't be happy."

If they capture the contract, Northrop and EADS would assemble the flying gas stations in Mobile, Ala.

Tiahrt, a member of the House Appropriations defense subcommittee, described the final RfP - with its 372 mandatory specs - as "building a more finite competition."

Boeing does KC-767 work in several states, including Kansas.

The Air Force and Pentagon will not "give extra credit for additional capabilities that are not needed" for a medium-sized tanker, he said, referring to the ability to conduct missions like aerial medical evacuation and cargo hauling.

In the briefing, Lynn is quoted as telling lawmaker extra credit would be given to proposed airframes in certain instances, such as fuel offload.

"Now, some have suggested that we are aiming low or have set requirements that are less than that of today's KC-135s. Let me point out that only one of the nine key performance parameters regarding the fuel offload, is the same as today's KC-135s," Lynn said, according to the briefing.

"In the case of fuel offload, the mandatory requirement meets the capability of the KC-135. Exceeding the mandatory fuel offload requirement is given credit in the non-mandatory evaluation," he said.

Further, the final RfP keeps in place the Pentagon's plans to exclude a preliminary ruling by the World Trade Organization that EADS gets subsidies from European nations that gives it an unfair leg up in the world market. DoD contends that initial ruling is only the first stage in an internal WTO process that will take years to resolve.

"This is a time to make a stand on that," Tiahrt said. "I'm not happy ... because of DoD's failure to account for the WTO decision…and the numerous waived requirements for Airbus."

- John Reed contributed to this report.

[buglerbilly]

USAF Sets KC-X First Flight, IOC Dates

By JOHN REED

Published: 25 Feb 2010 16:35

The U.S. Air Force expects a first flight for its KC-X tanker by 2012 and hopes to have the plane flying refueling missions by 2017, service officials said Feb. 25.



The U.S. Air Force expects the KC-X tanker, which would replace the KC-135, shown above, to make its first flight by 2012. (STAFF SGT. ROBERT BARNEY / U.S. AIR FORCE)

If all goes well with the latest restart of the $35 billion competition, the service expects to buy four test airplanes that will be used for test flights and later be modified into production aircraft, according to a service announcement.

The Pentagon plans to have the first lot of seven new tankers in production by fiscal 2013, with the first aircraft delivered to the Air Force in fiscal 2015, according to the announcement.

The current request for proposals, released Feb. 24, also requires that 18 aircraft be delivered by 2017. Once this happens, the service will look at whether the aircraft have reached their initial operational capability, clearing them to perform basic aerial refueling missions, according to the announcement.

[buglerbilly]

Who needs Northrop Grumman anyway?

By Stephen Trimble on February 25, 2010 8:54 PM

While we're all waiting for Northrop Grumman to decide whether it wants to play, let's consider what could happen if they don't submit a bid for the $35 billion tanker contract.

In the absence of a Northrop-led proposal, what would stop EADS North America from submitting its own bid for the KC-X deal?

I can think of reasons why they would. If price is such a factor in the competition, cutting out the US flag bearer and bringing systems integration in-house might save some money. EADS NA has demonstrated it can win an aircraft contract from the US military. The 100th UH-72 Lakota for the US Army rolls off the assembly line in Mississippi next week. The company believes its solid performance on LUH allows it to compete on fair terms with American-owned companies for other Pentagon contracts.

On the other hand, there's no question EADS' chances of victory are smaller without Northrop's help. Northrop has powerful friends on Capitol Hill and a long relationship with the customer. Moreover, as long as fuel offload requirements for the next tanker are modeled on the KC-135R, the KC-45 is going to be disadvantaged against a smaller aircraft like the Boeing 767. And let's be honest: The UH-72, despite its success, is not a widebody tanker; it's a civilian airspace-only light utility helicopter.

EADS NA is not ready yet to even acknowledge whether their teaming agreement with Northrop would preclude a standalone bid, as I asked them earlier today. EADS' spokesman replied: "EADS North America is committed, under the team leadership of Northrop Grumman, to provide the most capable tanker to the US warfighter."

But I think it's still a fair question. Why not?

[buglerbilly]

From James Hasik blog

26 February 2010

Why Northrop Grumman and EADS might just yet bid on the KC-X.

Might Northrop still bid on the tanker project? It may be that “all the evidence suggests otherwise,” as one journalist who has been covering the competition for years put it to me yesterday. The requirements in the RFP strongly favor a 767 over an A330, in that the evaluation process will penalize a larger aircraft for higher operating costs, but not reward it for higher fuel and cargo capacity. That may be the USAF’s business, but it is what it is. Northrop Grumman has therefore repeatedly declared its disinterest; according to Amy Butler of Aviation Week, the company’s “officials have apparently informed lawmakers that they predict a 96 to 98 percent chance of not bidding.”

But why say 96 to 98 percent? Why not just say, this is lame, we’re done, we’re going home? Is Northrop—or are Northrop and EADS—leaving open the possibility of a last-minute bid? It’s a reasonable idea. Frankly, if I were advising either company—and I’m not—I would suggest thinking about it, for four reasons:

Not bidding could really irritate EADS. As I am not privy to the marketing agreement between the two companies, I do not know if EADS would be precluded from bidding on its own if Northrop decided to pass. To win with this RFP, whoever is coming with an A330 would need to bid aggressively. EADS might see value in bidding at cost—the whole point of the project, then, would be to get the USAF to pay for Airbus to facilitize production in the dollar zone. With sales denominated in dollars, but costs substantially in euros, Airbus is subject to considerably more currency exchange rate risk than Boeing. Northrop lacks this strategic interest, and probably wouldn’t see much value to another big business making no money. (The company has enough of that problem on the Gulf Coast.) However, if EADS is for some reason precluded from bidding on its own, then Northrop’s refusal to proceed would pretty much sunder the already tense relationship between those companies. The KC-Y competition would certainly be an EADS-only affair.

Bidding would build goodwill with the customer and the community. That KC-Y and KC-Z competitions will come along, and EADS has known for some time that it has a much better opportunity at winning the replacement for the KC-10s. Thus, there may be value in playing the game now just to build some goodwill for the next rounds. EADS and Northrop might warm some hearts in Alabama if they brought in a bid at the last moment, just because they "owed it to the communities that had supported them" (or something to that effect.) EADS has done this once before. The company put in a bid back in 2003 even as several senior USAF officials were trading electronic hate mail about French airplanes. The point was to show the rational people within the customer organization and the congress that EADS was a team player, a good corporate citizen, and a responsive potential supplier. This time around, the USAF would at least appreciate that they were willing to be a stalking horse.

The costs could be limited. Contrary to what a few pundits have claimed, bidding need not be a hugely cost endeavor. The bidders only have 75 days to respond, and they know what they're bidding, so assembling a package shouldn't be outrageously expensive. They've had these program offices in place for years, and it’s not as though they need to disperse the staffs next week. They might as well do something before they all wrap up. If it’s really just supposed to prod Boeing into bidding aggressively, then the bid can be merely perfunctory. Indeed, the less aggressive the bid, the less care needs to go into writing it. A bigger margin can hide ex ante errors.

Boeing could get greedy. Then again, if they were willing to submit a sharp bid, or even one at cost, there's always the possibility that Boeing will assume that there’s no Airbus on offer, and bid with a fat margin. That could be made more likely by these repeated disavowals of any interest in the process. In that case, even the cost-disadvantaged A330 might come through. It did last time. Moreover, trying to explain to the shareholders why Northrop took its marbles and went home after all these years of competing could be difficult.

[Milne Bay]

From James Hasik blog

26 February 2010

Why Northrop Grumman and EADS might just yet bid on the KC-X.

Might Northrop still bid on the tanker project? It may be that “all the evidence suggests otherwise,” as one journalist who has been covering the competition for years put it to me yesterday. The requirements in the RFP strongly favor a 767 over an A330, in that the evaluation process will penalize a larger aircraft for higher operating costs, but not reward it for higher fuel and cargo capacity. That may be the USAF’s business, but it is what it is. Northrop Grumman has therefore repeatedly declared its disinterest; according to Amy Butler of Aviation Week, the company’s “officials have apparently informed lawmakers that they predict a 96 to 98 percent chance of not bidding.”

But why say 96 to 98 percent? Why not just say, this is lame, we’re done, we’re going home? Is Northrop—or are Northrop and EADS—leaving open the possibility of a last-minute bid? It’s a reasonable idea. Frankly, if I were advising either company—and I’m not—I would suggest thinking about it, for four reasons:

Not bidding could really irritate EADS. As I am not privy to the marketing agreement between the two companies, I do not know if EADS would be precluded from bidding on its own if Northrop decided to pass. To win with this RFP, whoever is coming with an A330 would need to bid aggressively. EADS might see value in bidding at cost—the whole point of the project, then, would be to get the USAF to pay for Airbus to facilitize production in the dollar zone. With sales denominated in dollars, but costs substantially in euros, Airbus is subject to considerably more currency exchange rate risk than Boeing. Northrop lacks this strategic interest, and probably wouldn’t see much value to another big business making no money. (The company has enough of that problem on the Gulf Coast.) However, if EADS is for some reason precluded from bidding on its own, then Northrop’s refusal to proceed would pretty much sunder the already tense relationship between those companies. The KC-Y competition would certainly be an EADS-only affair.

Bidding would build goodwill with the customer and the community. That KC-Y and KC-Z competitions will come along, and EADS has known for some time that it has a much better opportunity at winning the replacement for the KC-10s. Thus, there may be value in playing the game now just to build some goodwill for the next rounds. EADS and Northrop might warm some hearts in Alabama if they brought in a bid at the last moment, just because they "owed it to the communities that had supported them" (or something to that effect.) EADS has done this once before. The company put in a bid back in 2003 even as several senior USAF officials were trading electronic hate mail about French airplanes. The point was to show the rational people within the customer organization and the congress that EADS was a team player, a good corporate citizen, and a responsive potential supplier. This time around, the USAF would at least appreciate that they were willing to be a stalking horse.

The costs could be limited. Contrary to what a few pundits have claimed, bidding need not be a hugely cost endeavor. The bidders only have 75 days to respond, and they know what they're bidding, so assembling a package shouldn't be outrageously expensive. They've had these program offices in place for years, and it’s not as though they need to disperse the staffs next week. They might as well do something before they all wrap up. If it’s really just supposed to prod Boeing into bidding aggressively, then the bid can be merely perfunctory. Indeed, the less aggressive the bid, the less care needs to go into writing it. A bigger margin can hide ex ante errors.

Boeing could get greedy. Then again, if they were willing to submit a sharp bid, or even one at cost, there's always the possibility that Boeing will assume that there’s no Airbus on offer, and bid with a fat margin. That could be made more likely by these repeated disavowals of any interest in the process. In that case, even the cost-disadvantaged A330 might come through. It did last time. Moreover, trying to explain to the shareholders why Northrop took its marbles and went home after all these years of competing could be difficult.

Precisely.
Companies must think and plan strategically. This has always made sense.
There is everything to gain by bidding and everything to lose by not bidding.
They would be idiots not to bid.
MB

[buglerbilly]

Ares

A Defense Technology Blog

Will Northrop Take A Pass On KC-X?

Posted by Joe Anselmo at 2/26/2010 11:41 AM CST

An aerospace equities analyst says recent changes to Northrop Grumman's executive compensation metrics are another sign that the defense giant will not bid on the U.S. Air Force's KC-X tanker contract if it believes it cannot get a good deal.

Oppenheimer & Co.'s Myles Walton notes that Northrop Grumman has adjusted its executive compensation metrics to emphasize profitability over sales growth. The new formula is a "striking" difference from compensation incentives set by General Dynamics, Lockheed Martin and Raytheon and "would seem to acknowledge what few will say publicly, which is that organic market growth in defense is limited, and Northrop Grumman will instead focus on what it believes it can control."

Northrop's new incentives reward divesting underperforming businesses, avoiding large acquisitions, focusing on efficiency, returning capital to shareholders -- and turning down "bad contracts," Walton says, asking if that holds "implications for tanker."

The Air Force issued a final request for proposals for the tanker contract on Feb. 24, But Northrop, which is teamed with EADS, has said it will not bid if the competition is tilted in Boeing's favor..

Defense analyst Loren Thompson, in a blog posted today, said Northrop Grumman has four options on tanker. It could bite the bullet and bid; lodge a protest with the Government Accountability Office that the solicitation violates federal acquisition standards; challenge a sole-source award to Boeing; or convince Congress to intervene.

"After four years and $200 million in expenses, Northrop Grumman may have reached a dead end in its bid," Thompson writes.

[buglerbilly]

Officials Push Tanker RFP Fairness

(Source: Forecast International; issued February 25, 2010)

WASHINGTON --- The Air Force released a Request for Proposals (RFP) for the KC-X tanker replacement program in what it hopes will be the final time. Deputy Defense Secretary William J. Lynn, Secretary of the Air Force Michael B. Donley, and Under Secretary of Defense (AT&L) came to the Pentagon press room to emphasize that the top-priority competition would be "fair, open, and transparent" and that it would be a Best Value competition where price is important, but not the only criterion. Deputy Secretary Lynn also told reporters the process could become the "flagship for acquisition reform."

The deputy secretary explained that since the September release of the draft RFP, competitors and Congress had made 350 comments that resulted in 230 changes to the RFP. While most changes were technical in nature, two major moves were changing the LAIRCM protection system to GFE (government-furnished equipment) and dropping the Microwave Landing System (MLS) requirement because technology has passed the system by. There was no change in the warfighting requirements for the new tanker. "It must be ready to fight from day one," they all agreed.

One issue about the bidding was addressed with crossed fingers. While the program is structured for more than one bidder, statements from Northrop Grumman raised questions about whether or not the company would bid at all. DepSec Lynn said he hoped that Northrop would bid.

Others in Washington also pressed for a two-bidder program. House Armed Services Committee (HASC) Chair Ike Skelton (D-Mo.) and Ranking Member Howard P. "Buck" McKeon (R-Calif.) expressed confidence in the Air Force efforts to make the RFP fair and equitable and hoped there would be multiple bidders on the program. Members of the Alabama congressional delegation (Northrop Grumman plans to build the aircraft in that state) announced support for that bid as well.

Northrop Grumman released a cautious statement saying, "Northrop Grumman acknowledges that today it has received the final Request for Proposals for the U.S. Air Force KC-X Tanker Modernization Program. Northrop Grumman will analyze the RFP and defer further public comments until its review of the document has been completed."

Now that the RFP has been officially released, the clock is ticking. The schedule calls for proposal submissions in 75 days. The government's evaluation is set to take 120 days, followed by 30 days of contract award preparations. This puts contract award into the fourth quarter of FY10, with a September award probable, the group said.

When asked about the possibility of another protest, Under Secretary Ashton Carter said he certainly hoped there would be none. The Pentagon has gone to great pains to ensure the process is fair and transparent, he remarked. "The winner will know why they won and the loser will know why they did not," he pointed out.

The acquisition chief said that the climate of protesting everything was becoming too routine, and hoped that in this case, provided there was no serious DoD mistake in the process, bidders would exercise restraint.

-ends-

[McDethWivFries]

Wasn't there another country (the UK?) taking an EADS tanker based on the A320? If so, how would that compare to the 767 and if it compares well and the USAF decides to go how its going, whats to stop EADS/NG from bidding that one instead of the A330 based variant? Surely that would reduce their costs down to a point to make it competative cost wise?

[buglerbilly]

THIS is what you mean, A330's NOT A320's...............


FSTA - Future Strategic Tanker Aircraft

The MoD has selected AirTanker, following an open competition, to provide the replacement air-to-air refuelling and air transport capability.

DetailsThe MoD has selected AirTanker, following an open competition, to provide the replacement air-to-air refuelling and air transport capability through the Future Strategic Tanker Aircraft (FSTA) programme. A Private Finance Initiative (PFI) solution is being adopted, in which the private sector will provide not only replacement aircraft, but also a complete and secure long-term service. AirTanker provide a comprehensive service for the RAF to ensure the full operational availability of the fleet over a 27 year period.

AirTanker will provide the Airbus A330 aircraft as 2-point tankers, equipped with 2 FRL Mk32B 900E pods. A number of the aircraft in the fleet will also be capable of being fitted as 3-point tankers. Very few internal changes are required to the A330-200 to modify it for the air-to-air refuelling role. In particular no additional fuel tanks are required. As the A330 shares the same wing as the four-engined A340, there is a pre-strengthened location available for mounting the wing Mk32B pods.

The full passenger and cargo capability can be used while the A330-200 is configured for AAR operations. The cabin remains fully configured and the cargo compartments are unobstructed. On a typical deployment across the Atlantic, a single A330 would be able to refuel 4 Tornados and still carry 11,000lb (5000kg) of freight/passengers.

One novel aspect of the contract is the facility to lease the aircraft for civil operations. The considerable commercial demand for the A330 makes it attractive to third-parties who would operate those aircraft from the fleet thast are not immediately required for RAF use. This would deliver a major cost saving to the MoD and taxpayer and ensures that the considerable capability advantages of the A330 are affordable.

The A330 will replace the RAF's existing VC10 and Tristar fleets at RAF Brize Norton.


Selection and contract negotiations

The UK Ministry of Defence announced on 26 January 2004 that Air Tanker had been selected to enter into final negotiations to provide the RAF's FSTA.

Following aircraft selection the UK MoD began exclusive negotiations with the Airtanker consortium. However, beginning in April 2004, there were rumours about the fragile state of the contract negotiations. With continuing doubts over the FSTA programme, Marshall Aerospace, responsible for the conversion of the RAF's original Tristars, have offered to buy and convert some of the large number of surplus commercial Tristars.

On 28 February 2005 the MoD named Airtanker as its preferred bidder for the £13bn contract. It was reported that the tanker shortage that could result from any further serious delay has led some RAF personnel to joke that FSTA stands for "Fucking Short of Tankers Again" .

AirTanker awarded contract

The MoD announced on 6 June 2007 that AirTanker had been given the approval it needed to continue with the project, allowing the company to seek the £2 billion private financing required to begin funding the aircraft.

On 27 March 2008, the UK signed a contract with AirTanker for £13 billion over the course of the contract, and will involve 14 converted A330 aircraft being delivered from 2011 onward.[5] This is two years later than in previous discussions.

The first airframe was delivered for tanker conversion on 10 July 2009.

[Exsandgroper]

Wasn't there another country (the UK?) taking an EADS tanker based on the A320? If so, how would that compare to the 767 and if it compares well and the USAF decides to go how its going, whats to stop EADS/NG from bidding that one instead of the A330 based variant? Surely that would reduce their costs down to a point to make it competative cost wise?

Or this one,

http://en.wikipedia.org/wiki/Airbus_A310_MRTT

This one has also been used as a test bed for the probe for the A330

Cheers

[McDethWivFries]

Or this one,

http://en.wikipedia.org/wiki/Airbus_A310_MRTT

This one has also been used as a test bed for the probe for the A330

Cheers

That thats the one . . totally different ac to the 320/330 but it DOES start with an A3 and end in 0 so wasn't far off (o:

[buglerbilly]

UPDATE 1-Northrop says it's nearing decision on tanker bid

* European source says EADS backing a new bid (Adds comments from Air Force secretary, European official, byline)

By Andrea Shalal-Esa and Tim Hepher

WASHINGTON/PARIS, March 2 (Reuters) - Northrop Grumman Corp (NOC.N) said on Tuesday it was still reviewing the Air Force's final terms for a multibillion-dollar aerial tanker competition but was "getting closer to a decision" on whether to submit a bid with its European partner EADS (EAD.PA).

"We continue to conduct a thorough review of the final RFP (request for proposals) and I will acknowledge that we are getting closer to a decision. However, we are deferring further comment until our analysis is completed," Northrop spokesman Randy Belote told Reuters.

He declined to comment on exactly when the company was likely to decide whether to submit a renewed bid.

Northrop and EADS won the last competition in February 2008 with an Airbus A330-based tanker plane, but the deal, valued at around $35 billion, was later canceled after government auditors upheld a Boeing Co (BA.N) protest.

Northrop told the Pentagon in December it would not submit a bid in this follow-on competition unless there were significant changes to the Air Force's draft rules, which it said clearly favored Boeing's smaller 767 airplane.

A European source said EADS, anxious to add to its defense portfolio and gain a bigger foothold in the United States, was backing a new bid despite its concerns over the possibility of being locked once again into a rigidly priced contract.

"It looks like (they) are going for it. EADS can't afford not to," said the source, who was not authorized to speak publicly.

EADS declined to comment.

Some of Northrop's backers in Congress last week said they thought the final terms released by the Air Force contained only minor changes and still appeared to favor Boeing, but said they were encouraging Northrop to submit a renewed bid given the large number of jobs the program would generate.

Pentagon officials insisted the revised rules would allow both teams to bid and win the winner-takes-all contest.

Air Force Secretary Michael Donley told defense reporters on Tuesday that he and other Pentagon officials met on Wednesday with Northrop Chief Executive Wes Bush and Paul Meyer, the Northrop official running the tanker bid, but had not received any communication with the company since then.

"Northrop indicated that they were appreciative of the changes that we made on the business side of the RFP and that they would take a careful look at the content," Donley said.

"We hope to have a good competition from this RFP and ... we're awaiting bidders," he said.

EADS had planned to begin producing not just the A330-based tankers, but a freighter version of the plane in the United States, after winning the tanker contract.

The European company wants to reduce its reliance on cyclical commercial jetliner revenues at its main subsidiary, Airbus, which generated 63 percent of both revenue and operating profit under the group's previous structure in 2008.

EADS is in the midst of finalizing a 3.5 billion euro bailout from seven governments to help it repair massive cost overruns on the delayed Airbus A400M airlifter.

But it still faces billions of euros of losses due to a fixed-price contract on the plane, which is being built to reduce European reliance on Lockheed Martin (LMT.N) and Boeing transport planes, and turn EADS into a more rounded civil and defense contractor.

EADS is also anxious to maintain momentum in the market for tankers outside the United States. EADS won the last five competitions against Boeing but faces a potentially tougher marketing pitch if the U.S. tender sets a different standard. (Reporting by Andrea Shalal-Esa and Tim Hepher in Paris; Editing by Steve Orlofsky)

[buglerbilly]

Boeing Selects 767 for USAF KC-X Tanker Bid

Mar 4, 2010



By Amy Butler abutler@aviationweek.com
Washington


Boeing’s so-called NewGen Tanker, a 767-based design for the U.S. Air Force KC-X competition, will feature a new refueling boom and a flight deck based on the 787 commercial transport.

Company officials announced this afternoon that the aircraft will be based on a 767, but they declined to say which 767 variant is the departure design. An artist’s concept of the design appears to point to a 767-200.

In a departure from its last KC-X design proposal, Boeing is using the new flight deck, which they say will provide information displays that are 75% larger than the Airbus A330, on which a potential competitor’s design will be based.

A Northrop Grumman/EADS team won the last KC-X competition in February 2008 with the A330-based tanker, which drew from the Multi-role Tanker Transport being built for Australia. But, government auditors found missteps in the Air Force’s source selection and the contract has been terminated in favor of a new competition.

Also a departure in Boeing’s new design is “a new generation fly-by-wire boom with an expanded refueling envelope and increased fuel offload rate,” according to Boeing’s announcement. The refueling boom design is more reminiscent of a KC-10 boom rather than that of the KC-135. It is likely this switch was made to achieve the 1,200 gallon-per-minute offload rate demanded by the final KC-X request for proposals (RFP), which was released by the Air Force on Feb. 24. Boeing’s boom offered in the last competition used a ruddervator structure more like the KC-135 boom, according to pictures, although its exact capabilities were shrouded in mystery.

The wings on this 767-based tanker appear to be significantly longer than a baseline 767-200 commercial model, perhaps a design choice made to address wing flutter issues experienced on the Italian 767 tanker. However, Boeing officials declined to comment on whether the wings, doors, floors and flaps were being pulled from other commercial models.

In the 2007-2008 competition, Boeing’s offering was derided by some as a “Frankentanker” for pulling pieces of its commercial aircraft models into a single new design. This approach was considered by USAF officials to be higher risk at the time.

However, in the forthcoming KC-X competition, all 327 requirements are pass/fail, so this approach may not carry the same stigma as it did before.

Boeing Defense, Space and Security President Dennis Muilenburg says the design will meet all of the 372 pass/fail requirements.

Northrop Grumman/EADS officials have not said yet whether they will bid or back out of the competition as they have threatened. They feel the latest KC-X RFP favors a smaller tanker.

Photo: Boeing

[buglerbilly]

More on this Boeing selection............

Ares

A Defense Technology Blog

New Pic and Update: Boeing Unveils 767 Tanker Design

Posted by Amy Butler at 3/4/2010 12:01 PM CST

Boeing has "unveiled" its so-called "NewGen Tanker," a 767-based design for the U.S. Air Force KC-X competition.

Company officials say the design will use a 767, but they declined to say which 767 is the departure design. This photo appears to point to a 200.


Boeing concept

In a departure from the last KC-X design proposal, Boeing officials are using the 787 Dreamliner flight deck, which they say will provide information displays that are 75% larger than the A330, which is the potential competitor design.

Also a departure is this boom design that is pictured. The design is more reminiscent of a KC-10 boom rather than the KC-135. It is likely this switch was made to achieve the 1200 gallon per minute offload rate demanded by the KC-X. The boom offered in the last competition, which Boeing lost in February 2008 to a Northrop Grumman/ EADS team, used a ruddervator structure more like the KC-135 boom.

Boeing has been dealing with the flutter issue on its international tanker design, and the wings on this 767-based tanker appear to be significantly longer than a baseline 767-200 commercial model.

Boeing officials declined to comment on whether the wings, the doors and floors and flaps were being pulled from other commercial models. They declined interview requests as well, citing the release as a web rollout.

In the 2007/2008 competition, the company was dogged as crafting a "Frankentanker" for pulling pieces of its commercial model aircraft into a single new design. This was dubbed a high risk then.

However, in the forthcoming KC-X competition, all 327 requirements are pass/fail, so this approach may not carry the same risk as it did before given the new rules.

Boeing Defense, Space and Security President Dennis Muilenburg says the design will meet all of the 372 pass/fail requirements.

Northrop Grumman/EADS officials haven't said yet whether they will bid or back out of the competition as they have threatened. They feel the RFP released last week favors a smaller tanker.

[buglerbilly]

And a final bit more.............



Boeing unveils a new B767 Derivative 'NewGen Tanker' for U.S. Air Force Competition

Boeing has unveiled today the 'NewGen Tanker', the aerial refueling aircraft being proposed for the U.S. Air Force KC-X tanker competition. According to Dennis Muilenburg, president and CEO of Boeing Defense, Space & Security, the Boeing NewGen Tanker will satisfy all mandatory Air Force requirements and offer an American-made tanker that will be capable, survivable, and combat-ready at the lowest cost to the taxpayer.


The NewGen Tanker will use a fly-by-wire controlled refuelling boom with higher capacity. The distinctive blended winglets are also a new feature, expected to save over 4% in fuel consumption. (Boeing photo illustration)

Boeing considers the NewGen Tanker to be the optimal airframe size to deliver the most capability for the lowest cost to own and operate - a wide body, multi-mission aircraft based on the proven Boeing 767 commercial aircraft, updated with the latest and most advanced technology and capable of fulfilling the Air Force's needs for transport of fuel, cargo, passengers and patients.

The multi-mission aircraft is named NewGen because it includes several state-of-the-art systems to meet new requirements, including a digital flight deck featuring electronic displays derived from the new Boeing 787 Dreamliner, featuring display area 75% larger than the commercial A330, considered to be the competing platform on the KC-X bid. The new Boeing aircraft will also be fitted with new-generation fly-by-wire boom with an extended refueling envelope and increased fuel offload rate, expected to meet the Air Forces' requirement for increased efficiency and higher refueling rate, compared to the KC-135, providing simplified refueling operations, reduced workload for the aircrew and improved safety and reliability. While being computer controlled through the fliy-by-wire system, Boeing stresses that "the new tanker will be controlled by the aircrew, which has unrestricted access to the full flight envelope for threat avoidance at any time, rather than allowing computer software to limit combat maneuverability."

Boeing argues its new NewGen Tanker will have an advantage over the larger and heavier Airbus airplane, as it will be cost-effective to own and operate. Since the lighter B767 platform burns 24 percent less fuel than the Airbus, the NewGen Tanker is expected to save more than $10 billion in fuel costs over its 40-year service life. The Air Force released its final KC-X Request for Proposal on Feb. 24. Boeing will deliver its proposal by May 10, within the 75-day period set forth in the terms of the solicitation. The Air Force is expected to announce its decision later this year.

The new blended winglets introduced in this model will improve the aircraft performance by reducing drag. These winglets were first introduced on the Boeing Business Jet (BBJ) and Next-Generation 737-800 in 2001 and were certified on the B767-300ER in 2009. Flight test data demonstrate that blended winglets lower block fuel and carbon dioxide (CO2) emissions by 4.4 percent on the 767. Blended winglets also improve takeoff performance, allowing deeper takeoff thrust derates that result in lower emissions and lower community noise. An airline that recently began flying 767-300ERs with blended winglets anticipates that each airplane equipped with the winglets will save up to 500,000 U.S. gallons of fuel annually, depending on miles flown. The airline plans to install winglets on its entire 58-airplane fleet of 767-300ERs, which could result in a total savings of up to 29 million U.S. gallons of fuel per year and a reduction of up to 277,000 tons of CO2 emissions annually.


Blended winglets such as those added to the NewGen Tanker are expected to save fuel, reduce carbon dioxide emisions and improve takeoff performance. (Boeing photo illustration)


The 767 platform widebody tanker carries full height and weight 463L military cargo pallets on the main deck. It is fully FAA certified as a convertible freighter for passenger or cargo carriage. Photo: Boeing

[Trackmaster]

As the Boeing aircraft only exists in a hard-drive somewhere in Seattle, I'll be fascinated to see the time-lines for development and delivery.
I would think that NG/EADS would have a clear advantage on that front.
Boeing seems to be setting itself up for huge integration challenges with this proposal.
What price our first two tankers coming home via the USA, with a stop-over in Alabama?

[Unicorn]

Guys, the info I have from contacts in the US tanker community is that the aircraft selected will be a Boeing, no matter how many times that Congress and the Senate force a rerun, basically they will ask the same question over and over until they get the answer that they want.

Unicorn

[Milne Bay]

Guys, the info I have from contacts in the US tanker community is that the aircraft selected will be a Boeing, no matter how many times that Congress and the Senate force a rerun, basically they will ask the same question over and over until they get the answer that they want.

Unicorn

....................truth, justice and the American way ......................

[buglerbilly]

Boeing Selects Pratt & Whitney to Power Boeing's Proposed NewGen Tanker to be Offered to U.S. Air Force

(Source: Pratt & Whitney; issued March 5, 2010)

EAST HARTFORD, Conn. ---- In an announcement made today, Boeing said it is offering the Pratt & Whitney-powered NewGen Tanker as its platform for the U.S. Air Force's KC-X recapitalization program. Boeing's proposal calls for the NewGen Tanker to be powered by Pratt & Whitney's PW4062 engine. Pratt & Whitney is a United Technologies Corp. company.

"Pratt & Whitney is honored to partner with Boeing on the NewGen platform to be offered as America's next generation of tankers for the U.S. Air Force's KC-X program," said Bill Begert, Pratt & Whitney Vice President of Military Business Development and Aftermarket Services. "The PW4000 engine has an exceptional track record of performance and reliability with numerous commercial customers operating the engine globally. We are confident it will meet Boeing and the U.S. Air Force's performance requirements and expectations."

Pratt & Whitney has delivered more than 2,500 PW4000-94" commercial engines that collectively have logged more than 100 million flight hours on commercial aircraft around the world. The PW4062 is the highest thrust model in Pratt & Whitney's PW4000-94" commercial engine family and is offered for both commercial freighter and military tanker applications. Two PW4062 engines, each delivering 62,000 pounds of thrust, will power the Boeing Company's NewGen Tanker.

The PW4000 family of engines includes models with thrust ratings ranging from 52,000 pounds to 98,000 pounds. These engines have an outstanding safety record, high reliability, excellent performance and low maintenance costs. The PW4000 family meets all required emissions and noise regulations, and offers superior fuel economy and maintainability. The PW4000-94" engine operates commercially on Boeing 747, 767 and MD-11 aircraft and the Airbus A300/310 series.

Pratt & Whitney is a world leader in the design, manufacture and service of aircraft engines, space propulsion systems and industrial gas turbines. United Technologies, based in Hartford, Conn., is a diversified company providing high technology products and services to the global aerospace and building industries. (ends)

Boeing to Go with KC-767 in Tanker Contest, as Expected

(Source: Forecast International; issued March 5, 2010)

NEWTOWN, Conn. --- Boeing announced plans to offer the KC-767 in the competition to supply the U.S. Air Force with a new tanker under the long-delayed KC-X tanker program. The selection of the KC-767 for the job over a potential entry based on the larger Boeing 777 was expected after the Air Force released its final KC-X Request for Proposals on February 24, because the final RFP favors a smaller aircraft than the notional KC-777.

Boeing's KC-767 offering is based on the Boeing 767 widebody airliner. The new tanker variant will feature a new digital flight deck taken directly from Boeing's new 787 Dreamliner and a new fly-by-wire boom system. Boeing also claims that its tanker program "will support substantially more jobs in the United States than an Airbus A330 tanker that is designed and largely manufactured in Europe."

Boeing had initially selected Pratt & Whitney PW4062 engines for its KC-X entrant, but has reportedly considered General Electric's GEnx engine developed for the 787 and 747-8.

The company has built KC-767 tankers for Italy and Japan, but these aircraft do not feature the 787's cockpit and use mission systems that are substantially different from those to be used in the KC-X aircraft, due to the U.S. Air Force's different requirements.

-ends-

[Deks]

What are the chances that NG/EADS could offer a smaller aircraft like the A310 MRTT ? I mean if it's all pass/fail, it might even work out better for them; better yet, could screw round boeing for another round.

Sad as it is, I agree that Boeing will eventually take the contract.

[tiddles]

Got this off another Forum but it seems that the long winded process has been quite a waste of time.
Tiddles
From the Associated Press...

"Northrop Grumman Corp. announced Monday that it will not compete against Boeing Co. for a $35 billion contract to build refueling tankers for the Air Force because Northrop doesn't think it can win.

Northrop Chief Executive Officer and President Wes Bush said in a statement that the Pentagon's guidelines for the program "clearly favors Boeing's smaller refueling tanker" but that the company would not file a formal protest.

"We have a fiduciary responsibility to our shareholders to prudently invest our corporate resources, as do our more than 200 tanker team suppliers across the United States," Bush said. "Investing further resources to submit a bid would not be acting responsibly."

The political fallout was swift. Alabama Gov. Bob Riley, where Northrop would have assembled the planes and created thousands of new jobs, called the program a "charade" and said the Pentagon made it "impossible" for Northrop to compete.

Industry insiders say that the decision by Northrop wasn't surprising.

"When all was said and done, Northrop saw a lot of risk and not a lot of profit," whereas EADS was focused primarily on gaining entry into the U.S. market, said Loren Thompson, head of the Lexington Institute. "At the end of the day, the interest of the two teams diverged."

Boeing's supporters shrugged off concerns that Northrop's decision would mean higher program costs because Boeing would still have to meet requirements laid out by the Pentagon. Ultimately, they said it was good news that some of the work would not go overseas to EADS.

Boeing announced last week that it would offer a military version of its 767 passenger jet for a fleet of 179 new planes. The contract is expected to be the first of several to replace many Air Force planes that date back to the 1950s. Boeing said it will submit its formal bid by May 10.

A final contract is to be awarded in September."

[buglerbilly]

Northrop Grumman Officially Out of KC-X

Mar 8, 2010

By Amy Butler abutler@aviationweek.com
Washington

Northrop Grumman’s announcement that the company will not support a joint bid with EADS North America for the Air Force’s KC-X aerial refueler competition contained a parting shot for the Pentagon and Boeing: Don’t overpay with a sole-source contract.

In his statement, Northrop Grumman CEO Wes Bush says that when his company’s bid won in 2008, the per-unit price was $184 million for the first 68 tankers, including the $1.5 billion development cost.

Senior Pentagon officials, including Deputy Defense Secretary Bill Lynn, Air Force Secretary Michael Donley and Pentagon acquisition chief Ashton Carter said during a Feb. 24 briefing to release the KC-X request for proposals (RFP) that the issue of a sole-source was merely hypothetical. The Office of the Secretary of Defense (OSD) is still not providing detail on how it will proceed with a sole-source deal for Boeing. Air Force officials deferred all questions to OSD.

However, one Defense Dept. official said, “The world would not stop … We deal with sole-source contracts all the time.”

KC-X will provide the first 179 KC-135 replacements to the U.S. Air Force; estimated procurement price is about $35 billion.

Bush says his decision was made because the Pentagon’s revised source-selection methodology for this KC-X – the last award was terminated after a Boeing protest turned up procurement missteps – “clearly favors the smaller tanker,” which is Boeing’s 767-based proposal. Northrop/EADS was planning to offer a version of the Airbus A330, which won in the 2008 competition. “Investing further resources to submit a bid would not be acting responsibly.”

Both Northrop and Boeing, which is proposing a 767-based tanker, complained that the draft RFP issued in September put too much financial risk on the contractors. Pentagon officials responded in the final RFP by relieving some of the fixed-price elements of the deal.

Bush also says that “though we feel we have substantial grounds to support a [Government Accountability Office] or court ruling to overturn this revised source selection process, America’s service men and women have been forced to wait too long for new tankers.” He did not identify what those grounds would be for a protest, but he says the company will not protest the RFP.

Rep. Norm Dicks (D-Wash.), who is replacing the recently deceased Rep. John Murtha (D-Pa.) as the powerful chairman of the House Appropriations defense subcommittee, says the decision by Northrop will allow the Pentagon to “move forward expeditiously with the replacement of a KC-135 tanker fleet.” Dicks, a longtime Boeing supporter, adds that Northrop’s decision is “prudent” because the A330-based option would “clearly have been more costly to purchase, operate and maintain...I applaud the Northrop Grumman Corp. for its assessment and its decision not to delay the procurement by submitting a bid and requiring the government to conduct another lengthy competition.“

Another Boeing supporter, Sen. Patty Murray (D-Wash.), also sounded relieved that Boeing’s path had been cleared. But in a public statement she also warned Boeing that her oversight would turn to making sure the program performs. “Washington workers deserve this opportunity,” she said. “But today’s news is by no means the end of the line, and this contract is no slam dunk. It’s important to remember that the American people are the customers, and that we drive a hard bargain.”

Lawmakers from Alabama, however, which stood to gain work from both Northrop and Boeing, are disappointed. Sen. Jeff Sessions, who had a hold on two key Pentagon nominations for procurement officials (which were lifted last week), says that “this is truly a dark day for the American warfighter.” He says the Pentagon rewrote the competition in a “biased fashion.”

EADS North America Chairman of the Board Ralph Crosby makes clear in his statement that the decision not to bid was Northrop’s. “Northrop Grumman’s analysis of the RFP reaffirmed...concerns and prompted the decision not to bid.” EADS officials have not said whether they will proceed as a prime contractor with their own bid, or if they are working to secure another prime partner. The company was eyeing the tanker work as a justification to establish a stateside A330 assembly line. The facility eyed for Mobile, Ala., could also have later housed other commercial work at less cost than assembling aircraft in Europe.

[buglerbilly]

What are the chances that NG/EADS could offer a smaller aircraft like the A310 MRTT ? I mean if it's all pass/fail, it might even work out better for them; better yet, could screw round boeing for another round.

Sad as it is, I agree that Boeing will eventually take the contract.

No chance at all in my opinion, the only question now is whether EADS will go it alone with this new RFP?

[buglerbilly]

Ares

A Defense Technology Blog

Should EADS Go It Alone on KC-X?

Posted by Amy Butler at 3/8/2010 4:35 PM CST

Northrop Grumman has just left its longtime partner for the KC-X competition in the dust. But, does that mean it is over?

In his statement about Northrop's decision not to bid, EADS North America Chairman of the Board Ralph Crosby notes that the team was formed five years ago. But, five years ago, the company didn't have a prime contract with DOD in hand.

Now it does -- the Army's UH-72A Lakota deal. And, the U.S. Army seems quite happy with the performance. So, is it possible that with these creds in hand, EADS North America would go it alone?

Pros:
*The company really wants to have a stateside commercial airliner assembly line. Selling A330's to the U.S. Air Force was to provide the reason to do it. And, the facility -- slated for construction in Mobile, Ala., could also be expanded to build the A350 XWB or future single-aisle.

Cons:
*Hard times have hit with problems on the A400M and the A380, and the company may not want to risk putting more bid money down on a losing proposition.

[buglerbilly]

Tanker Manufacturers to Air Force: Later, Haters

By Nathan Hodge March 8, 2010 | 5:30 pm



European defense and aerospace consortium EADS and its U.S. partner, Northrop Grumman, have handed an apparent $35 billion dollar gift to rival Boeing — by packing up and going home.

In late February, the Air Force launched a contest to replace its fleet of Eisenhower-era KC-135 aerial refueling tankers. The Air Force envisioned spending $11.7 billion on the new planes over the next five years; over the life of the program, the service plans to buy a total of 179 aircraft, orders worth a potential $35 billion.

But Northrop and EADS complained that the guidelines weighed the contest in Boeing’s favor, and threatened to pull out of the contest unless the service revised the request for bids. And that’s exactly what happened today. EADS North America released the following statement from Ralph Crosby, Chairman of the Board:

Five years ago EADS partnered with Northrop Grumman, as prime, to pursue the U.S. Air Force KC-135 modernization program. Two years ago our team was selected and awarded the contract. Today Northrop Grumman has decided not to submit a bid to the Department of Defense for the KC-X program.

As a team, our serious concerns were expressed to the Department of Defense and the U.S. Air Force that the acquisition methodology outlined in the request for proposal (RFP) would heavily weigh the competition in favor of the smaller, less capable Boeing tanker. Northrop Grumman’s analysis of the RFP reaffirmed those concerns and prompted the decision not to bid.

The source selection methodology clearly signals a preference for a smaller aircraft.

The Air Force has been trying to buy a new tanker for around nine years. And now it looks like it may go to Boeing. And here’s the irony: Back in 2004, Republican Senator John McCain successfully helped block a tanker lease arrangement that he saw as a sweetheart deal for Boeing. (Of course, I was secretly convinced that the nearly decade-long Air Force tanker saga was really a scheme to keep people in the defense trade press gainfully employed.)

Politico’s Jen DiMascio has an awesome quote from Rep. Jo Bonner, the Republican who represents the Alabama political district where the Northrop/EADS team would have built the tankers if it had won.

“I wrote President [Barack] Obama last month and warned him the Pentagon was headed down a path that would kill the chance of competition in the tanker program,” Bonner said. “Apparently the Pentagon didn’t get the word and has handed the president a $35 billion sole-source hot-potato, under circumstances that are highly suspect.”

[PHOTO: U.S. Department of Defense]

Read More http://www.wired.com/dangerroom/2010/03/tanker-manufacturers-to-air-force-later-haters/#more-23092#ixzz0hdXY5riy

[buglerbilly]

DATE:08/03/10

SOURCE:Flight InternationalNorthrop Grumman declines to bid on latest KC-X RFP

By Jon Ostrower

Northrop Grumman, in partnership with EADS, will not offer a bid for the $35 billion KC-X tanker contract, citing a US Air Force request for proposal (RFP) it believes is weighted in favour of its competitor.

"We reached this conclusion based on the structure of the source selection methodology defined in the RFP, which clearly favours Boeing's smaller refuelling tanker and does not provide adequate value recognition of the added capability of a larger tanker, precluding us from any competitive opportunity," says Wes Bush, CEO of Northrop Grumman.

Additionally, Bush says that Northrop has decided not to protest the selection process, adding that "while we feel we have substantial grounds to support a [Government Accountabiity Office] or court ruling to overturn this revised source selection process, America's service men and women have been forced to wait too long for new tankers".

EADS echoed a similar sentiment about the KC-X selection process, but declined to say whether or not the European defence consortium would make its own bid to the US Air Force. However, those close to the process say the European company is in a "wait and see" position on any future developments.

Lockheed Martin has been rumoured to be a possible partner with EADS on a future bid.

Northrop Grumman had initially planned to offer the KC-45, based on the Airbus A330-200 Multi Role Tanker Transport, which is larger than the Boeing's NewGen tanker offering based on the smaller 767.

The latest chapter in the almost decade long tanker saga, sets up a potential political showdown between US Congressional supporters of the Northrop and those in support of Boeing, as well as the US Department of Defense as Boeing is left to bid as a sole-source contractor to the US Air Force to replace its aging KC-135 tankers.

US President Barack Obama has repeatedly stressed his opposition to sole-source contracts as a bad deal for the taxpayer, who is responsible for financing the acquisition.

Bush disclosed that the final price Northrop Grumman would have offered on the first 68 tankers was a unit flyaway cost of $184 million, including non-recurring development costs.

In a parting shot against its competitor, the price disclosure could pressure Boeing to offer a lower price on what Northrop calls "a smaller, less capable design", adding that the "taxpayer should certainly expect the bill to be much less".

Boeing declined to comment directly on Northrop's publication of its offering price for the tanker contract, but says it will offer a lower total life cycle cost than its competitor, a different measurement than the flyaway unit cost touted by Northrop.

[buglerbilly]

This article is wrong, EADS hasn't announced its withdrawal yet.........formally..........

EADS drops bid for US air force tanker contractAerospace company gives up fight to build refuelling aircraft that would have secured thousands of jobs

Andrew Clark in New York guardian.co.uk, Tuesday 9 March 2010

After a two-year struggle against American protectionism, the European aerospace company EADS has given up fighting for a $35bn (£23.3bn) contract to build refuelling aircraft for the US air force that would have guaranteed thousands of manufacturing jobs in Britain, France, Germany and Spain.

EADS and its US partner, Northrop Grumman, announced late yesterday that they would not submit a fresh bid for a contract to make 179 tankers to replace the ageing American military fleet of mid-air refuelling planes, leaving the field clear for the all-American Boeing team to pick up the work.

The decision ended a bitter political furore over the deal, which is among the biggest US defence procurement projects on record.

EADS and Northrop won the contract in 2008, prompting an outcry at the height of the US presidential election campaign about sensitive military work going overseas.

After a formal protest from Boeing and a long delay, the Pentagon restarted the tender contest last month.

Withdrawing from the fray, EADS accused the US government of redrawing its criteria for the refuelling tankers to "heavily weigh the competition" in favour of Boeing's "smaller, less capable" proposed aircraft.

Northrop Grumman said although it had good legal grounds to challenge the redrawn criteria, it did not feel it would be responsible to delay the process further: "America's servicemen and women have been forced to wait too long for new tankers."

The decision represents a blow to 13,000 British workers employed at EADS's Airbus factories in north Wales and Bristol.

Under the trans-European proposal, the wings for the planes would have been made in Britain, fuselages in France and Germany, tails in Spain and the aircraft would have been equipped by Northrop in the US. During the US election campaign in 2008, Barack Obama and his rival Democratic contender, Hillary Clinton, both condemned the contract's award to an international consortium, criticising the "outsourcing" of jobs and critical national security to overseas suppliers.

Bob Riley, governor of Alabama where Northrop would have fitted out the EADS aircraft, last night criticised the Pentagon for "disgraceful" handling of the deal: "When the air force is compelled by politics to select the slower, smaller and older plane, no one can say with a straight face that this is what's best for America or America's warfighters," he said.

[buglerbilly]

Ares

A Defense Technology Blog

No EADS KC-X Solo Bid, Says Gallois

Posted by Robert Wall at 3/9/2010 2:01 AM CST

EADS will not mount a solo bid in the KC-X tanker program, the company's chief executive Louis Gallois says.

Northrop Grumman's decision not to pursue the KC-X program, offering the Airbus A330-200, was not been well received in Europe. EADS officials were visibly upset at the turn of events when the new broke.

For EADS, there has been a lot riding on the KC-X program. In addition to the significant dollar value, the company's ambitions to grow its footprint in the U.S. market has been integral to its long-term business plan. Both the size of the U.S. defense budget and the need to provide so called natural hedging against the euro-dollar imbalance have driven its American agenda.

EADS will still need to pursue that strategy, it just now needs to find a new route to success.

Gallois notes that "the US tanker decision does not diminish our commitment to the U.S."

[Wolftrap]

Yes, interesting twist. The most witted piece of commenting i've seen so far on this has come from Giovanni de Briganti over at Defense Aerospace though. Particularly like the ending that sums this odyssey up quiet well:

Somehow [...] Boeing’s victory by default takes on a decidedly Pyrrhic flavour.

[Milne Bay]

I can't help thinking that the Americans will now get the tanker solution that they deserve .....................................

[Gubler, A.]

How can Boeing having a no contest tender be considered “Pyrrhic”? Running the 767 production line for KC-X is a huge money maker for Boeing. Why they’ve played for the contract so hard. They don’t have anything to lose if they win!

Anyway the RFT hasn’t closed yet. EADS has the potential to still offer the A330 (or even A310) for KC-X with another US prime. Perhaps a quick tender submission turn around with their JCA partner Raytheon?

[buglerbilly]

Northrop Grumman/EADS team pulls out of US KC-X tanker competition

Northrop decides not to submit bid due to source selection methodology

defpro.com | European aerospace giant EADS has experienced some hot days since last Friday. It began with an important step forward which was achieved in the future European airlift programme on Friday afternoon when EADS and the customer nations for the A400M reached a principal agreement on the funding of the aircraft. Further, today EADS reported its 2009 results that led to a loss of share value in pre-market trade in Frankfurt, also due to the company’s heavy losses in 2009, the scrapping of its dividend and a poor outlook going into 2010 (see http://www.defpro.com/news/details/13647). But most important, yesterday’s announcement by Northrop Grumman and EADS not to submit its bid to the US Air Force KC-X tanker competition is poised above all further developments.

The announcement of this remarkable decision, in particular including the decision not to protest against the RfP and thereby not further delaying the programme, was released by Northrop Grumman on Monday. Wes Bush, Chief Executive Officer and President of Northrop Grumman Corporation, announced the decision in a wide-ranging statement, saying “After a comprehensive analysis of the final RfP [Request for Proposal], Northrop Grumman has determined that it will not submit a bid to the Department of Defense for the KC-X program. We reached this conclusion based on the structure of the source selection methodology defined in the RfP, which clearly favors Boeing's smaller refueling tanker and does not provide adequate value recognition of the added capability of a larger tanker, precluding us from any competitive opportunity.”

This decision deals a heavy blow to the EADS’ plan to gain a stronger foothold on the US market, which traditionally has been a tough market to enter for non-US companies. Boeing and its supporters throughout the entire industrial and political sphere have repeatedly used the significant share of EADS in the competitor’s team to promote its “buy American” solution. Despite Northrop Grumman’s efforts to emphasise that most of the work would be performed in the US and that the order would create hundreds of jobs in Alabama, the team could not avert the general perception that it was a European solution.

Winning the competition against its archrival Boeing, the KC-X tanker contract would have been a wholesome bonanza for EADS. According to the Aircraft Investment Plan of the US Air Force, recently released to Congress, the service intends to buy 109 tankers at an estimated cost of over $30 billion (€22 billion) through 2020. Beyond this year, the Air Force would have to replace its entire ageing fleet of tankers, which would have provided Northrop Grumman and EADS with stable revenue of over $100 billion, not including earnings generated by maintenance and spare part support.

The decision not to submit a bid to the competition is even more dramatic in light of the fact that the KC-30 (designated KC-45A by the USAF) tanker solution of Northrop Grumman and EADS had already been awarded a contract by the US Air Force in 2008 which, subsequently, was cancelled due to a protest filed by Boeing.

All parties disappointed ... except for one

In his statement, Bush added: “We continue to believe that Northrop Grumman's tanker represents the best value for the military and taxpayer – a belief supported by the selection of the A330 tanker design over the Boeing design in the last five consecutive tanker competitions around the globe. Regrettably, this means that the U.S. Air Force will be operating a less capable tanker than many of our Allies in this vital mission area.”

Airbus CEO Tom Enders underlined the assessment of its US partner and said “If Northrop Grumman is convinced that we don’t have a chance to win in the current environment – no matter how good our offer is - then I can only support this assessment. Today, the German government called on the US to revisit its contract awarding policy. As Peter Hintze, aviation coordinator of the German government told a German daily, he sees “a tiny rest of a chance that the US government perceives this signal and will revise the [contracting] procedure.”

While Northrop Grumman emphasises that the competition would not have been fair and that the terms of the competition focus on a smaller platform (which allegedly would automatically rule out the A330 MRTT-based tanker), US officials dismiss any such reproaches. Deputy Defense Secretary William Lynn expressed his disappointment in Northrop Grumman’s decision, saying: “In the last tanker replacement competition, Northrop Grumman competed well on both price and non-price factors. We strongly believe that the current competition is structured fairly and that both companies could compete effectively.”

Lynn further explained that “based on the inputs we received from both offerors to the Department’s draft Request for Proposal (RFP), we made changes to reduce the out-year risk to the potential manufacturers of KC-X. However, we did not change the war-fighters’ requirements to accommodate either offeror.”

One can hear the corks popping in Seattle all the way in Europe, although Boeing statements so far have been rather sparse and reserved. Boeing tanker spokesman William Barksdale said: “Boeing remains 100 percent focused on the KC-X competition and intends to submit a fully responsive, transparent and competitive proposal that meets the terms the Air Force has announced. As we have in each of the previous rounds of competition, Boeing will offer the most capable tanker and the tanker best suited to begin modernizing the aging KC-135 fleet - at a lower total life cycle cost than any competitor. The Boeing NewGen Tanker will be safe and survivable in combat, will save the American taxpayer $10 billion in fuel costs over its 40-year life, and is American designed and built.

Mixed opinions in East and West

Next to Arizona Republican Senator John McCain, who has been one of the fiercest critics of the Boeing solution, Senator Richard Shelby (R) of Alabama has been a strong supporter of Northrop Grumman as the company’s tanker assembly plant would have been constructed in his state. Reacting to Northrop's announcement, Shelby said: “This so-called competition was not structured to produce the best outcome for our men and women in uniform; it was structured to produce the best outcome for Boeing. The Air Force's refusal to make substantive changes to level the playing field shows that once again politics trumps the needs of our military."

More enthusiastic about yesterday’s decision, Senator Maria Cantwell (D-Wash.) said on Monday: “Today's announcement by Northrop Grumman is a significant development in what has been a long effort to get a new and much needed air refueling tanker to our military. Secretary of Defense Gates has personally assured me that he is going to move ahead with this bidding process regardless of the number of bidders. It appears that as a result of Northrop's decision not to bid on the tanker and not to protest the Pentagon's request for proposal (RFP), that Washington will be the beneficiary of more than 12,000 jobs, with over 50,000 jobs associated with this contract nationwide.

She is supported by Washington Senator Patty Murray (D), stating: “Washington workers deserve this opportunity. They have delivered a combat ready tanker before and they're ready to do it again. But today's news is by no means the end of the line, and this contract is no slam dunk. It's important to remember that the American people are the customers, and that we drive a hard bargain.”

Despite the assessment by defence analyst Lauren Thompson of the Lexington Institute saying she doesn’t believe “that the Pentagon has a plan for what they're going to do now, because their whole solicitation was based on the assumption of competition,” the Air Force will have to go on with its procurement programme somehow. According to a Seattle-based online news service, Democratic Representative Rick Larson warned that sole-source contracts “don't tend to be good deals for the taxpayers, as a general rule.” Thompson extended these warnings by saying that Boeing could get into trouble if it bids too high, but actually is likely to find the fixed-price provisions of the tanker request limit its profitability. “They could end up breaking even or losing money,” noted Thompson.

----
By Nicolas von Kospoth, Managing Editor

[buglerbilly]

No Solo KC-X Bid for EADS

Mar 9, 2010

By Robert Wall wall@aviationweek.com
PARIS

EADS will not mount a solo bid for the U.S. Air Force KC-X tanker program, ending the company’s highest profile effort to grow its footprint in the U.S. market.

EADS CEO Louis Gallois ruled out a solo bid a day after the Northrop Grumman-led team involving EADS and the Airbus A330 said it would not respond to the Pentagon’s request for proposals (RFP), saying the tender favored the Boeing-offered KC-767. He also rejected the notion of partnering with someone else.

CFO Hans-Peter Ring says that discussions on cancelling the original KC-45 deal continue, but will not materially impact the company.

Despite the setback, Gallois insists “the U.S. tanker decision does not diminish our commitment to the U.S.” EADS already has its eye on the next round of competitions, including the Army’s armed scout helicopter and the Air Force’s Common Vertical Lift Support Platform. Moreover, the U.S. remains a target for acquisitions, although EADS isn’t planning any big deals near term as it remains focused on preserving cash.

On the A400M, Gallois says a contract to reflect Friday’s agreement on the way forward is expected in a few weeks. It will remain a fixed-price contract, something EADS originally rejected. However, Gallois says there is enough margin back in the program to allow the company to remain with that kind of a contractual structure.

The €1.8 billion charge associated with the A400M for 2009 was largely responsible for driving EADS full-year results into the red. The company booked a net loss of €763 million, on revenue of €42.8 billion.

The charges did not account for all the risk an independent audit identified, but Gallois believes restructuring of the program that is being completed now will reduce the risk of the €3.6 billion becoming reality.

The A400M saga will not be over for some time, however. Claims suppliers have against the prime contractor, as well as those from the prime contractor against suppliers, will take years to sort out, Gallois notes.

Other issues to be resolved is how to structure royalty payments countries will get on export sales as a result of the €1.5 export financing levy they are providing as part of the A400M restructuring. Gallois says there is an agreement to keep the royalty payment at a level so it will not hurt export pricing.

Meantime, European political leaders are blasting the U.S. for perceived protectionism on KC-X, saying the request for proposals favored rivals.

Although it had no direct involvement in the program, European Union’s trade commissioner, Karel de Gucht says that “it is highly regrettable that a major potential supplier would feel unable to bid for a contract of this type. Open procurement markets guarantee better competition and better value for money for the taxpayer.” The EU says it will watch the situation further.

U.S. Deputy Defense Secretary Bill Lynn attempted to address such concerns immediately in reacting to Northrop’s withdrawal. “The department strongly supports trans-Atlantic defense industrial ties and believes they benefit the American war-fighter and taxpayer,” he said late March 8.

The EU notes that defense trade balance has heavily favored the U.S. In 2008, the U.S. exported $5 billion from EU members and imported only $2.2 billion. The statement comes as the EU is still trying to bring down trade barrier on intra-EU defense trade.

The European Union’s message was echoed by Germany’s economics minister Rainer Bruederle. The RFP clearly favored Boeing, he says, adding that “also in defense procurement, free trade should not be curtailed. Particularly in the current economic downturn, event indicators of protectionism are damaging.”

[buglerbilly]

Ares

A Defense Technology Blog

Applauding Northrop's "No Thanks"

Posted by Joe Anselmo at 3/9/2010 12:10 PM CST

Jefferies & Co. analyst Howard A. Rubel was surprised by Northrop Grumman’s decision not to support a joint bid with EADS for the U.S. Air Force’s aerial-refueling tanker competition. Oppenheimer & Co.’s Myles Walton was not surprised. But both analysts share the opinion that Northrop’s decision was a sound one.

“Northrop had a large share of the risk, while it carried only a modest benefit as the commercial synergies would inure to [EADS-owned] Airbus,” Rubel said in a note to his clients on Tuesday. “The action to stop the process before the bid is submitted reflects well on management.”

The Northrop Grumman/EADS team won the $35 billion tanker contract two years ago with its Airbus A330-based aircraft, only to have it yanked away on an appeal from Boeing. But Walton notes that the team now faces a different leadership team at the Pentagon and a different request for proposal and contract structure. “The decision came down to economics that left Northrop Grumman with the choice to submit a token bid in the name of competition or try to compete on price with a more expensive – but more capable – aircraft, and potentially end up with a fixed-price contact that could dramatically increase the risk profile of Northrop Grumman’s future earnings and cash flows,” Walton told his clients. “This contract has always been a “must-win” for Boeing and “nice-to-have” for Northrop Grumman.”

Both analysts agree that a sole-source award would not give Boeing carte blanche to inflate its tanker bid.

Rubel notes that Northrop’s per-unit price of $184 million per tanker in the original contract sets a benchmark that Boeing will have to beat with its smaller 767-based aircraft. “Boeing is aware that it must justify its bid to Congress, the Defense Dept. and other decision makers,” he says. “This is about reputation. Poor performance will impact the outcome of other competitive decisions.”

[buglerbilly]

EU warns US against protectionism in Pentagon deal

By SLOBODAN LEKIC (AP) – 8 hours ago

BRUSSELS — The EU on Tuesday warned the United States against protectionism after a European-led consortium pulled out of the bidding for an Air Force contract, saying the terms had been altered to favor a U.S. company.

EADS, the parent company of Airbus, had partnered with Northrop Grumman to vie for the 179 tanker order, but their consortium pulled out on Monday. They said the terms of the deal appeared designed to eliminate its design in favor of a smaller jet offered by rival Boeing Co.

The announcement left Boeing as the only bidder for the project. It is offering a version of the 767 commercial airplane to replace the U.S. Air Force's 1960s-era fleet of KC-135 tankers.

"The European Commission would be extremely concerned if it were to emerge that the terms of tender were such as to inhibit open competition for the contract," the European Commission said in a statement.

In the United States, the political fallout from the announcement was also swift, with several U.S. lawmakers — including Sen. John McCain, R-Ariz., President Barack Obama's campaign rival in 2008 — saying they regretted the Northrop Grumman/EADS decision.

In 2008, the EADS-led consortium was awarded a contract for the tanker fleet, but Boeing protested and the deal was annulled later that year.

In December, Northrop Grumman/EADS expressed serious concerns to the Pentagon and the Air Force that the new criteria for the project were slanted in favor the Boeing design.

"It is highly regrettable that a major potential supplier would feel unable to bid for a contract of this type," said EU Trade Commissioner Karel De Gucht. "Open procurement markets guarantee better competition and better value for money for the taxpayer."

The EU noted that the trade balance in defense equipment with the 27-nation EU has traditionally been heavily in favor of the American side, and that in 2008 the US exported $5 billion worth of defense materials while importing only $2.2 billion from the European side.

"The Commission will be following further developments in this case very closely," the statement said.

In Washington, Pentagon spokesman Bryan Whitman said the military plans to move ahead with the program and that the requirements for a new tanker fleet won't be reworked just to ensure there are two bidders.

"The question for us is, competition at what cost?" Whitman told reporters. "We know what the requirements are . . . we are going to buy to those capabilities."

Meanwhile, German Economy Minister Rainer Bruederle said on Tuesday he was disappointed by the developments in the U.S. and warned the situation had "signs of protectionism."

"The free market should not be unilaterally restricted," he said.

Twenty-eight of the EADS KC-45 tankers have been ordered or are already in service with the air forces of Australia, Britain, Saudi Arabia, and the United Arab Emirates. Boeing's KC-767 tanker, which can carry a smaller payload, has been ordered by Italy and Japan.

In Paris, EADS CEO Louis Gallois maintained that the EADS design — based on Airbus A330 — makes a better tanker than the Boeing alternative.

"We deeply regret that the U.S. Air Force will not get the best available airplane," he told journalists.

He said the decision doesn't change EADS' intention to boost its presence on the American defense market.

Gallois said the consortium was talking to the administration in Washington to recoup some of the money it spent on its bids.

Also on Tuesday, EADS reported that spiraling costs on its new military airlifter, the A400M, and its A380 superjumbo had led to losses in the fourth quarter and full year but said its outlook visibility was improving.

Associated Press correspondents Anne Flaherty in Washington, Emma Vandore in Paris and David Rising in Berlin contributed to this report.

Copyright © 2010 The Associated Press. All rights reserved.

[buglerbilly]

Statement by Deputy Secretary William Lynn on Northrop Grumman Tanker Announcement

(Source: US Department of Defense; issued March 8, 2010)

“We are disappointed by Northrop’s decision not to submit a bid for the U.S. Air Force tanker replacement program.

“In the last tanker replacement (KC-X) competition, Northrop Grumman competed well on both price and non-price factors. We strongly believe that the current competition is structured fairly and that both companies could compete effectively.

“Based on the inputs we received from both offerors to the Department’s draft Request for Proposal (RFP), we made changes to reduce the out-year risk to the potential manufacturers of KC-X. However, we did not change the war-fighters’ requirements to accommodate either offeror.

“The Department strongly supports trans-Atlantic defense industrial ties and believes they benefit the American war-fighter and taxpayer.”

-ends-

[Wolftrap]

How can Boeing having a no contest tender be considered “Pyrrhic”? Running the 767 production line for KC-X is a huge money maker for Boeing. Why they’ve played for the contract so hard. They don’t have anything to lose if they win!

Anyway the RFT hasn’t closed yet. EADS has the potential to still offer the A330 (or even A310) for KC-X with another US prime. Perhaps a quick tender submission turn around with their JCA partner Raytheon?

Well, i understand "phyrric" not from Boeings point of view but more the Pentagon's. Three tenders, how many in jail und how many years of delay and sunk money just to be ... back at the start.

[buglerbilly]

Tanker ‘Soap Opera’ May Not End With Northrop Pass (Update1)

March 09, 2010, 12:34 PM EST

By Susanna Ray and Andrea Rothman

March 9 (Bloomberg) -- Northrop Grumman Corp.’s decision to forgo bidding on the U.S. Air Force’s $35 billion refueling tanker program, leaving Boeing Co. without a competitor, may not mark the end of a nearly decade-long quest to replace the military’s existing fleet, a Boeing executive said.

“I’ve been working this program for nine years,” Jim Albaugh, head of Boeing’s commercial aircraft and former chief of its defense unit, said in a presentation today at a JPMorgan Chase & Co. conference broadcast on the Web. “It’s the longest- running soap opera since ‘Days of Our Lives,’ and I’m not sure we’ve seen the last episode.”

Northrop, which had partnered with European Aeronautic Defence & Space Co. in a winning bid for the tanker that was overturned last year, announced its decision yesterday. The move made good on Northrop’s December threat to withdraw unless the government altered some of its requirements.

Los Angeles-based Northrop complained at that time that the new draft proposal of bid requirements appeared to favor Boeing’s entry and that the contract would impose “financial burdens.” The contest had been restarted three months earlier, in September, after Boeing successfully protested the 2008 award to Northrop.

Northrop and EADS, parent of Boeing rival Airbus SAS, based their tanker proposal on the Toulouse, France-based company’s A330, while Boeing will use its smaller 767 as a platform.

No ‘Competitive Opportunity’

The selection methodology outlined in the Pentagon’s bid request favored Boeing’s smaller aircraft and didn’t recognize the added value from a larger tanker’s increased capability, eliminating “any competitive opportunity,” Northrop Chief Executive Officer Wes Bush said in a statement yesterday.

EADS Chief Executive Officer Louis Gallois said today that his decision to abandon the $35 billion U.S. tanker bid is final, as some European politicians suspected local favoritism.

“I don’t see any opportunity to come back alone or with others,” Gallois said at a press conference in Paris. “If Northrop makes the analysis that we cannot win, I don’t think we can say that we will do it alone.”

The original tanker replacement concept was created in late 2001 by the Senate Appropriations Committee with a proposal to lease and then buy Boeing tankers.

Northrop’s decision to quit will probably lead to a sole- source contract for Boeing, said U.S. Representative Jo Bonner, a Republican from Alabama, where Northrop planned to build a plant if it won the project.

The tanker project’s future is “really in the hands of the customer right now,” Albaugh said today.

Chicago-based Boeing climbed $1.01, or 1.5 percent, to $68.25 at 12:26 p.m. in New York Stock Exchange composite trading. Northrop fell 6 cents to $64.10.

--With assistance from Gopal Ratnam in Washington. Editors: James Langford, Will Daley

To contact the reporters on this story: Susanna Ray in Seattle at sray7@bloomberg.net; Andrea Rothman in Paris at aerothman@bloomberg.net.

To contact the editor responsible for this story: James Langford at jlangford2@bloomberg.net

[Milne Bay]

Is there a wider repercussion to this whole shameful episode?
Reports suggest that it is not simply EADS that is a little upset at the way the cards were stacked against them.
The reaction from Europe generally appears to be one of outrage.
Has this damaged US/Europe relations to the point that it will impact on US foreign military sales in a wider and more general way?
I would be interested in opinions on this.
MB

[buglerbilly]

Ares

A Defense Technology Blog

US-Europe trade war looms in wake of air tanker decision

Posted by Christina Mackenzie at 3/10/2010 4:46 PM CST

A Trade War is never going to happen over this and yes, the contest has been "fixed" to the benefit of Boeing BUT they are the ONLY major airliner manufacturer left in the USA so anyone that thinks they are going to be sacrificed for a few jobs in Southern States is dreaming!

IF Boeing screws this one up they are DEAD baby........gone bye byes!!!

The specter of a US-Europe, Boeing/Airbus trade war has risen its ugly head again in the wake of the decision by Northrop-Grumann and EADS to pull out of the US Air Force tanker competition. Senior European government officials are blaming Washington for forcing the decision which the partners made after deciding the request for proposal was biased towards the Boeing aircraft.

The European Commission said the withdrawal was “highly regrettable” but others were less diplomatic.

The French Prime Minister said on March 10 that Washington is distorting international competition: “I think the attitude of the US government on the air tanker affair is a grave distortion of the rules which are those of loyal competition between our economies.” Fillon added that the rules of the game were weighted by the US towards Boeing and so forced EADS, which owns Airbus, out of the contest.

EADS CEO Louis Gallois said on March 9 at the group's annual results' press conference that “the Request for Proposal is based on a smaller, less capable aeroplane which gives a huge advantage to Boeing.” And he added with a smile “it means that Australia, the United Kingdom, Saudi Arabia and the United Arab Emirates will have a more capable airplane that the US Air Force.”

Pierre Lellouche, the French secretary of state for European affairs said there would be “a reaction” from France. “It's obvious that if one just lays down in front of the Pentagon's fait accompli and nobody says anything then the credibility of Europe is over... Defense Europe must exist and in order to do so an industry must exist and must make itself respected,” he added. He angrily recalled that a first “contract [with EADS] had been signed before being cancelled” and pointed out “that we are accused all day of being protectionist, but the truth is that we are open while others are totally closed, and this is not normal.”

Meanwhile Luc Chatel, the French government spokesman, said President Nicolas Sarkozy would “have the opportunity to discuss this issue with President Obama during his upcoming visit [on March 30] to the United States.”

According to French press agency AFP, a ruling party parliamentarian, Bernard Carayon, accused “senior Pentagon officials” of corruption”. “We can't play with cheats” he said estimating that “Northrop-Grumann's abandon” was obtained thanks “to compensation from the US Administration.”

Spain and Germany, the other major shareholders in EADS, are also upset. Rainer Brüderle, Germany's economy minister, expressed outrage alleging that the tender "had clearly been designed to favour Boeing under political pressure" and said the case should be put to the World Trade Organization. However, the WTO does not usually handle defense industry disputes.

Joachim Pfeiffer, Bundestag spokesman for the Christian Democrats, said the Pentagon's conduct was "scandalous", a sentiment echoed by a string of politicians on Wednesday while Bernhard Stiedl, a member of the EADS board, said Europe needs to rethink its whole approach to defense in light of the affair.

Spain's secretary of state for trade, Silvia Iranzo, said on March 10 that “no common position [within the European Union] had yet been defined but many things are moving.” Spanish industry will lose about €2.5 million-worth of business in the affair notably because the refuelling boom of the aircraft is made in Spain.

[McDethWivFries]

Has this damaged US/Europe relations to the point that it will impact on US foreign military sales in a wider and more general way?


yeah i've been wondering the same myself. There was a post on the old forum where they compared how "American" both the Boeing & NG/EADS bids were due to all the philibuster about how Boeing was the only American tanker blah blah blah. iirc the result was that the NG/EADS bid turned out having more components etc manufactured in America than Boeings did, most of Boeings were manufactured in China or something. Of course this could've been talking about the 787 v A330 rather than the 767.

[Chunder]

The thing with the yanks, specifically west coast ones is, they honestly believe along with the IFTPE or whatever it is, that the Airbus is an inherently evil & inferior aircraft. It's like the ford vs Holden punch ups at Bogan central race day. You browse around the forums and you'd walk away believing that any action is appropriate so long as it stops people flying on an airbus. Trying walk away with something intelligent coming from them under such circumstances is like trying to take health tips from a leper with chilamy. You can't even begin to take em seriously.

Incredible really.

I don't think the 767 is anywhere near what is actually needed for a number of reasons, but then again the USAF knows what it wants as opposed to seeing what it can get - out of a competition.

[Wolftrap]

Is there a wider repercussion to this whole shameful episode?
Reports suggest that it is not simply EADS that is a little upset at the way the cards were stacked against them.
The reaction from Europe generally appears to be one of outrage.
Has this damaged US/Europe relations to the point that it will impact on US foreign military sales in a wider and more general way?
I would be interested in opinions on this.
MB

Hey there Milne,

reading the local papers, the angle seems to be that the competition was supposed to be an even playing field for foreign tenderers as well while it is now claimed it never was. So it is not that everybody expected this to be impartial per se, they cry foul because the original guidelines under which the tender was set up appear not to be adhered to. Reality vs verbal/written assurance...

In general i would agree with bugs that the risk of a "trade war" is exagerated - least of all EADS has an interest in this. And why shouldn't some journalist fall into the row of bitching? Especially french journalists do have the argument that France indeed acquired US MRAPs, Hellfire II and Javelins. In total EUR not comparable to KC-X, but relatively speaking to the defense budget and industrial-political wise very much noteworthy.

[buglerbilly]

EADS Was Unable To Prime On KC-X

Mar 11, 2010



By Amy Butler

EADS North America Chief Executive Officer Sean O’Keefe says that while his company has built up its capacity to manage its first Pentagon prime contract — the UH-72A helicopter — its abilities are not mature enough to justify going it alone on a bid for the massive U.S. Air Force KC-X tanker contract.

EADS’s prime contractor partner, Northrop Grumman, announced March 8 that it would not bid for the contract to build 179 KC-135 replacements, an order valued at about $35 billion. This leaves the Pentagon with a sole-source deal for Boeing’s 767-based design (Aerospace DAILY, March 9).

The partnership was forged more than five years ago with Northrop Grumman to leverage the company’s “near-peerless” reputation in systems integration, program management and government compliance processes, O’Keefe said March 9. “We’re developing all of those capabilities too,” he says. “We do not have anything near that in place that would rival that capacity. We could not bring that to the equation alone.”

Overall, EADS was much more eager to compete, but with Northrop at its side. The final call was apparently Northrop’s. “Our partners at Northrop Grumman were very concerned with the fixed-price contract,” he says. “We were not as concerned.” O’Keefe notes that Airbus, which would have supplied the A330-200 airframes, routinely delivers on fixed-price contracts with its airline customers.

The Pentagon’s final KC-X request for proposals includes a fixed-price incentive fee development contract and fixed-price production. There would be two opportunities to renegotiate the production price.

The Northrop Grumman/EADS team won a $1.5 billion contract in February 2008 to develop a new tanker for the Air Force, but it was terminated after a Boeing protest led to the discovery of procurement missteps by the armed service. That was the second effort to buy new tankers, after an earlier lend-lease award to Boeing ended in procurement scandal and political criticism.

O’Keefe notes that while the total KC-X effort was much larger, the UH-72A work is worth about $1.5 billion, with 250 more aircraft to be delivered to the U.S. Army alone.

He says the North American subsidiary of the European company is planning to focus on future U.S. business opportunities, including the Army’s Armed Scout Helicopter and some electronics business for the Homeland Security Dept.

But the tanker deal was the linchpin of the company’s major organic growth target in the U.S., the largest defense market in the world.

It is likely that acquisitions could become a focal point if the company intends to grow more stateside. “We are probably not going to meet the growth goals. They are obviously going to have to change,” O’Keefe says.

Finally, O’Keefe says the decision not to bid is a reflection of the economic climate, not protectionism on the part of the U.S. government.

Photo: Northrop Grumman

[buglerbilly]

Spokesman: Europe To Challenge U.S. on Tanker Contest

By pierre tran

Published: 11 Mar 2010 12:29

PARIS - European governments have the right to ask Washington for explanations on the U.S. Air Force tanker tender following Northrop Grumman's decision not to bid, the French Defense Ministry said March 11

"For the Defense Ministry, it is difficult to understand how an aircraft that was declared in 2008 to respond perfectly to American needs no longer meets these needs after a modification of the tender," Gen. Christian Baptiste, deputy spokesman for the Defense Ministry, told journalists.

Nobody says it doesn't meet the needs but the evaluation parameters have been moved to bias one as opposed to the other............

In its bid for the $35 billion Air Force contract to build aerial refueling planes, Northrop teamed up with EADS to offer a tanker plane based on the Airbus A330. Airbus is a subsidiary of EADS, the European defense and aerospace group, and it is headquartered in Blagnac, France.

Chicago-based Boeing has offered a converted version of its 767 airliner.

"European leaders have had the occasion to raise the problem [with the Northrop-EADS bid] several times with the American authorities, and faced with this situation, the European countries can legitimately ask for an explanation," Baptiste said.

An explanation as to why a Private Company has decided not to bid for an RFP? Seriously Mon General get real here.......

In other reaction to Northrop's withdrawal from the tanker contest, EADS Chairman Louis Gallois refused to rule out going ahead with another partner on the bid, even though it was highly unlikely.

Asked on RTL radio if his company's exit from the competition was definitive, Gallois said the decision had been made by its U.S partner, Northrop, which knows the U.S. market very well.

"If we want to stay in, we would have to find another American partner, because there is some extremely sensitive equipment in that plane which we can't supply," he said. "We need an American partner, but can you find another partner in 60 days and set up the bid? That seems highly improbable."

Gallois said the tender terms were "biased," as they gave a decisive advantage to Boeing's smaller aircraft. In the absence of a competition, the American taxpayer would pay more for the tanker fleet, he said.

Asked if the protest by European governments was in vain, he said, "Let's see. We can't prejudice the future. Maybe the Americans will extend the competition; you never know."

BS they will............

The French daily newspaper Le Figaro reported March 10 on its Web site that French President Nicolas Sarkozy planned to raise the tanker issue with President Obama when they meet in Washington at the end of the month.

Gallois said he understood that was Sarkozy's intention, although he had not had direct contact with the French president.

Northrop announced March 8 its decision to pull out of the tanker competition, in view of what it said were terms in the request for proposals that favor the Boeing 767.

[buglerbilly]

Source: EADS Seeking New Tanker-Bid Partner

By JOHN REED

Published: 12 Mar 2010 15:46

The U.S. Air Force's $35 billion KC-X competition may not end up being a sole-source competition. It appears that EADS is looking to buy time to find a new partner to bid against tanker rival Boeing.


European defense giant EADS has asked the Pentagon for additional time to find a new partner to bid in the $35 billion KC-X competition for the U.S. Air Force, according to numerous sources. (ROMEO GACAD / AFP VIA GETTY IMAGES)

"We're hearing that EADS has approached [the U.S. Defense Department] and asked for an extension to the tanker bid submittal deadline," which is in mid-May, one congressional aide said March 12.

A DoD official said later in the day, "We are neither encouraging or discouraging EADS from bidding. That said, it's not uncommon for us to extend RfPs a reasonable amount of time. But we haven't been asked to do so in this instance."

Meanwhile, Pentagon acquisition chief Ashton Carter dodged questions from reporters on the matter during a March 12 press conference at the Pentagon. All Carter would say is that the Pentagon "values the contribution of European industry to the choices that we can make as a department." He said that although the Pentagon doesn't have "an indication of any additional bidders, DoD is happy to have a competition."

EADS North America spokeman Guy Hicks said March 12, "We don't comment on any communications between [EADS] and our customers."

One senior EADS official said earlier this week that he had serious doubts the company has enough time to find a new U.S. partner that could handle a $35 billion deal, such as Lockheed Martin, L-3 Communications or Raytheon.

However, Raytheon issued a cryptic statement March 12 when asked whether company officials were in talks with EADS about a tanker partnership.

"We have the technology and capabilities to support the tanker program in a number of ways, but we have to refer [inquiries on the matter] to EADS," a company spokeswoman said.

Lockheed and L-3 were unavailable for comment at press time.

Three U.S. lawmakers with large numbers of Boeing employees among their constituents - Sen. Sam Brownback (R-Kan.), Sen. Pat Roberts (R-Kan.), and Rep. Todd Tiahrt (R-Goddard) responded March 12 to reports of EADS' deadline request: "Delay is unacceptable. Dragging out this competition hurts our warfighters and costs the taxpayer," Brownback said.

Several analysts said time may have run out for EADS.

"Finding someone else would be tough to do unless they have already done the groundwork" to establish a brand new KC-X partner, Center for Strategic and Budgetary Assessments Senior Fellow Mark Gunzinger said March 10.

Richard Aboulafia of the Teal Group was even more dubious, saying in a March 9 e-mail when asked whether he thought the Air Force might grant EADS extra time to put together a new tanker partnership: "Hell, no. EADS today said they were withdrawing - period."

Aboulafia was referring to comments made that day by EADS Chairman Louis Gallois.

"When Northrop Grumman, which is one of the most important defense suppliers in the United States, makes the analysis that they have no chance to win, I don't think that we have more chance going alone," he said. "That's clear for us."

Loren Thompson of the Lexington Institute said neither Raytheon or L-3 can manage a large aircraft production program. "They've never built a tanker," he said. "This whole thing sounds unlikely."

In March 10 testimony, Air Force leaders told lawmakers they intended to move ahead with program as scheduled.
---
John T. Bennett and Vago Muradian contributed to this report.

[buglerbilly]

Sarkozy, Brown Criticize Pentagon Over Tanker Bid

AGENCE FRANCE-PRESSE

Published: 12 Mar 2010 10:07

LONDON - French President Nicolas Sarkozy criticized the United States on March 12 over bidding rules for a tanker jet contract, saying it was not the way for Washington to treat its European allies.

British Prime Minister Gordon Brown added he was "disappointed" at the changing of rules in favor of U.S. aerospace giant Boeing, expected to win a multibillion-dollar contract to build an aerial refueling tanker plane for the U.S. Air Force.

"I admit that I did not appreciate this decision," Sarkozy said after talks with Brown. "These are methods which are not good for the partners of the United States, which is a great nation with which we are close and friends with."

Added Brown: "I too am disappointed about the American decision."

Boeing is poised to win the $35 billion (26 billion euro) contract to build the new refueling tanker for the U.S. Air Force after Northrop Grumman and European partner EADS dropped their joint offer.

European officials and EADS, which owns French-based plane maker Airbus, charged that the Pentagon altered bidding rules for the contract in order to favor Boeing's all-American offer over the European bid.

The European Commission has protested and a German minister has accused the United States of protectionism, warning that Berlin will take up the issue at the political level and at the World Trade Organization.

[Unicorn]

Some of the arguments that the Boeing disciples are trotting out are frankly verging on the insane, such as the A330 not being able to fit on the ramps used by USAF tankers, despite the USAF using two different types, one of which, the KC-10, is of a similar size to the A330.

One 'interesting' one was that the A330 uses side stick controllers, which none of the USAFs current large aircraft (AWACS, TACAMO, JSTARS, C130, C5 or C17) use, so for compatibility's sake' they should pick the KC-767 cause its like all the other Boeing aircraft in the inventory. Kind of ignores the fact that the USAF's F16 and F22 fleet use them and that it's been found to be a better, more intuitive control mechanism by most of the world's commercial pilots (which is why Boeing is using them on the 787).

Another is that they have plenty of C17s, so why do they need the capability to haul cargo too?

Yet another is that the ability to offload the same fuel fraction as a KC-767 at a significantly greater range from the tanker's base is not needed because tankers "don't travel far from their bases on refueling sorties anyway"

The one I like though is that if they picked the A330 instead of the 'all American' 767 the French might veto some US operation and refuse to let the USAF use the A330s.

Truly this competition has become a logic free zone.

Unicorn

[buglerbilly]

I don't publish possibly 60% or more of the articles published elsewhere on this matter as they: -

- add ntohing to the discussion being a regurgitation of what has been more adequately discussed elsewhere.
- so Boeing fan boy orientated as to be incoherent, stupid, moronic, facile, illiterate, plain ridiculous or any combination thereof.
- ditto some of the Airbus fan boy commentary including a lot of (most?) National newspapers in the UK or Europe.

One wonders where considered discussion has gone sometimes..........

[Chunder]

I've been noticing how Leeham News and Comment has become inundated with more trolls lately than during the last contract fiasco.

The Airbus people are just as bad.

The one that I enjoyed most was that the A-330 was not unique to the U.S's requirements whereas the 767 was. I'm still waiting for a coherent response about what exactly difference given that they are to refuel the same aircraft from the same airbases, performing the same missions, with the same constraints. Logic free zone is being kind. For a service that likes predicting what may arise in the future and develop platforms to combat a possible threat they certainly like con straining competition options.

I wonder what the people concerned in the USN think about all of this whole cock up process.

[Marc 1]

One interesting point is the use of the 787 displays and cockpit layout. Could this be a pointer to the 787 being entered as the competitor for the KCY competition later in the decade? It would point toward an ability to cross train between the two types relatively simply - a possible advantage in the future competition?

[Unicorn]

More likely Boeing will bid a 777 based tanker for the KC10 replacement.

They will be busy building 787s for the civil customers that have been waiting (im)patiently for the aircraft for several years.

Unicorn

[Chunder]

Does anyone have details of the A-330 MRTT tanker selection process? I wouldn't mind seeing the difference between our requirements and the USAF's.

[Unicorn]

Not that I can post. All I can say is that the A330 MRTT outperformed the KC-767 on every criteria bar one, which was cost. The KC-767 was cheaper, but by a surprisingly small amount per aircraft.

I am led to believe that this is also true of the UK competition however I don't have any details of the other competitions.

Unicorn

[buglerbilly]

KC-X Sole-Source Contract Will Draw Scrutiny

Mar 16, 2010



By Amy Butler
Washington

Northrop Grumman’s decision not to bid for the U.S. Air Force’s KC-X aerial refueling tanker contract is being met with a private sigh of relief from Pentagon officials.

Another round of contentious competition has been averted. But the officials’ sigh is likely being followed by an uneasy gasp at the tough challenge of negotiating a sole-source deal with Boeing that could endure to 2027.

The Pentagon’s request for proposals (RFP) for the contract to build 179 tankers calls for bids to be submitted by May 10. Bryan Whitman, a Pentagon official, says, “We have an open competition underway and no decisions have been made to truncate the process.”

“I would be surprised if the Air Force did not stick to the schedule and ask Boeing to submit a full proposal as the starting point for discussions” about pricing, says David Berteau, a senior advisor at the Center for Strategic and International Studies. With only one bid, the Pentagon will forgo the 120 days originally set aside to review the proposals.

The next hurdle for the Air Force will be securing a fair price for Boeing 767-based tankers. The competition was designed to drive down the cost and lock it in with a fixed-price incentive-fee development contract and fixed-price production lots. Now the onus is on the Air Force to validate Boeing’s pricing and ensure good value. A congressional staffer notes that additional auditing and program management staff will be needed to validate pricing.

But resistance to a sole-source contract is not widespread in Congress. Lawmakers from Alabama, where Northrop Grumman and EADS were planning to modify and perform final assembly of their aircraft, were angry about the decision. Without Northrop Grumman willing to fight to compete, though, they have little grounds to pursue any action on the company’s behalf.

The decision was also met with cries of protectionism from some camps in Europe. French President Nicolas Sarkozy plans to address the matter with President Barack Obama during a visit next month.

Boeing officials say they were surprised at Northrop Grumman’s decision to pull out, and are proceeding as though competition remains. “There is a contract we have to win,” says Tim Keating, Boeing’s senior vice president of government operations. Boeing officials are still not providing many specifics on their proposed design, which will include the 787 digital cockpit and a new centerline boom. These are both new additions since the last 767-based bid.

Boeing plans to produce the tankers on the 767 line in Everett, Wash., applying lean techniques to nose-to-tail manufacturing in a “small area in the factory,” says Boeing spokesman Dan Beck. They would receive military modifications in Wichita, Kan. The company officials have not articulated how items protected by International Traffic and Arms Regulations will be introduced into production.

Thirty 767-300ER passenger models are on order for commercial customers and another 27 freighters have been booked; last year Boeing produced 13 767s. Based on this rate, the production line has about four years’ worth of work. Air Force production is expected to begin with Lot 1 of 7 aircraft in Fiscal 2013 and another 14 in Fiscal 2014, and it will likely be at a full rate of up to 15 aircraft by the time commercial 767 orders taper off.

Northrop Grumman/EADS was poised to propose an Airbus A330-200 for the $35-billion contract, but Northrop Grumman CEO Wes Bush announced his company would not bid because the Pentagon’s revised source-selection methodology for this KC-X—the last award was terminated after a Boeing protest turned up procurement missteps—“clearly favors the smaller tanker,” which is Boeing’s 767-based proposal. “Investing further resources to submit a bid would not be acting responsibly,” Bush says. He submitted formal notification to Pentagon acquisition chief Ashton Carter Mar. 8.

Wall Street largely applauded the decision as a smart risk-aversion strategy.

EADS CEO Louis Gallois says the company will not submit a bid on its own and ruled out the option of teaming with a new prime partner. However, company officials make clear that they were eager to bid with Northrop Grumman by their side. “Our partners at Northrop Grumman were very concerned with the fixed-price contract,” says EADS North America CEO Sean O’Keefe. “We were not as concerned.”

The partnership was forged more than five years ago with Northrop Grumman to leverage that company’s “near-peerless” reputation in systems integration, program management and government compliance processes. “We’re developing all of those capabilities, too,” O’Keefe says, noting that in the intervening time his company won its first prime Pentagon contract, to build UH-72 helicopters.

“We could not bring that to the equation alone,” O’Keefe says. But the partnership was a marriage of convenience: Northrop Grumman hoped for profit in a tanker business that was never core to its planning and EADS hoped for a win to justify building a U.S. commercial airliner final assembly plant. The no-bid decision is a bitter end barely two years after the team won the first KC-X competition.

“I don’t think we feel burned by anybody. It is more of a case of disappointment,” O’Keefe says. “Folks feel like they invested a lot of energy . . . and it is kind of hard to give it up.”

Termination talks continue with the Pentagon over the defunct February 2008 win of a $1.5-billion contract to build the KC-45A.

EADS officials are now assessing how to amend their U.S. growth goals, as the tanker was to account for a major organic spike in company growth. O’Keefe notes that 250 more UH-72s must still be delivered, and the company will compete for the Army’s Armed Aerial Scout competition. But the biggest opportunity for immediate growth will be through acquisitions. “We are looking at midcap companies and service industry kinds of opportunities that will help us really strengthen our hand in the aftermarket,” O’Keefe says. Gallois’s focus on maintaining the company’s access to cash will limit near-term options.

The Pentagon has averted a potentially thorny competition and protest process, but the Air Force has lost an opportunity to prove it has the prowess to navigate a truly complex competition. Its acquisition corps has been under pressure since the KC-X mistakes and similar problems in an earlier competition to select a Combat Search and Rescue-X helicopter. The service’s work on the tanker deal has not fully recovered since the procurement scandal involving leasing of Boeing 767 tankers after the 9/11 terrorist attacks when commercial customers dropped their orders.

“We are disappointed by Northrop’s decision not to submit a bid for the U.S. Air Force tanker replacement program,” Deputy Defense Secretary William Lynn said after Northrop Grumman’s announcement. “We strongly believe that the current competition is structured fairly and that both companies could compete effectively.”

When the final request for proposals was released Feb. 24, Lynn said the revised KC-X competition is the “flagship” example of the Pentagon’s acquisition reform efforts.

But with procurement spending expected to flatten and the number of major programs projected to taper off, Berteau says the likelihood of sole-source contracts is growing. The industrial base has consolidated and, in some cases, shrunken after the post-Cold War drawdown, leaving the Pentagon with only one source for some major systems, such as stealthy manned fighters and ships. “Given the future we have, it would be in [the department’s] interest to make sure they learn how to manage a situation where there is only one supplier.”

This includes handling the challenge of locking in fixed-pricing with a sole-source contractor. The KC-X is widely expected to be the largest aviation sole-source in Pentagon history. The RFP allows for two opportunities to adjust price, the first with Lot 3 in Fiscal 2014 and the second with Lot 6 in fiscal 2018.

However, fixed-priced deals are not as simple as they may seem, says Jacques Gansler, Pentagon acquisition chief from 1997-2001 who now holds the Roger C. Lipitz Chair in Public Policy and Private Enterprise at the University of Maryland. He notes that all contracts have a “changes clause” that allows for renegotiation if a change is made by the customer. On the F-111, Gansler says 394,000 changes were ordered. He notes that electronics are being updated every 18 months and a mission change, such as the need to refuel unmanned aircraft, will likely crop up.

With Michael Mecham in San Francisco.

Photo: EADS North America

[buglerbilly]

Ares

A Defense Technology Blog

Europe's Tanker Outrage and Could it Backfire?

Posted by Robert Wall at 3/17/2010 11:28 AM CDT

Ever since the Northrop Grumman/EADS team decided to opt out of the U.S. Air Force KC-X tanker competition, Europe has been aflame in complaints about perceived anti-competitive behavior in Washington.

So what is behind the outrage and the sustained high-level complaints?

Clearly, there is a good deal of understandable frustration in Europe. When Northrop Grumman/EADS got the nod to provide the A330 as the tanker, it was clearly a coup and having the award overturned on procedural issues was doubly painful. What’s more, and hardly surprisingly, much of Europe doesn’t understand U.S. defense contractual processes, so the GAO protest and the crafting of the new RFP in the way it occurred reeks of back-room deal making to the outsiders and aggrieved.

But there is clearly more to the vitriol coming out of Paris, Berlin and London: domestic politics. All three governments have huge domestic political problems they are trying to paper over.

Gordon Brown is fighting for his political survival in London in advance of the May general election. Nicolas Sarkozy’s domestic political agenda has stalled since the economic downturn set in and there is more attention in Paris on whom he and his wife are respectively sleeping with than any political issues. And in Berlin, Angela Merkel’s coalition government also is struggling to send out a coherent political message, with infighting between the coalition parties.

Nothing is more opportune, at such a time, than some good old fashioned America bashing. These days, no European politico is going to lose a vote for speaking ill of Washington.

When Europe still had a love-affair with then-candidate Obama, he called Europe out on the situation when he said: “in Europe, there is an anti-Americanism that is at once casual, but can also be insidious.” It was a comment that was notably ignored in Europe.

The question now becomes whether there is a risk to EADS and other European firms (many of whom are far further along in building their industrial footprint in the U.S. than EADS) that the political grandstanding will drag on too long and create a political backlash in the U.S.

EADS is playing the long-game in the U.S. which explains why EADS CEO Louis Gallois has been careful not to let his disappointment color the tenor of his discourse on KC-X. While quick to argue he’s got the better plane, he’s shied away from lobbing verbal hand grenades. EADS understands there are future competitions to come: the U.S. Army’s armed scout helicopter, the U.S. Air Force’s CVLSP helo program, and myriad others. That’s clearly not the calculus driving the company’s political backers.

[buglerbilly]

Ares

A Defense Technology Blog

Pentagon Willing To Allow EADS Time for KC-X Bid

Posted by Amy Butler at 3/18/2010 4:47 PM CDT

As EADS considers to be cagey about its options for possibly entering the USAF KC-X aerial refueler competition, the Pentagon signals an open mind.

Geoff Morrell, press secretary to Robert Gates, issued the following statement today in response to questions about the tanker RFP:

"The Department has received notification from EADS North America indicating possible interest in competing for the Air Force's KC-X Tanker and we would welcome that. Consistent with our commitment to conduct a fair and open competition, the Department invites proposals from all qualified contractors and, if necessary, we would consider a reasonable extension to the RFP deadline. That is not unusual. In fact, a few recent examples include BAMS, VH-71, Small Diameter Bomb (SDB) II, LOGCAP IV, LCS, LPD-17 Repair Services, and FMTV."

This comes after harsh claims of protectionism from European allies when EADS's prime contractor, Northrop Grumman, pulled out of the competition, claiming that the RFP was skewed toward the smaller Boeing 767 offering.

[Unicorn]

Russian Firm mulls bid on USAF tanker contract

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.

"UAC will publicly announce by Monday morning the signing of the joint venture agreement for the first of what is hoped to be many opportunities in the U.S.," says John Kirkland, a Los Angeles-based attorney representing UAC.

A Pentagon spokeswoman said, "the Department of Defense remains committed to a fair and open competition and welcomes proposals from all qualified offerors."

The Air Force's aerial tanker replacement program has been tangled in controversy since 2002, when the Pentagon planned to lease a fleet of new tankers from Boeing Co. That plan was revoked and in 2008, Northrop Grumman Corp. and its European partner, the European Aerospace Defence & Space Co., were awarded a contract to build the fleet using the Airbus A330 jetliner. Boeing successfully protested that award and the Pentagon restarted the process yet again last year.

On March 8, Northrop Grumman Corp. dropped out of the contest to bid for the contract, saying the latest requirements favored Boeing's smaller 767 entrant.

On Friday, EADS said it was seeking a three-month extension of the May 10 bidding deadline as it considered submitting a bid on its own. However, EADS has always faced pressure because it is a European firm bidding for one of the most costly U.S. defense contracts.

A bid from a Russian firm would likely face even harsher scrutiny and criticism from lawmakers. In addition, the Russian plane has never been considered a commercial success.

Only 17 Il-96 are currently in passenger service, and the plane has largely failed to find traction outside of Russia and its major trading partners as a long-range wide-body jet since it was introduced in 1993. Last August, citing lack of orders Russia canceled production of the passenger version of the Il-96.

ENDS

***

I would piss myself laughing if Boeing, after getting the competition changed to a lowest bidder wins, find the Russians submitting a bid that is compliant with the USAFs requirements and that is an order of magnitude cheaper than the KC-767.

Talk about be careful what you wish for....

[buglerbilly]

Yeah I read this one earlier, pretty bizarre in my opinion and ZERO chance of succeeding but the nervousness it could put into Boeing is worth every rouble spent..................

[Chunder]

I'd Piss myself laughing if the Russians Protest to the GAO only to be upheld. USAF - "But we know it aint any good" GAO "Sorry they meet all your criteria" USAF - Too bad we are going with the 767. EADS -"Hang on a sec, in 2008 you said..."

What is a realistic in service entry Date for the Boeing proposal? ~ 6 Years for the first airframe? 2016-17 at the earliest? KC-Y just about to get underway?

[Deks]

Yep, but KC-Y deliveries aren't currently forecast to start until 2024. I would have thought they'd be able to do it faster what with KC-767 airframes being out there now, but with the changes they're talking about making then who knows.

It would be very disappointing if they weren't in service by 2016.

[Weasel]

Yeah I read this one earlier, pretty bizarre in my opinion and ZERO chance of succeeding but the nervousness it could put into Boeing is worth every rouble spent..................

no, its chance of succeeding is between 22% and 28%. Congress is POed with being raped by defense contractors. If that sentiment gains momentum then it is a positive vector for a low $ entry. The one large negative going against them is being Russian, but that negative vector will be reduced by a genuine and sincere partner in the new START treaty in April 2010. Now we are up to the 38% probability range. Considering 60% is basically the optimum that you can get from internal management, that makes them a legitimate dark horse.

Boeing on the other hand I would rate at slightly less then 50%, because of their perceived (and IMHO real) industrial clusterness maximus. No one has forgotten the bungled FCS program, least of all our good friends in the GAO.

cheers

w

[Unicorn]

Apparently they are seeking a US prime, with Lockheed Martin mentioned.

***

"We've always been clear that this is a fair and open competition and we welcome all qualified bidders," said Geoff Morell, a Pentagon spokesman.

According to a source familiar with the situation, UAC will propose a tanker version of its Ilyushin IL-96.

The plane, which would be called the IL-98, is roughly the same size as the 767-based tanker proposed by Boeing but with operating costs in line with the Boeing KC-135 tankers currently used by the air force.

The tanker would be built in Russia and assembled in the U.S. southeastern regoin, the source said.

ENDS

***

Some tools on US based forums are saying a bid by Russia is more welcome than a bid by EADS.

I swear this competition has become a logic free zone.

[Weasel]

Some tools on US based forums are saying a bid by Russia is more welcome than a bid by EADS.

I swear this competition has become a logic free zone.

Normally, that sort of behavior stems from children brought up in a patriachal family who also have a big sister. They grow up, go into the DoD, retire or whatever. But in doing so are silk screened with this overlay that France is USA's big sister. (???)

just my observations on that.

Have not heard anything about LM being in on the deal

cheers

w

[buglerbilly]

This is from the Seattle Times aka Boeing Country hence the bias.............

'Bizarre' tanker twist: Russians will bid against Boeing for Air Force contract

Russia's government-owned aerospace company United Aircraft will announce Monday it is competing against Boeing for the $40 billion refueling-tanker contract, a Los Angeles attorney for the company said Friday.

By Rami Grunbaum

Seattle Times deputy business editor

Here's the latest twist in the Air Force tanker saga: The Russians are coming.

Russia's government-owned aerospace company will announce Monday it is competing against Boeing for the $40 billion refueling-tanker contract, a Los Angeles attorney for the company said Friday.

United Aircraft of Moscow plans to unveil a U.S. partner and offer a modified version of its Ilyushin Il-96 wide-body plane, said John Kirkland, a Los Angeles lawyer representing the group.

The still-unidentified partner, "a U.S. public company and existing defense contractor," would assemble the planes in the U.S., he said. The Russian interest in the tanker bid was first reported Friday by The Wall Street Journal.

United Aircraft was formed under the authority of then-President Vladimir Putin in 2006 to combine the most famous names in Russian aviation: Sukhoi, Tupolev, Ilyushin, MiG.

Kirkland acknowledged it faces "significant hurdles ... there are obvious security issues, there are sanctions and restrictions on buying things from Russia."

He insisted, however, that "the Il-96 meets every single one of the final RFP (request for proposal) requirements, and it comes in at a lower price (than Boeing), so if it's a fair competition, we win."

One leading U.S. aerospace analyst thinks otherwise.

"What a completely bizarre idea," said Richard Aboulafia of the Teal Group.

"There would be enormous political, technical and performance barriers. It will not happen."

For one thing, Aboulafia said, "The Il-96's operating economics have more in common with the KC-135's than with the Airbus and Boeing jets scheduled to replace the KC-135s."

Kirkland said that might be true of the current Ilyushin Il-96, which uses four engines. But United Aircraft will pitch a tanker using two modern, fuel-efficient Western engines, he said.

"That's a great idea, if the Air Force enjoys taking on much more risk and if they delay the program a few years," Aboulafia responded.

"Just when I thought (the tanker competition) couldn't get any dumber this comes along," he added.

On another front in the tanker contest, European manufacturer EADS said Friday it was asking the Pentagon for a 90-day extension of the bidding deadline so it can decide whether to proceed without its partner Northrop Grumman.

Northrop was scheduled to assemble EADS's Airbus A330 tankers in a new plant in Mobile, Ala. But it dropped out March 8, saying the contract requirements tilted in Boeing's favor by emphasizing price over additional capabilities.

Kirkland said that "if Airbus doesn't bid, we'll step into their shoes" and consider using the Mobile, Ala., site.

The Ilyushin Il-96 first flew in 1988 as the Soviet Union began to crumble. Only 20 were sold before the passenger version was discontinued amid economic chaos at home and little interest abroad. Russian civilian aircraft, to the extent they are known in the West, are often considered lumbering and unreliable.

But Kirkland said they are sturdy, noting they have ferried U.S. troops into Afghanistan. United Aircraft makes the refueling tanker for Russia's air forces, based on the Ilyushin Il-76 airliner, and would convert its newer airliner in similar fashion, he said.

He attributed the mechanical problems of Russian airliners to lack of access to proper maintenance and training — something that could be corrected if United Aircraft can establish a maintenance, repair and overhaul base (MRO) in the U.S., he said.

"The whole economic incentive to do this transaction is we will have an MRO facility in the U.S., to allow us to service Russian airplanes to eliminate the maintenance problems people experience with Russian airplanes."

That in turn would open the door for United Aircraft to market its Antonov AN148 regional jet, for up to about 85 passengers, in the U.S. market.

"Its Putin's favorite plane," Kirkland said, adding that because of the AN148's low price, "Everyone should want it, they're just worried about the maintenance."

He said his Russian clients told him that when President Obama met Putin, the Russian president specifically asked about United Aircraft's potential bid on the tanker.

"Obama gave him his personal assurance they would be given a fair shot at this like everyone else," he said.

Rami Grunbaum: rgrunbaum@seattletimes.com or 206-464-8541

[Chunder]

Yeah, speaking of that risk thing. Isn't structuring a competition for a replacement to be fulfilled by a proposed variation which relies on shouldering a significant proportion of the development burden on the manufacturer that has not been built yet- carry risk for the airforce, and still likely to result in delays?

It's worth keeping these people in a database the closer the KC-X encroaches on KC-Y...

[buglerbilly]

'The Most American Plane'

Russian Firm Joins EADS, Boeing in Tanker Fray

By DEFENSE NEWS STAFF

Published: 22 March 2010

U.S. tanker competition that appeared to be headed for a sole-source contract award ballooned into a potential three-way contest as two new bidders indicated intentions to compete and the Pentagon opened the door to delaying the bidding deadline.


Russian Contender: The United Aircraft Corp. bid would be based on the Ilyushin Il-96, a UAC lawyer said. (DMITRY A. MOTTL)

On March 17, EADS declared that it might bid solo for the multibillion-dollar, 179-plane contract.

Two days later, United Aircraft Corp. (UAC), a Russian state-owned aerospace group, announced plans to bid for the tanker contract with an unnamed U.S. partner.

A lawyer for UAC, John Kirkland, said the Russian offering would be an "Il-98 tanker," a modified version of the Ilyushin Il-96 four-engine, wide-body airliner. He said the Il-98 would include more American-made parts than even the 767-based tanker to be bid by Boeing, which had until recently seemed to be the last contender standing.

"The Il-98 will be the most American plane in the competition," Kirkland predicted. "The Boeing plane, with all of its non-U.S. parts, will be the foreign tanker."

Moreover, he said, UAC was prepared to assemble the planes in Mobile, Ala., where EADS had pledged to build a new facility, and from whose congressional delegation the European firm had garnered much political support.

If EADS decided to press on with its bid, UAC has already held "preliminary talks with all of the states EADS initially reached out to" about assembly plants, he said.

Kirkland also said UAC would propose building a maintenance, repair and overhaul facility for the Il-98 tankers "so the Air Force would not have to go to Moscow to get spare parts."

Asked whether UAC's partner was a major defense firm, Kirkland said "no," declining further comment.

He said Russian officials hoped to discuss the nascent bid with U.S. Secretary of State Hillary Clinton before she departed Moscow on March 19 after two-days of talks.

DoD spokeswoman Cheryl Irwin said, "We welcome all qualified bidders." Asked whether the Russian firm was qualified, she said, "I don't know."

Analysts reacted to the Russian entry with shock and skepticism.

Richard Aboulafia, an analyst at the Fairfax, Va.-based Teal Group, called the move "pure political theater," and said the state-owned Russian firm could not capture the contract.

"If the U.S. Air Force wasn't happy with moving into the 21st century, this is the easiest way to remain with the KC-135's economics," Aboulafia said. The modified Il-96 would "certainly bring more weight per payload" than Boeing's 767-based offering or EADS' A330-based plane.

What's more, he said, modifying the Russian plane would require years more work than the other two.

Loren Thompson of the Arlington, Va.-based Lexington Institute said the development officially signals "silly season has come to the tanker competition."

Thompson added he doubts "any bid from a Russian firm would be viable enough to move very far in this competition."

Solo EADS?

Meanwhile, EADS is counting on international pressure and a Republican resurgence in this fall's U.S. elections to buoy its chances as a solo bidder, say analysts on both sides of the Atlantic.

"EADS is a political company," said Loïc Tribot La Spiere, chief executive of think tank Centre d'Etude et Prospective Stratégique. "It is playing the only card left: the political card."

French President Nicolas Sarkozy and German Chancellor Angela Merkel have already raised the political temperature by accusing the United States of protectionism. Sarkozy is to arrive in Washington on March 30 for talks with President Barack Obama that are likely to involve the tanker.

EADS has asked for a 90-day extension, which would push the mid-May bidding deadline into August, Pentagon officials said.

EADS spokesman Guy Hicks said the company has not yet decided to bid for the tanker award.

"DoD has welcomed our participation in the tanker competition," Hicks said. "EADS North America has demonstrated its ability to be a prime contractor" - for example, in the U.S. Army's UH-72A Lakota helicopter program - "and we feel a deep sense of responsibility and commitment to the U.S. war fighter, to the taxpayer and the communities where we do business in the United States. We have the most capable system. We have never lost to Boeing in a tanker competition."

Observers said the firm was seeking to delay the award until after the American midterm congressional elections in November. Republicans are expected to eat into the Democratic majority in both houses and possibly take back the House.

Powerful Republican members - including Sens. John McCain, R-Ariz., Richard Shelby, R-Ala., and Jeff Sessions, R-Ala. - steadily advanced Northrop and Airbus in the last competition, which the companies won in February 2008. Northrop and EADS promised to assemble and integrate Airbus-based tankers in nonunionized Alabama. Democrats, in contrast, were more supportive of Boeing and its large unionized work force.

EADS signaled a new interest in bidding several days after its partner Northrop Grumman withdrew and accused the Pentagon of favoring Boeing's smaller 767 tanker over EADS-Northrop's A330-based plane. In a letter the week of March 8, EADS executives asked Pentagon officials whether they would consider extending the deadline; the following day, U.S. Department of Defense officials said they were open to the idea.

EADS executives added that even if they get more time, they want the terms of the contest changed.

Sources said there was heated internal debate early last week between EADS executives and officials from its North American wing over whether to bid. Airbus Military Managing Director Domingo Urena-Roso and EADS North America CEO Sean O'Keefe wanted to go ahead with the bid, but EADS CEO Louis Gallois, with the backing of his company's executive committee, was reluctant, sources said.

Pentagon officials staunchly insist they have crafted a fair competition.

But DoD has an incentive to keep EADS in the running - to avoid a sole-source award to Boeing, whose executives have said they will bid regardless of the competition.

If the bidding deadline is delayed until August, the Pentagon won't be able to make a decision until after the November elections, Thompson said.

"EADS seems to be calculating that it would be more likely to get the changes it desires to the RfP if Republicans controlled at least one chamber of Congress," Thompson said. "And there is a possibility that Republicans will take over at least the lower chamber, and possibly also the U.S. Senate this fall."

Political Plays

One EADS North America source said if the European firm bids, its proposal will retain plans to assemble the A330s in Mobile.

"That community has a lot going for it," the source said. "The community made a commitment to us, and we feel strongly about living up to our side of the deal."

Sessions is doubtless counting on it. The Alabama senator urged the Pentagon to extend the "bidding window" to "allow it to fulfill its congressional mandate for competition" and avoid "another sole-source contract," which he said in the past has led to "higher costs and less capability."

Pro-Boeing lawmakers quickly panned the proposed extension.

"The Air Force laid out clear requirements and timelines, and Boeing and America's workers are ready to work to meet them," Sen. Patty Murray, D-Wash., said in a statement. "Holding the door open to an illegally subsidized foreign company is the wrong move for our men and women in uniform, workers and economy."

Following the later-overturned 2008 KC-X award to EADS and Northrop, defense analysts said the trans-Atlantic team had politicked just enough to tilt the contest.

Murray zeroed in on that tactic, saying the European firm was at that game again. "Unfortunately, this is typical of Airbus, who has continually worked to extend deadlines and change the rules in the middle of the game," she said.

A U.S. partner would have provided some political cover for buying a tanker based on a European airliner. But by taking on prime contractorship, EADS would force U.S. officials to contemplate the idea directly. EADS still needs a U.S. partner to handle classified equipment that would be fitted to its tankers.

And they would find it unthinkable, said Jean-Paul Hébert, defense specialist at the Ecole des Hautes Etudes en Sciences Sociales. A win with Northrop Grumman was unlikely, but a solo victory for EADS "would be a complete turning upside down of the trans-Atlantic defense market," Hébert said.

Moreover, analysts said, EADS is already hard-pressed to manage its tricky and sometimes troubled A380 superjumbo, A400M military airlifter and upcoming A350 airliner. Financially, EADS is trying to hold onto its 9.8 billion euro ($13.3 billion) cash hoard to maintain its credit rating and to weather the commercial aviation downturn.

"If you look at their financial outlook, it's extremely delicate for the future," Aboulafia said. "They don't have a lot of margin for error to bring the A350 to market. The A400 is, of course, a major area of concern, and the A380 is just an ongoing cash hemorrhage. I don't think they've got the financial flexibility to heavily discount their way into this market."

For example, EADS recently signed a financing deal with the seven NATO member customers for its A400M to patch a 5.2 billion euro cost overrun on that program. In New York on March 18, CEO Louis Gallois said EADS is trying to cut costs on its A380 even as it doubles annual production to 20 planes this year.

But Tribot La Spiere said EADS has the financial, engineering and industrial means to handle KC-X alone.

"EADS has the same capabilities as Boeing," he said. "It can find the resources needed."

Charles Armitage, the London director of defense aerospace consulting group CRA International, was similarly sanguine, at least about the engineering side.

"Work on other key Airbus programs like the A400M, A380 and A350 are at different phases of their life," Armitage said. "Airbus has already developed an A330 multirole tanker for Australia and others, but the resources question can't be answered without knowing how close the specification of those aircraft are to the U.S. requirement." ■
---
John T. Bennett, Vago Muradian, Antonie Boessenkool and John Reed in Washington, Pierre Tran in Paris and Andrew Chuter in London contributed to this report.

[buglerbilly]

Russia’s United Aircraft Chief Fyodorov Denies U.S. Tanker Bid

By Gopal Ratnam and Lyubov Pronina

March 22 (Bloomberg) -- Russia’s United Aircraft Corp. isn’t planning to bid for the Pentagon’s $35 billion Air Force aerial-refueling tanker program, Chief Executive Officer Alexei Fyodorov said, contradicting U.S. media reports.

The Wall Street Journal reported March 19 that United Aircraft, the maker of Ilyushin transport planes, was preparing a bid to be announced as early as today. The Washington Post also wrote about the plan on March 20.

“This is utter nonsense,” Fyodorov said in a subsequent telephone interview with Bloomberg News. “UAC is not planning to take part in the tanker tender or set up a joint venture.”

Both media reports cited John Kirkland, an attorney at Luce Forward in Los Angeles who said a venture would be announced between United Aircraft and a small, unidentified U.S. defense contractor on March 22 and that he represented the group.

CEO Fyodorov, in the Bloomberg interview, said he wasn’t familiar with Kirkland. United Aircraft is Russia’s state- controlled holding company for airplane production.

“Either it’s all a huge misunderstanding” or a matter of the Russians not wanting to confirm the plan “until something is officially announced,” Kirkland said in a March 21 interview with Bloomberg. “If I’ve been duped, it’s a massive conspiracy, but anything is possible.”

“I’ve spoken with lots of people on the Russian side” including from United Aircraft, Kirkland said, adding that he was told Russian Prime Minister Vladimir Putin had approved the plan to bid. “That’s consistent with what I’ve been told for the last six months,” he said.

Clinton Visit

Putin spokesman Dmitry Peskov said by telephone that he was unaware of any plans by United Aircraft to bid. The same was true of a U.S. State Department spokesman.

“To my knowledge there was no discussion of a Russian company bidding for the Pentagon tanker contract” during U.S. Secretary of State Hillary Clinton’s visit to Moscow last week, department spokesman Philip Crowley said on March 21.

Crowley said he was present in Clinton’s meetings. During the talks, “Russian leaders expressed an interest in a joint cargo aircraft project, but it was not specific,” he said.

The U.S. Department of Defense is seeking bidders to build a fleet of aerial refueling tankers, replacing aircraft that have been in service since the mid-1950s. Boeing Co. this month was left as the only bidder after Northrop Grumman Corp. pulled out of a team that included European Aeronautic, Defence & Space Co., which currently is mulling whether to bid on its own.

Pentagon spokesman Geoff Morrell said in a March 19 e-mail that the Department of Defense welcomed all “qualified bidders” to compete for the contract.

To contact the reporters on this story: Gopal Ratnam in Washington at gratnam1@bloomberg.net; Lyubov Pronina in Moscow at lpronina@bloomberg.net;

Last Updated: March 21, 2010 19:00 EDT

[Unicorn]

Yes, just saw this.

What a shame, I was looking forward to Boeing's discomfort.

[Weasel]

Yes, just saw this.

What a shame, I was looking forward to Boeing's discomfort.

So you a have a lawyer who one would assume, needs to maintain his reputation to draw business, make a statement to the Wallstreet Journal, that is days later contradicted by the very same people the lawyer says he is representing...?

Anyone want to buy a Flanker? Or do any business with the Russians?

lol

cheers

w

[buglerbilly]

It gets better...............

Firm Backs Lawyer at Center of Latest Tanker Controversy

By JOHN T. BENNETT

Published: 22 Mar 2010 20:03

A California-based law firm publicly backed one of its partners on March 22, saying John Kirkland had "for months" been working with a Russian firm about bidding for a multibillion-dollar U.S. Air Force aerial tanker contract.

The vote of confidence from Luce, Forward, Hamilton & Scripps came amid denials from Russian government officials and executives at United Aircraft Corp., that the state-owned firm, based in Moscow, would seek the 179-plane tanker deal.

The denials were prompted by American media accounts quoting Kirkland saying UAC and an unidentified U.S. defense contractor would soon announce a joint venture to pursue the contract.

In a March 22 statement, UAC officials denied knowing Kirkland, who the same day provided Defense News documents he says proves UAC and Russian officials had formally approved the deal. The documents state Russian President Dmitry Medvedev and Prime Minister Vladimir Putin approved the partnership in recent weeks.

Later in the day, Luce Forward, in a statement sent to Defense News by firm spokeswoman Rachel Lufkin, backed Kirkland.

"Luce Forward partner John Kirkland was engaged several months ago to negotiate a joint venture with Russia's United Aircraft Corporation," according to the statement. "The proposed joint venture, UAC America, Inc., planned to bid on American defense projects beginning with the U.S. Air Force tanker contract."

The statement also said Kirkland "was involved in multiple communications with high level individuals at both UAC and Russia's Federal Service of Military-Technical Cooperation regarding the proposed venture."

The firm said UAC executives, in "documented conversations and written communications," indicated the proposed joint venture had been approved and indicated "an agreement would be executed shortly."

Boeing is expected to bid for the tanker contract, and its European rival, EADS, is mulling whether it will bid.

[Weasel]

It gets better...............

Firm Backs Lawyer at Center of Latest Tanker Controversy

By JOHN T. BENNETT

Published: 22 Mar 2010 20:03

A California-based law firm publicly backed one of its partners on March 22, saying John Kirkland had "for months" been working with a Russian firm about bidding for a multibillion-dollar U.S. Air Force aerial tanker contract.

The vote of confidence from Luce, Forward, Hamilton & Scripps came amid denials from Russian government officials and executives at United Aircraft Corp., that the state-owned firm, based in Moscow, would seek the 179-plane tanker deal.

The denials were prompted by American media accounts quoting Kirkland saying UAC and an unidentified U.S. defense contractor would soon announce a joint venture to pursue the contract.

In a March 22 statement, UAC officials denied knowing Kirkland, who the same day provided Defense News documents he says proves UAC and Russian officials had formally approved the deal. The documents state Russian President Dmitry Medvedev and Prime Minister Vladimir Putin approved the partnership in recent weeks.

Later in the day, Luce Forward, in a statement sent to Defense News by firm spokeswoman Rachel Lufkin, backed Kirkland.

"Luce Forward partner John Kirkland was engaged several months ago to negotiate a joint venture with Russia's United Aircraft Corporation," according to the statement. "The proposed joint venture, UAC America, Inc., planned to bid on American defense projects beginning with the U.S. Air Force tanker contract."

The statement also said Kirkland "was involved in multiple communications with high level individuals at both UAC and Russia's Federal Service of Military-Technical Cooperation regarding the proposed venture."

The firm said UAC executives, in "documented conversations and written communications," indicated the proposed joint venture had been approved and indicated "an agreement would be executed shortly."

Boeing is expected to bid for the tanker contract, and its European rival, EADS, is mulling whether it will bid.

[big cheesey grin] See, the thing is, that Russia has just shot themselves in the foot. First they have a failed A-400 replacement talks with the Germans and now this. Not to mention the ongoing saga that the poor Indians have to deal with, re boats and things.

love it. :beaver

cheers

w

[buglerbilly]

Tanker Hopeful EADS Sent DoD Letter: Gates

By JOHN REED

Published: 25 Mar 2010 17:44

U.S. Defense Secretary Robert Gates told lawmakers during a Senate Appropriations defense subcommittee hearing March 25 that he was just informed he has received a letter from EADS. Gates said he was expecting the company to request additional time to put together a bid in the $35 billion KC-X tanker competition.

Gates said he has not made a decision on the matter, but he told the senators that he would not change the requirements the Air Force has set for its new tanker.

Sen. Sam Brownback, R-Kan., urged Gates not to grant EADS extra time to put together a bid.

"This thing has gone on long enough," said Brownback, in whose state Boeing, EADS' rival in the in the KC-X contest, would perform some of the work in building tankers.

If granted, this extension would be intended to give EADS and its subsidiary Airbus time to put together a bid as prime contractor for the deal. This comes after Northrop Grumman, EADS' former partner and U.S. prime contractor in KC-X, announced earlier this month that it would not bid in the contest. Northrop complained that the Air Force's requirements favored Boeing's smaller 767-based bid.

EADS officials could not immediately be reached for comment.

[buglerbilly]

Statement by the Head of UAC – Civil Aircraft

(Source: United Aircraft Corp.; issued March 29, 2010)

In addition to the Clarification on Media Reports About KC-X tanker, issued on 22 March 2010, the United Aircraft Corporation has to make the following statement:

Electronic mails sent by John Kirkland, a partner of Luce Forward (Luce Forward Hamilton & Scripps LLP) to news agencies, other media, various governmental and industrial organizations contain copies of forgery documents, made on a mockery of UAC blanks, and falsified letter exchange.

Vladimir Smolko, General director of the Control Company “UAC – Civil Aircraft”, whose mockery signatures were put on the falsified documents, made the following statement:

“A UAC’s branch, the Control Company “UAC – Civil Aircraft” headed by me, does not hold negotiations on delivery of the Ilyushin Il-96-400T aircraft to the United States of America. Persons who try to picture themselves as representatives of prominent US-based companies, had, on several occasions, tried to establish business contacts with officials of UAC and UAC - Civil Aircraft, but their attempts met no support from our side. I consider these attempts as a provocation”.

-ends-

[buglerbilly]

EADS Nears KC-X Decision

Mar 30, 2010

By Jens Flottau

FRANKFURT and LONDON — EADS plans to decide whether it will bid for the U.S. Air Force’s tanker within the next two weeks, Airbus CEO Thomas Enders told Aviation Week. But at this stage, Enders is “still skeptical” if EADS should go ahead with a bid.

Enders says that “we will not submit a dumping offer,” pointing out that the billion euros in cost overruns in the Airbus A400M program leaves the company less financial room to maneuver. But he hopes to negotiate a package with a U.S. defense electronics supplier that is more favorable than the Northrop Grumman proposal.

Views are split within EADS over the wisdom of moving forward given the wording of the current request for proposals (RFP). The Pentagon has held out the prospect of giving EADS more time to submit a bid, something EADS CEO Louis Gallois has indicated would be a prerequisite. However, the U.S. Defense Department has turned a cold shoulder to the idea of modifying the current RFP. EADS officials have been vague about whether an RFP change is required for them to consider making a prime contractor offer.

Northrop is said to have built significant profit margin into the former tanker offering because it was not core to its strategy and relatively small in terms of its overall volume. If EADS North America managed tonegotiate a supplier deal significantly below that, it could very well have a chance to come close to the Boeing offer in terms of pricing, Enders says, making it difficult for the Pentagon to discount the EADS offer.

Boeing officials have said they are still preparing their proposal, including pricing data, assuming they will face competition.

One industry official suggests an EADS announcement could come this week. Enders did not disclose which U.S. supplier EADS is talking to about forming a teaming relationship. But industry sources say Raytheon or L3 Communications are much more likely options than Lockheed Martin; Lockheed Martin and EADS were in talks several years ago about teaming for the U.S. Navy maritime patrol program that led to the Boeing P-8A, but the trans-Atlantic discussions faltered before a bid was submitted. As EADS canvasses the U.S. marketplace, even BAE Systems North America is being named by industry officials as a potential partner. BAE Systems is already much further established in the U.S. than EADS.

A U.S. team member is seen as important to handle some of the systems integration needs associated with the tanker program. However, an industry official says that EADS could meet Buy America rules in terms of U.S. content on the A330-based offering even without an American partner.

[buglerbilly]

Delivering Multi-Role Tanker Aircraft Capability

(Source: UK National Audit Office; issued March 30, 2010)



Britain’s £10.5 billion fleet of Future Strategic Tanker Aircraft will enter service five years late and will not achieve value for money, according to the National Audit Office. (AirTanker photo)The National Audit Office has been unable to conclude that the Ministry of Defence has achieved value for money from the procurement phase of its £10.5 billion private finance deal for the Future Strategic Tanker Aircraft (FSTA), according to a report released today.

Despite managing the later stages of the procurement well, the MOD's ability to get the best deal it could was undermined by shortcomings in the way it conducted the procurement and assessed alternative options. Although the project to provide air-to-air refuelling and military transport aircraft has achieved its delivery milestones since contract signature, it is still likely to be delivered five and a half years later than planned.

The MOD began the planning process with the assumption that the FSTA project would be delivered using a private finance deal, and therefore "off-balance sheet". This assumption was driven by affordability pressures and the prevailing policy to use PFI wherever possible. The selection of a PFI option was made without a sound evaluation of alternative procurement routes to justify why the PFI route offered the best value for money.

The original requirement for FSTA did not envisage the aircraft flying into high threat environments such as Afghanistan. When the need for possible additional aircraft protection measures arose, the Department sensibly did not alter its requirement for fear of prejudicing ongoing commercial negotiations. Having established that these modifications are likely to cost several hundred million pounds, the MOD is considering the costs and technical requirements. Even if MOD were to choose to go ahead with the relevant modifications, they would not be available for a number of years.

The MOD will pay on average £390 million per annum for the core FSTA service, which includes use of the aircraft and related services and infrastructure. However, the MOD also has responsibilities to support the effective delivery of the service and ensure that it obtains value for money from the contract. Any significant delay to the planned redevelopment of the main operating base at RAF Brize Norton, scheduled for shortly after FSTA’s entry into service, would affect the smooth operation of the service.

Given the delay to FSTA, the MOD is being forced to rely on ageing and increasingly unreliable Tristar and VC10 aircraft to provide air-to-air refuelling and air transport to Afghanistan. While the MOD has been successful in fulfilling these priority roles, flying hours across both fleets have reduced by 21 per cent since 2002-03. To assist in delivering its air transport requirements the MOD also charters passenger aircraft, at a cost of approximately £175 million between 2006-07 and 2008-09.

Mr Amyas Morse, head of the National Audit Office, said today:

"Shortcomings in the early stages of the project put the MOD in a position where the operational pressures of an aging fleet and the need to maintain the vital air bridge restricted its ability to deliver a solution which achieved value for money.

"Despite taking five years longer than planned to sign a contract, the MOD's progress in delivering the Future Strategic Tanker Aircraft project has improved since contract signature, and the project is meeting its delivery milestones. But there is more work for the MOD and its suppliers to do to get the best out of the deal."

The Comptroller and Auditor General, Amyas Morse, is the head of the National Audit Office which employs some 900 staff. He and the NAO are totally independent of Government. He certifies the accounts of all Government departments and a wide range of other public sector bodies; and he has statutory authority to report to Parliament on the economy, efficiency and effectiveness with which departments and other bodies have used their resources.

Click here for the full report (42 pages) on the NAO website.

http://www.nao.org.uk/idoc.ashx?docId=aff8d3db-1de8-403e-a653-811de16bc395&version=-1

-ends-

[buglerbilly]

Future Strategic Tanker Aircraft Makes Good Progress Towards Introduction to Service

(Source: Air Tanker; issued March 29, 2010)

CARTERTON, UK --- As we move closer towards the Introduction To Service of the Future Strategic Tanker Aircraft (FSTA) late next year, all major milestones for the development of the FSTA service by AirTanker Services (ATrS) have been met since the Contract was signed two years ago.

This important programme will provide the RAF with a safe, reliable and efficient air transport and air-to-air refuelling service over 24 years, using 14 new, specially converted A330-200 aircraft.

ATrS is responsible for developing and delivering the support elements of the service such as the infrastructure, maintenance, training, ground and flight operations, which are all progressing well. Two years after the FSTA Contract was signed (27 March 2008), the programme remains on schedule and preparation continues for the delivery of the first aircraft to the Royal Air Force (RAF) next year.

Construction of the new, state-of-the-art Main Operating Base at RAF Brize Norton continues to plan and will finish early next year. The exterior work on the modern two-bay hangar and support building was completed at the end of last year and the interior fit out is well underway. Building work on the training centre is also moving on rapidly with the first milestone completed seven weeks ahead of schedule (on 10 March 2010) in spite of the adverse weather conditions at the beginning of the year.

ATrS has also focused efforts on building a highly experienced and capable team to deliver the FSTA service. Recruitment will continue at pace throughout this year and next as ATrS looks to find the first Sponsored Reservist pilots and to increase the engineering and ground operations teams. Once fully operational, the FSTA service will employ around 500 personnel with a 60:40 split between military and civilian.

Another key priority is the work towards gaining relevant licences and approvals to enable the service to operate. This involves developing the right processes and procedures to meet military and civil aviation requirements, ensuring that the service is safe and compliant.

The aircraft development programme - run by Airbus Military – is also making good progress. In July 2009, the first A330-200 aircraft was delivered from the Airbus assembly line in Toulouse to the FSTA prototype conversion facility in Getafe, near Madrid (the second aircraft followed shortly afterwards). Conversion work is well underway and as of 25 February 2010, both aircraft were back on wheels with the first phase of activity complete. Further conversion and testing will now take place before the first test flight in military configuration is scheduled for later this year.

Talking about the progress made so far, Dave Mitchard, Managing Director of ATrS, said:

“FSTA is an ambitious programme with many elements needing to come together in order to create a safe, efficient and reliable air transport and air to air refuelling service for the RAF. Two years on from Contract signature, I am delighted that the programme remains on track and I am confident that we will continue to meet the milestones set for the coming year.

“I would like to take this opportunity to thank all those involved in making this happen so far – from ATrS staff and sub-contractors through to the MOD’s Project Team and RAF personnel at Brize Norton and beyond. It is down to a lot of hard work, enthusiasm and commitment to deliver results from all concerned, which has been supported by the strong partnerships that have developed over the last two years.

“This programme is about combining best practice from civil aviation with RAF operational expertise and military ethos to create a most efficient and effective service solution for the RAF. At ATrS, our vision is to be recognised as the best service provider to the RAF and I believe that getting the development and planning work right now will go a long way towards to helping achieve this.”

BACKGROUND NOTES

AirTanker Services Ltd was created in 2008 to deliver the FSTA service to the UK Ministry of Defence, which will provide the Royal Air Force with a reliable, safe and efficient Air Transport (AT) and Air-to-Air Refuelling (AAR) service over 24 years.

The FSTA service will use 14 new, specially converted, state-of-the-art A330-200 aircraft, each of which will be capable of carrying passengers with associated freight or aero medical patients in addition to its AAR role. As well as reducing overall running costs and significantly improving reliability, the aircraft will have considerably less impact on the environment than its predecessors. The first aircraft is due to be delivered in late 2011.

The FSTA programme covers all aspects of an integrated aircraft service, ranging from the provision of the infrastructure, a full flight crew and engineer training service, through to aircraft maintenance, despatch and ground support. It will combine best practice from civil aviation with RAF operational expertise and military ethos to create a most efficient and effective operational solution for the RAF.

The FSTA service will be provided by AirTanker Services under fixed pricing arrangements with clear performance indicators. The MOD will only pay for the service once it is available and then only for the capacity that it uses, subject to agreed minimum usage levels.

AirTanker Services is contracted to operate the service from AirTanker Ltd, who hold the Contract from the MOD. AirTanker Services has five shareholders, who are also primary sub-contractors for the programme. They are: EADS (aircraft manufacture and initial conversion); Cobham (refuelling equipment and aircraft conversion); Rolls-Royce (engine assembly, support and project management); Thales UK (mission simulators, defensive aids, avionics and mission planning systems); and VT Group (infrastructure and communications/information systems, design, build and support, and certain elements of technical support to the aircraft).

-ends-

[buglerbilly]

EADS Must Prove Commitment To Gain Tanker Bid Extension

By john reed

Published: 30 Mar 2010 12:15

EADS must prove that it is serious about bidding on the U.S. Air Force's $35 billion KC-X competition before the Pentagon grants the European defense giant a "modest extension" to the May 10 deadline for responding to the request for proposals.


The Pentagon believes a true competition would be best for the taxpayer, U.S. Air Force Chief of Staff Gen. Norton Schwartz says. (SCOTT M. ASH / US. AIR FORCE)

"Is EADS serious about putting together a proposal? ... If they are, [the Air Force] will think about granting EADS "a modest extension," said U.S. Air Force Chief of Staff Gen. Norton Schwartz during an Air Force Association-sponsored breakfast March 30.

The Pentagon believes a true competition would be best for the taxpayer, Schwartz said, before reiterating his earlier statement that EADS must be serious about bidding as a prime contractor.

He added that the modest extension would not affect the performance of the current fleet of KC-135R Stratotankers that KC-X will one day replace.

His comments come nearly one week after Defense Secretary Robert Gates told lawmakers that he had received a letter from EADS seeking extra time to respond to the RfP so the company could put together a solo bid after its former partner and U.S. prime contractor, Northrop Grumman, announced early this month that it would not bid.

EADS has confirmed that it sent a letter seeking a 90-day extension to the May 10 RfP response date.

Late last week, Tom Enders, CEO of EADS subsidiary Airbus, said that the company will make a decision to bid within the next two to three weeks.

"Though there has been no decision by EADS to bid, we appreciate the Department of Defense's expressed commitment to competition," reads a March 30 e-mail from EADS North America spokesman James Darcy. "We are continuing to evaluate our options. An extension of the RFP deadline is essential, but not the only factor in making a decision."

U.S. Partner

One of the biggest challenges facing EADS officials is finding a U.S. partner capable of assembling their Airbus A330-based tanker at a stateside plant. The European company is also taking massive financial hits with its troubled A380, A400M and A350 programs, something that could factor in its decision to put together an aggressively priced bid to compete against rival Boeing's 767-based offering.

Schwartz also said the U.S. Air Force is angling to take the lead in the command and control of the nation's missile defense systems.

While the U.S. Army and Navy operate the majority of the surface-to-air missiles used for missile defense, the air service wants its air component commanders around the globe to have command and control of those assets in their theaters of operation. However, the other services are also vying for control of the nation's missile defenses and the issue will "have to be decided in the tank," said Schwartz, referring to the Pentagon's conference room for the Joint Chiefs of Staff.

The general also touched on the latest developments in the Air Force's effort to field a new long-range strike platform sometime in the coming decade or two, saying that the service is working to convince the Pentagon within the next year of the service's need for a long-range strike system that is somewhere "between an F-35 and a conventional ballistic missile."

Whatever system emerges will likely be based off existing technology and will fit into the Pentagon's planned family of strike systems that was mandated in the 2010 Quadrennial Defense Review. The system will be "affordable and appropriate" and not laden with costly "wishful" technologies and capabilities, added Schwartz.

[buglerbilly]

Sarkozy Supports Tanker Competition Structuring

By JOHN REED

Published: 30 Mar 2010 17:53

U.S. President Barack Obama and French President Nicolas Sarkozy publicly threw their support behind the Pentagon's structuring of the $35 billion KC-X tanker competition on March 30.


President Barack Obama listens as French President Nicolas Sarkozy speaks during a joint press conference in the East Room of the White House in Washington on March 30. (Jewel Samad / AFP)

Speaking during a joint news conference in Washington, Sarkozy told reporters that he trusts Obama's assurances that any competition between Boeing's 767-based tanker and European defense giant EADS' Airbus A330-based bid will be "free and fair."

"If you say to me that the competition will be free and fair and transparent, then we say EADS will bid and we trust you," he said.

Obama followed up by reaffirming the U.S. commitment to a "free and fair" competition, adding that France's "trust is justified."

Obama also told reporters that he has no intention of usurping Defense Secretary Robert Gates' control over the competition.

"The Secretary of Defense makes procurement decisions. The president does not meddle in these decisions and that's a long-standing policy, so I maintain an arms-length approach. I have assurances from Secretary of Defense Gates that, in fact, the rebidding process is going to be completely transparent and completely open and a fair competition," he said.

[buglerbilly]

EADS, Airbus Military to Highlight In-Flight Refueling Capabilities at 2010 ARSAG Conference

(Source: EADS North America; issued March 30, 2010)

ARLINGTON, VA --- EADS' air-to-air refueling expertise will be a focus of this week's Aerial Refueling Systems Advisory Group (ARSAG) conference, which will include updates on the Airbus Military A330 Multi-Role Tanker Transport (MRTT).

The annual ARSAG meeting -- March 30 to April 1 in Orlando, Fla. -- will bring together representatives from U.S. military services and 14 other nations to discuss aerial refueling issues from the operational, safety, training, reliability and maintainability points of view.

Airbus Military will provide three presentations on the A330 MRTT, beginning today with a briefing on the capabilities it is providing for the Royal Australian Air Force. Presentations on April 1 will focus on systems design and flight-test achievements. The MRTT has refueled a range of aircraft -- from F-16 and F/A-18 fighters to the E-3 AWACS -- using its Advanced Aerial Refueling Boom and its hose-and-drogue refueling pods, and recently achieved an important certification milestone with the European Aviation Safety Agency (EASA).

The A330 MRTT has won all recent international competitions for military tanker aircraft, with 28 aircraft ordered by Australia, the United Kingdom, Saudi Arabia and the United Arab Emirates. The Royal Australian Air Force will become the initial operator, receiving the first of its five multi-role tanker transports later this year.

Airbus Military representatives also will be available to discuss the A400M, the world's most technologically advanced and versatile airlifter and aerial refueler. With its large cargo box and four 11,000-shaft-horsepower turboprop engines, the A400M can carry the outsized, heavier equipment needed by today's fighting forces over strategic distances into short, unprepared fields. In its tactical tanker role, it can refuel fighters, helicopters and larger aircraft at those receivers' preferred speeds and altitudes. The A400M made its first flight in December 2009, and has logged more than 40 hours of successful flight test.

EADS North America and Airbus Military will be displaying their capabilities in the ARSAG exhibition hall at Stand #24.

-ends-

[buglerbilly]

Ares

A Defense Technology Blog

USAF KC-X Bid Deadline Extended 60 Days

Posted by Michael Bruno at 3/31/2010 4:21 PM CDT

The Pentagon will extend the deadline for bids for the USAF KC-X to July 9, another 60 days for industry to prepare proposals.

The move comes as EADS has leaked its interest in bidding for the beleaguered aerial refueling tanker program against Boeing.

“We consider 60 days to be reasonable in this case,” Pentagon spokesman Geoff Morrell just told reporters there. The Air Force will compress its bid evaluation period, so it can still award a contract this fall as planned.

Morrell said such an extension would not come without serious expectation of dueling bids. Separately, one industry consultant told Aviation Week this week that EADS officials were busy preparing a bid.

AvWeek's Amy Butler was at the Pentagon and will report more on the Aviation Week Intelligence Network Web site shortly.

Update 5:45 p.m. eastern: Sen. Patty Murray (D-Wash.) is not amused, but Sen. Richard Shelby (R-Ala.) said it was right on.

"This is completely unacceptable," Murray said minutes after the press briefing ended. "This extension means that we are once again bending the rules for a company that has refused to play by them. Holding the door open to an illegally-subsidized foreign company is the wrong move for our men and women in uniform, our workers, and our economy."

Shelby praised the Pentagon. "A sole-sourced contract would have served only Boeing's interests," he said. "The presence of a competitor better serves the interest of our warfighters and American taxpayers. It is my hope that EADS will be able to offer a competitive bid, despite the fact that the RFP has been skewed toward Boeing from the beginning."

[buglerbilly]

Ares

A Defense Technology Blog

Did Pentagon Strengthen 'No-Bid' KC-X Camp Inside EADS?

Posted by Robert Wall at 4/1/2010 3:58 AM CDT

When the Pentagon yesterday announced it would consider a 60 day extension to the KC-X tanker bid deadline if EADS expresses serious intent to bid, perhaps the most important point made by Pentagon spokesman Geoff Morrell was the following:

“No one should confuse our willingness to extend the bid deadline with willingness to change any of the plane's military requirements or the way bids will be evaluated.”

That makes the calculation for EADS whether to bid a lot harder. Not only has the Pentagon not given the company the 90 days it was hoping for, it also has dashed hopes the RFP would be changed. While the chances of that happening were slight all along, EADS clearly was hanging on to hope they might and had indicated they would be looking for some relief.

What’s more, when Northrop Grumman, EADS’s former partner on the KC-X program pulled out of the running, the European aerospace company supported the move and CEO Louis Gallois said ““we will not compete because the RFP is based on a smaller, less capable airplane.” In the aftermath, he has been a bit less clear about that point, though.

According to EADS officials, company executives are split on whether to bid on KC-X. Preparations are underway, but there are skeptics. It is hard to believe the shorter timeline offered by the Pentagon would be a material reason for EADS not to bid, but yesterday’s pronouncement may strengthen the hand of the “no-bid” camp.

[buglerbilly]

EADS ‘Will Bid,’ Sarkozy Says

By Colin Clark Tuesday, March 30th, 2010 9:58 pm

French President Nicolas Sarkozy said today that the Franco-European defense giant EADS “will bid” on the tanker contract after receiving assurances from President Obama that the competition will be “free and fair.”

And in what looks like a clear signal to EADS that the Pentagon will seriously consider opening the bid to EADS, the Air Force Chief of Staff told my colleague Andrea Shalal-Esa of Reuters that, “they have to say they’re serious and then the department will decide how much time to allow.” He spoke to Andrea at an event hosted by Air Force Association.

“If you say to me that the competition will be free and fair and transparent, then we say EADS will bid and we trust you,” Sarkozy said at a joint White House press conference. Obama said that Sarkozy’s “trust is justified.”

And, just in case anyone wondered whether Obama was stepping on Defense Secretary Robert Gates’ procurement toes with his declaration, the president made it clear he was not.

“The Secretary of Defense makes procurement decisions. The president does not meddle in these decisions and that’s a long-standing policy, so I maintain an arms-length approach. I have assurances from Secretary of Defense Gates that, in fact, the rebidding process is going to be completely transparent and completely open and a fair competition,” Obama said.

Obama’s declaration comes after major European leaders blasted the United States for being protectionist after Northrop Grumman dropped its bid for the KC-X tanker. Even Britain’s Gordon Brown said at the time that he was “disappointed.” The administration, keenly aware of the importance of its allies’ help in Afghanistan, clearly decided to make the nicest noises possible during Sarkozy’s visit.

The question to be answered — after EADS decides whether to bid or not — is whether EADS North America will place the bid or the company will look for a large American partner like Lockheed or another larger company like Raytheon. I’m skeptical that Lockheed would take the political risk of aligning itself with EADS on this program (but not on the A400M). Any other American company would also have to grapple with the prospect of angering Rep. Norm Dicks, chairman of the House Appropriations defense subcommittee, and a host of other powerful lawmakers. Whether EADS North America would be sufficient political cover for EADS is open to question.

Read more: DoD Buzz | EADS ‘Will Bid,’ Sarkozy Says

http://www.dodbuzz.com/2010/03/30/eads-will-bid-sarkozy-says/#axzz0jr89zwP8

The comments attached to this post at DoD Buzz are disturbing in both their rampant stupidity and gross paranoia. They display an ignorance of Real Politik bordering on idiocy. Unfortunately with Dicks like DICK around you are NOT going to get anything better.....................I detest Politicians at the best of times but I sure could wander into hatred for some of these clowns.

[buglerbilly]

Boeing to study its options for tanker contract

By JOSHUA FREED (AP) – 7 hours ago

MINNEAPOLIS — Boeing said on Thursday that it is reviewing its options for bidding on a $35 billion contract to make Air Force tanker planes.

At the moment, Boeing Co. is the only announced bidder for what is expected to be a 179-plane order. But on Wednesday the Pentagon said it might extend the May 10 bidding deadline by two months to give European competitor EADS a chance to re-enter the process.

EADS and former partner Northrop Grumman pulled out of the bidding for the long-awaited contract last month.

Boeing, based in Chicago, said it is prepared to bid by May 10, but will "review all of our options for going forward" while waiting for a final decision on the deadline. A Boeing spokesman declined to say whether the company means it will bid later, or is considering not bidding at all, or some other possibility.

Defense analyst Loren Thompson of the Lexington Institute thinks he knows what Boeing means.

"If it feels that anything is being done to advantage its competitor, it will file a protest or take other legal action," Thompson said.

He predicted that EADS will not bid. Northrop Grumman Corp. pulled out because it felt that the bidding process was tilted toward Boeing, and that process hasn't changed, Thompson said.

EADS and other critics of the Pentagon's bidding process have said the terms appeared designed to favor a smaller jet offered by Boeing.

In its statement on Thursday, Boeing accused EADS of trying to delay the tanker program and shift the bidding process in its favor.

"We do not see a legitimate reason for EADS's bid deadline extension request, and we believe an extension that favors any individual competitor does not further the goal of ensuring fair competition," Boeing said.

EADS has said that a 90-day extension was the minimum it needed to prepare a bid. It said it would consider the Pentagon's offer of a 60-day extension.

"We understand the time-sensitivity of this process, and we're moving forward quickly, but we're moving forward in a deliberate way that will allow us to make the decision to bid or not," EADS North America spokesman Guy Hicks said.

Boeing shares rose 38 cents to close at $72.99.

Copyright © 2010 The Associated Press. All rights reserved.

[buglerbilly]

EADS Talking With L-3 as Potential KC-X Supplier

By JOHN REED

Published: 6 Apr 2010 15:06

EADS North America is talking with L-3 Communications about a potential role as a "key supplier" if the European defense giant bids for the U.S. Air Force's $35 billion KC-X contract.


EADS has not yet decided whether to bid its A330 Multi-Role Tanker Transport in the competition to replace the aging U.S. Air Force KC-135. (AGENCE FRANCE-PRESSE)

The European company "will hopefully be working" with L-3's mission integration group on a "major program," according to an April 6 company e-mail. A copy was obtained by Defense News.

A company source confirmed that the two companies are discussing L-3's potential participation as a "key supplier" if EADS bids for the KC-X contract.

EADS has not yet decided whether to bid, the source said.

When asked about the e-mail, EADS spokesman James Darcy said, "There's been no decision by EADS to bid; however, if we go forward as a prime [contractor], we'll look to build a strong U.S.-based supplier chain."

The European company asked the Pentagon last month for a 90-day extension in the response time to the KC-X request for proposals to put together a bid as the prime contractor after EADS' former U.S. partner - and prime contractor - Northrop Grumman announced that it would not bid on the contract in early March.

Last week, the Pentagon announced that it is willing to grant EADS a 60-day extension from the May 10 deadline if the firm will confirm its intent to bid.

Among the many things EADS' North American division will have to do in order to serve as the prime contractor is find a subcontractor with the ability to convert its Airbus A330 airliner-based offering into a military tanker, according to company sources.

At press time, L-3 officials had not immediately returned calls seeking comment.

[buglerbilly]

Boeing NewGen Tanker Win Would Benefit Florida

(Source: Boeing; issued April 6, 2010)

I wonder when they are going to offer free blowjobs for everyone that votes for them? IF they haven't already............:wingchung

TALLAHASSEE, Fla. --- The Boeing Company today announced that the state of Florida will benefit from an estimated 1,900 total jobs with 14 suppliers and generate an estimated $95 million annual economic impact if the Boeing NewGen Tanker is selected as the U.S. Air Force's next tanker aircraft.

The NewGen Tanker is a widebody, multi-mission aircraft based on the proven Boeing 767 commercial airplane and updated with the latest and most advanced technology. Capable of fulfilling the Air Force's needs for transport of fuel, cargo, passengers and patients, the combat-ready NewGen Tanker is being offered as a replacement for 179 KC-135 aircraft. Boeing is writing a proposal to meet or exceed the 372 mandatory requirements described in the service's final KC-X Request for Proposal released on Feb. 24. The Air Force is expected to award a contract later this year.

"During these challenging economic times, the citizens of Florida value any opportunity to work in high-tech jobs," said Mark Wilson, president of the Florida Chamber of Commerce. "Our state is proud to be part of Boeing's NewGen Tanker team and looks forward to the NewGen's selection as the next air refueling aircraft for America."

Florida manufacturers ready to produce critical components on the NewGen Tanker include:

-- Vought Aircraft, Stuart -- doors, wing center sections, aft wheel well bulkheads, crown and side fittings
-- Goodrich Lighting Systems, Oldsmar -- interior lighting products
-- Pall Aeropower, New Port Richey -- filtration products
-- Parker Fluid Systems, Naples -- propulsion, hydraulic and fuel components
-- Radiant Power Corp., Sarasota -- electrical components and batteries.

"With unemployment rates across the state topping 12 percent, awarding the U.S. Air Force Tanker contract to Boeing will ensure that hundreds of hardworking, skilled Floridians have well-paying, meaningful jobs," said Frank Ortis, mayor of Pembroke Pines, Fla., and president of the Florida State Council of Machinists and the Broward County AFL-CIO.

The NewGen Tanker will be made with a low-risk approach to manufacturing that relies on existing Boeing facilities in Washington State and Kansas as well as U.S. suppliers throughout the nation, with decades of experience delivering dependable military tanker and derivative aircraft. Nationwide, the NewGen Tanker program will support approximately 50,000 total U.S. jobs with Boeing and more than 800 suppliers in more than 40 states.

The Boeing NewGen Tanker will also be more cost-effective to own and operate than a larger, heavier tanker. It will save American taxpayers more than $10 billion in fuel costs over its 40-year service life because it burns 24 percent less fuel than the competitor's airplane.

Boeing has been designing, building, modifying and supporting tankers for decades. These include the KC-135 that will be replaced in the KC-X competition, and the KC-10 fleet. The company also has delivered four KC-767Js to the Japan Air Self-Defense Force and is on contract to deliver four KC-767s to the Italian Air Force. Three of the four Italian tankers are in flight test, with the fourth airplane in production.

A unit of The Boeing Company, Boeing Defense, Space & Security is one of the world's largest defense, space and security businesses specializing in innovative and capabilities-driven customer solutions, and the world's largest and most versatile manufacturer of military aircraft. Headquartered in St. Louis, Boeing Defense, Space & Security is a $34 billion business with 68,000 employees worldwide.

-ends-

[buglerbilly]

U.S. Senators Urge Gates Not to Give EADS Extension on KC-X

By JOHN REED

Published: 7 Apr 2010 17:44

Five U.S. senators today told Defense Secretary Robert Gates they believe that granting EADS a 60-day extension to put together a bid for the KC-X competition would amount to putting "American service members and workers on hold to accommodate the business needs of an illegally subsidized company."

In a May 7 letter to Gates, senators from districts with a heavy Boeing presence urged the Pentagon chief to stick to the original May 10 deadline for responses to the KC-X request for proposals.

"The Air Force has already laid out clear requirements and timelines for the KC-X competition, and the potential bidders have already had ample time to study the final Request for Proposals and prepare competitive bids," the lawmakers wrote. "We see no valid reason to postpone the tanker acquisition process any longer."

The letter's authors are Sens. Patty Murray, D-Wash.; Kit Bond, R-Mo., Sam Brownback, R-Kan.; Pat Roberts, R-Kan.; and Debbie Stabenow, D-Mich.

On March 31, the Defense Department announced that it would grant EADS an extension of 60 days to respond to the RfP if the company formally commits to bidding. Pentagon press Secretary Geoff Morrell said at the time that the DoD would consider shortening its evaluation period for the bids in order to grant a contract award in early fall.

EADS officials have said they need an additional 90 days to review classified portions of the RfP they were not shown when their former KC-X partner Northrop Grumman was serving as their prime contractor in the U.S. for their previous bids. EADS officials must also receive "training" on how to present their proposal to the Pentagon.

Perhaps most importantly, EADS must find a U.S.-based defense contractor that can convert its A330-based bid into a military tanker. Yesterday, an EADS source revealed that the company was in talks with L-3 communications about the performing key integration work on the aircraft.

Last month, the European defense giant announced it is considering bidding as the prime contractor following Northrop's exit from the contest in early March. Northrop pulled out of the contest claiming that the cost-focused RfP favored Boeing's smaller 767-based tanker over the larger EADS jet which is based on a newer design.

The senators' letter goes on to accuse EADS of receiving billions in government subsidies give it an "illegitimate handicap over" Boeing. The lawmakers say that EADS is using "illegally subsidized aircraft" to increase its presence in the U.S. market.

The senators are citing a recent World Trade Organization ruling that said EADS received unfair subsidies to cover the startup costs of some of its airplanes. The Pentagon has long maintained that the WTO ruling will not affect the KC-X competition.

[buglerbilly]

Side efforts NOT directly related to just KC-X.................

KC-135 Testing Aims at Fueling Efficiency, Cost Savings

(Source: U.S Air Force; issued April 12, 2010)

EDWARDS AIR FORCE BASE, Calif. --- Engineers at the Air Force Flight Test Center here are testing a system known as the Automatic Receiver Aircraft Identification, or ARAI. Currently installed on a test aerial refueler, if the tests are successful, they say, the system will significantly improve air-to-air refueling.

The ARAI is designed to be installed on a KC-135 Stratotanker to make the air-to-air refueling to a receiver aircraft more efficient and economical. Phase 2 testing for the ARAI has begun here, which included a flight test April 7 using an NKC-135 test tanker equipped with ARAI and an F-16 Fighting Falcon equipped with radio frequency identification, or RFID, tags. The NKC-135 will use its ARAI antennas to scan the F-16 for recognition and to accurately gauge the amount of fuel transferred.

"It's an inventory control measure similar to what the large department stores have," said Steve Walden, AFFTC test operations project manager. "It's a similar process to when you walk through the passive system at the door, the tags on the backs of CDs and DVDs are automatically inventoried. That is ARAI in the tanker, fly-up inventory control."

Currently, when an airplane approaches a KC-135 for fuel, the receiver aircraft's information is manually tracked by the boom operator. Information for the receiver plane, such as tail number and squadron, must either be visually identified or communicated by radio. During night operations and radio silence situations, doing this can be complicated.

"(ARAI) helps clean up the process so the boomer can focus on what's really important, refueling the aircraft and completing the mission, rather than administrative tasks," said Karen Etzkorn, a Boeing systems engineer and principal investigator.

Ms. Etzkorn added that when visual identification and communications are hindered for some reason, it takes longer for the KC-135 crew to accurately log the aircraft and fuel information after the refueling process is finished, or sometimes after they land.

Manually entered information can be inaccurate and thus costly. With the ARAI/RFID system, a receiver aircraft with the RFID tags can be scanned by the ARAI and all data retrieved is logged into a computer aboard the tanker. Accurate information is important because when an aircraft is refueled by a KC-135, the receiver's squadron is responsible for the fuel cost.

"There's millions of dollars lost every year because of tracking for fuels that are unaccounted for or allocated incorrectly," Mr. Walden said. "When you go into a certain situation when there's no communication (between the two aircraft), you have to estimate and that's when you could lose money."

Mr. Walden said the ARAI system could potentially save the Air Force money by accurately tracking the amount of fuel downloaded and charging squadrons the proper dollar amount. Air Force officials would be able to budget their fuel needs and costs more efficiently.

The Phase 2 KC-135 ARAI testing is part of the 'proof of concept' portion of the testing process, which includes aerial testing. Once Phase 2 is complete, the testing results and data will be forwarded to Air Force Materiel Command officials for review.

-ends-

Northrop Grumman Navigation Capabilities Successfully Tested in Support of Automated Aerial Refueling Program

(Source: Northrop Grumman Corp.; issued April 12, 2010)

WOODLAND HILLS, Calif. --- Northrop Grumman Corporation's navigation products exceeded data collection and characterization test objectives and provided excellent robust performance during recent flight tests for the U.S. Air Force Research Laboratory's Automated Aerial Refueling (AAR) program in conjunction with the Air Force Flight Test Center's Test Operations Combined Test Force, the 190th Air Refueling Wing of the Kansas Air National Guard, and the Calspan Corporation.

The purpose of the AAR program is to develop the capability of refueling unmanned aircraft with the existing Air Force tanker fleet.

Employing a Learjet as a surrogate for an unmanned aircraft and a modified refueling tanker, Northrop Grumman's relative navigation software and LN-251 embedded global positioning system (GPS)/fiber-optic inertial navigation system (INS) provided the precise positioning information required in support of the simulated aerial refueling mission.

A series of 10 flight tests, which concluded on March 18, demonstrated that Northrop Grumman's relative navigation software could be successfully hosted in the LN-251. The test also exercised the LN-251's newly-added Ethernet interface as well as its embedded 24-channel GPS receiver with enhanced tracking capabilities.

"This flight test showed that our relative navigation solution can successfully support the AAR mission and can be utilized for future applications where moving vehicles must operate in close proximity to one another," said Dr. Charles Volk, vice president and chief technology officer for Northrop Grumman's Navigation Systems Division.

Northrop Grumman has been involved with the AAR program since its inception and has supplied hardware, program analyses and support for all flight tests. The recently tested improvements to the relative navigation system are designed to increase performance availability, continuity, integrity, and accuracy in all flight situations.

"The success of this flight test is especially notable because it demonstrates the ability of an embedded GPS/INS to host relative navigation processing," said Dr. Alex Fax, director of positioning, navigation and timing solutions at Northrop Grumman's Navigation Systems Division. "This redundant, INS-based architecture has been checked out in our Hardware-in-the-Loop facility and demonstrated in flight."

The LN-251 systems utilized for this demonstration are the smallest, lightest navigation-grade embedded GPS/INS units available. They contain a high-performance navigation-grade fiber-optic gyro-based inertial measurement unit, providing a compact and low noise precision navigation solution for the relative navigation applications. The LN-251, with its digital interface, is easy to incorporate into new aircraft and avionics systems of existing aircraft. Its modular open architecture supports additional applications and evolving requirements.

Northrop Grumman Corporation is a leading global security company whose 120,000 employees provide innovative systems, products, and solutions in aerospace, electronics, information systems, shipbuilding and technical services to government and commercial customers worldwide.

-ends-

[buglerbilly]

Still No Partner For EADS Tanker Bid

Apr 14, 2010



By Amy Butler

EADS North America’s plans to quickly secure a U.S.-based strategic partner for its prime contractor bid for the U.S. Air Force KC-135 replacement contract appear to be encountering significant headwind.

L-3 Communications has emerged as the front-runner. The company has robust work with the Pentagon and, in particular, is receiving accolades from the U.S. Air Force for its performance in delivering MC-12W Project Liberty intelligence collection aircraft on a tight schedule. The company would likely provide the ability for the team to install the sensitive defensive and communications systems onto the aircraft. However, multiple sources in industry suggest that L-3 has abruptly signaled waning interest in moving forward.

EADS officials said March 29 they would announce their plans for the KC-X bid within the next two weeks (which would have been by April 12). Yet, a company spokesman for the North America wing, Guy Hicks, says there has still been no decision on whether to bid. And he declined to discuss any talks with potential partners. Jennifer Barton, L-3 Communications spokeswoman, also would not discuss the status of negotiations.

Proposals are due by May 10. Pentagon officials have said they would allow for a 60-day extension if EADS signals a willingness to bid for the program, which is estimated to be worth $35 billion (Aerospace DAILY, April 2).

EADS North America had been the primary subcontractor for a proposal from Northrop Grumman to sell 179 A330-based tankers, but Northrop announced it was walking away from the deal in early March. Company CEO Wes Bush said the current request for proposals exposed the company to too much risk — both in winning (he said the RFP favored Boeing’s 767 proposal) and garnering revenue through the fixed-price contracting plan.

Dennis Muilenburg, president of Boeing Defense, Space and Security, says the Boeing 767 proposal will take advantage of the ability of Boeing Commercial Airplanes to build as much of the aircraft as possible on the production line. He said the production process would be modeled after the Navy P-8, which is largely built on the 737 production line. Muilenburg spoke to Aviation Week during an interview at the 26th National Space Symposium.

Photo: Northrop Grumman

[buglerbilly]

EADS scrambling as L-3 cool to tanker work-sources

* Seen needing partner given scope, complexity of work

By Andrea Shalal-Esa

It is not particularly in L3's interests to partake in this competition in my opinion...........

WASHINGTON, April 15 (Reuters) - Airbus parent EADS (EAD.PA) is working fast to seal a teaming agreement with another U.S. company after L-3 Communications Holdings Inc (LLL.N) backed away from joining its bid for a U.S. refueling plane deal that could be worth $50 billion, sources familiar with the situation said.

EADS officials had hoped to announce this week that they would challenge Boeing Co for the contract, along with the names of key suppliers, but its efforts to assemble a new team after Northrop Grumman Corp's (NOC.N) withdrawal last month have run into some difficulty.

One source closely following the issue said L-3 was "probably completely out" of the process at this point, although there was still a slight chance that the New York-based company could change its mind.

EADS officials are still in talks with some U.S. companies, including possibly L-3, Raytheon Co (RTN.N) and others, although time for hammering out a teaming agreement is beginning to grow tight, according to several sources who were not authorized to speak on the record.

The company hopes to make an announcement next week, according to sources following the issue.

Pentagon officials last month said they would extend the bid deadline by 60 days, if EADS made a firm commitment to compete, and said they expected a decision within a few weeks.

Lieutenant General Mark Shackelford, the top military officer in charge of acquisition for the Air Force, on Tuesday said EADS had not yet responded, but he expected to learn the company's decision within the next week.

EADS spokesman Guy Hicks said no decision had been made, and said the company continued to evaluate its options.

"EADS North America has made no decision to bid for the KC-X contract. If we elect to go forward, we will do so with a strong U.S. industrial team," he said, adding that the Pentagon's agreement to give EADS more time to prepare a bid was important, but not the only factor guiding the decision.

L-3 spokesman Jennifer Barton declined to comment.

Raytheon officials earlier this month said the company was not joining the EADS team, but could not be reached for further comment on Thursday. BAE Systems (BAES.L) had also ruled out joining EADS bid, according to sources familiar with the talks.

"POLITICALLY INCENDIARY SITUATION"

Scott Hamilton, aerospace analyst with Leeham Co, cited the high political drama surrounding the last competition, when Northrop was the prime contractor on the deal, and said EADS' potential suppliers had to weigh that against the possible gain if EADS once again beat out Boeing.

"Clearly this is a politically incendiary situation," he said, citing strong opposition among Boeing supporters to even the Pentagon's deadline extension. "Now that you have EADS out front and center on this thing, it's even more incendiary."

Any potential supplier, such as L-3, BAE Systems or Raytheon, could face "intense political pressure and intense congressional wrath," he said.

Several sources familiar with congressional concerns said Representative Norm Dicks, a strong Boeing supporter who just took over as chairman of the House Appropriations defense subcommittee, had taken a strong interest in the talks.

Dicks has close ties to U.S. defense companies, and talks often with key industry executives, they said.

One defense industry source, who asked not to be identified, said the political climate may have factored into Northrop's decision to withdraw from the competition. "The political pressures have an effect," said the source.

Northrop said the terms of the competition favored Boeing's smaller 767-based tanker, although Northrop and EADS supporters insist the A330-based tanker would give the U.S. Air Force more flexibility and range in carrying fuel, passengers and cargo.

Hamilton said EADS had a keen interest in finding a U.S. partner to do some classified work and integration work, not least given the complexity and scope of the order.

At issue are dozens of technical requirements in which another company may be able to provide more experience than the North American unit of EADS, whose largest U.S. military contract is for a less complicated helicopter.

EADS wants to avoid being disqualified from the competition for technical grounds, said Virginia-based defense consultant Jim McAleese. "Having someone... that is currently doing a significant volume of complex aircraft modification work with the Air Force is critical," he said.

"That goes directly to the heart of the pass/fail mission capability criteria," he said, adding that EADS would likely outsource about 15 percent of the total contract volume, about $3.3 billion a year, to integrate the mission equipment.

The question for the potential partner, he said, would be whether the resulting $400 million to $500 million in revenue would offset any political fallout from being associated with the highly controversial project.

Analysts say EADS likely has well over 100 people already working on a bid proposal, given the short time before the deadline -- even if it is extended until July 9. Typically such proposals can be 20,000 to 30,000 pages long when complete.

(Reporting by Andrea Shalal-Esa; Additional reporting by Tim Hepher in Paris; Editing by Tim Dobbyn) (andrea.shalal-esa@thomsonreuters.com; + 1 202 898 8400, washington.newsroom@thomsonreuters.com))

[buglerbilly]

Ares

A Defense Technology Blog

Tanked Up

Posted by Douglas Barrie at 4/20/2010 6:46 AM CDT



The flight test program required for certification of the Airbus A330 Multi Role Tanker Transport hose-and-drogue refueling system has been completed by Airbus Military.

The conclusion of the tests clears the way for the Spain’s national institute for aerospace technology (INTA) to certify the aircraft - for daylight refueling operations - during the course of the summer, according to Airbus. INTA is the military certification agency for the MRTT.

The A330 MRTT is fitted with the Cobham 905 hose-and-drogue refueling system. Flight testing of the Airbus Military Aerial Refueling Boom System (ARBS) goes on, with Airbus suggesting this will “be completed shortly.”

An Airbus A310 has also been used as a demonstrator in the development of the boom technology.

The Royal Australian Air Force is now scheduled to begin to take delivery of its five A330 MRTTs later this year, according to Airbus. The MRTT aircraft is also on order for the UK, Saudi Arabia, and the United Arab Emirates.

The A330 MRTT received civil supplemental type certification from the European Aviation Safety Agency in March.

Picture Credit Airbus Military

[Ecky]

Just released...

Source: Defense News (http://www.defensenews.com/story.php?i=4589799&c=AME&s=AIR)
By JOHN REED
Published: 20 Apr 2010 14:19


EADS North America will bid as a prime contractor in the U.S. Air Force's $35 billion KC-X tanker competition, officials from the European defense giant said April 20.

The company said it plans to submit a bid on July 9, taking advantage of the Pentagon's offer to delay bidding by two months to attract EADS to the contest. In the meantime, the company will continue seeking a U.S. partner on the program.

Boeing has already said it will bid for the contract to replace the Air Force's fleet of some 500 aging Boeing KC-135 aerial refueling aircraft.

EADS' announcement comes after more than a month of deliberation by the company after its erstwhile U.S. partner, Northrop Grumman, dropped out of the contest in early March, claiming the government's solicitation favored rival Boeing's smaller, 767-based offering over EADS-Northrop's Airbus A330-based design.

Since then, EADS has been scrambling to find its own team of U.S. suppliers capable of modifying the A330 into a military tanker as well as getting up to speed on details to the KC-X request for proposals (RfP) that had only been shared with former prime contractor Northrop and preparing to put together a formal response to the RfP.

On March 31, the Defense Department announced it would grant EADS an extension of 60 days to respond to the RfP if the company formally commits to bidding. This came after EADS sent the Pentagon a letter asking for a 90-day extension.

Pentagon Press Secretary Geoff Morrell said at the time the Defense Department would consider shortening its evaluation period for the bids to grant a contract award in early fall to remain consistent with the program's schedule.

The original response date for the RfP, which was issued Feb. 24, was May 10.

On April 6, it was revealed that the European company was in talks with L-3 to be a major supplier in a potential EADS KC-X bid

[Unicorn]

I wonder what is encouraging EADS to enter a contest stacked so obviously and blatantly against them.

The bidding process will cost millions, for no likely outcome.

I wonder what inducements have been made to EADS to continue to bid in a losing game?

[buglerbilly]

Ares

A Defense Technology Blog

Notable Anniversary: Druyun's Guilty Plea

Posted by Amy Butler at 4/20/2010 3:54 PM CDT

It was six years ago today that Darleen Druyun, a former procurement executive in the Air Force, plead guilty to illegal job talks with Boeing and showing bias to the company in exchange for a $250,000/year vice president job and employment for her daughter and future son-in-law.

She later served nine months in jail, had a $5,000 fine, served 150 hours of community service and had seven months of community confinement after release.

Former Boeing CFO Michael Sears was the only official at the company to go down as a result of the malfeasance. He served four months in jail, paid a $250,000 fine and 200 hours of community service.

But, six years later, the Air Force is still struggling with a recovery. The once so-called Dragonlady started a fire that the Air Force has yet to put out.


Druyun's former USAF bio pic

Her management style is described by the Government Accountability Office as "forceful." But, multiple sources (even those with stars on their shoulders and firsthand accounts) note that generals routinely quaked in their boots at a look from her through her characteristic thick glasses. She was also a notorious emasculator of industry execs.

But despite the Air Force's attempts to put the Druyun affair behind them, her legacy lingers. Several deals that she steered -- or tried to steer -- to Boeing still remain uncontracted and, more importantly, undelivered.

The most infamous is the KC-X. Druyun was at the heart of early talks for a high-cost deal to lease 767s for tankers from Boeing that sparked the ire of Sen. John McCain, who single-handedly dismantled the corrupt plan.

Today, on this notable anniversary, EADS North America announced it will propose its own prime contractor bid to build 179 KC-135 replacements. It will again compete against a Boeing 767 design. This is after the company won in 2008 under the wing of prime contractor Northrop Grumman. That contract, however, is being terminated after procurement missteps were found pursuant to a Boeing protest. Long story short -- USAF doesn't have a single new tanker. It does have money invested in a 767 demonstrator from the lease days. And, it owns part of an A330 from its first payment in the 2008 contract prior to termination. But, not a single NEW tanker.

Next, there is SDB, the 250-lb GPS-guided Small Diameter Bomb. Losing bidder Lockheed Martin protested Boeing's win of the SDB after Druyun's "indebtedness" to Boeing over its job offer to her came to light. And she admitted to steering this contract to Boeing. GAO found that Druyun had manipulated the source selection by deleting more challenging moving target requirements that were largely believed to favor Lockheed Martin's proposal.

Boeing's work on SDB I designed for fixed targets was already under way. But, GAO recommended a new competition for SDB II, the complex weapon that will kill moving targets in all types of weather using a sophisticated trimode seeker. The defense industrial complex being an incestuous group, Boeing and Lockheed Martin have jumped into bed together on a bid that is largely favored over that from underdog Raytheon. A downselect is expected at the end of the month.

Finally, there is C-130 AMP. Again, Lockheed Martin (in this case the original equipment manufacturer for the massive family of C-130 aircraft) lost to Boeing. And, so did BAE and L-3 Communications. After Druyun's guilty plea, all three piled on with a protest. And, this program is even less far along now than SDB II.

GAO found that Druyun served as the lead procurement official over this competition and presided in what GAO called "a forceful management style" over a meeting in 2000 later dubbed the Sept. 15 massacre. During this and subsequent meetings, Druyun etched away evaluation ratings to favor Boeing. Eventually, Boeing won.

Because about three years of work was already done on the design, the Air Force opted to allow Boeing to continue. The catch was that a competition would be conducted in Fiscal 2009 to build and install the design onto the C-130 fleet. Originally envisioned as a major standardized avionics upgrade for more than 500 C-130s, the program has now atrophied into a plan for only 221 aircraft. The program has suffered major delays and a Nunn McCurdy cost overrun. Upon seeing the problems, the special operations community, which needed the upgrade for its C-130 fleet, ran screaming and is pursuing its own solution.

Fast forward to now, and the Air Force has tried to kill or cut back the program on multiple occasions. Testing of the Boeing solution has been complete, but plans for a competition aren't yet solid. So, like tanker and SDB II, no new units are fielded.

The GAO published a concise review of these major issues in a 2005 report.

[buglerbilly]

EADS North America Launches Website Featuring the Only KC-X Tanker Entrant Flying Today

(Source: EADS North America; issued April 23, 2010)

ARLINGTON, VA --- EADS North America has launched a new website detailing why the American-made KC-45 aerial refueler is the clear choice to meet the U.S. Air Force's 21st Century tanker requirements. The new site features video and photography of the KC-45 tanker in flight conducting refueling operations, as well as facts and information about the aerial refueling system.

EADS North America announced this week it will offer its KC-45 for the Air Force's tanker modernization competition. The KC-45 is the only tanker in the competition that is in production and flying today.

If selected by the Air Force, the KC-45 will be built at a new production facility in Mobile, Alabama, and will be supported by more than 200 suppliers across the country. The facility also will build commercial freighters, creating or supporting tens of thousands of American jobs.

EADS North America's KC-45 is the U.S. military version of EADS' proven A330 Multi Role Tanker Transport (MRTT), which has been selected over Boeing tankers in five consecutive head-to-head competitions. To date, 28 of these aircraft have been ordered by U.S. allies around the world.

The A330 MRTT has transferred more than 265,000 lbs. of fuel to a range of military aircraft -- from F-16 and F/A-18 fighters to the E-3 AWACS -- using the same proven refueling systems offered on the KC-45.

EADS North America is the North American operation of EADS, a global leader in aerospace, defense and related services. As a leader in all sectors of defense and homeland security, EADS North America and its parent company, EADS, contribute over $11 billion to the U.S. economy annually and support more than 200,000 American jobs through its network of suppliers and services. Operating in 17 states, EADS North America offers a broad array of advanced solutions to its customers in the commercial, homeland security, aerospace and defense markets.


The new website is at www.kc-45now.com

-ends-

[buglerbilly]

DATE:26/04/10

SOURCE:Flight International

Comment: Will lightning strike twice for EADS?

Boeing, perhaps more than anyone, should be thankful its rival EADS decided to take one final shot at the KC-X tanker contract.

EADS's move guarantees the contract award will be decided by a competition, removing endless paperwork exercises required for keeping contractors with sole-source jobs honest. The question remains, however, whether EADS truly has a chance to win.

The air force has asked for a tanker with no more fuel capacity than the KC-135R, so the A330-derived KC-45 could receive no advantage for offering perhaps 20% more fuel than its competitor. Only under a price shoot-out, in which both bids come within a 1% spread, will the KC-45's arguably best feature receive any credit.

For this reason, Northrop Grumman decided to withdraw from the tanker competition, leaving former partner EADS with a difficult decision to make.

Of course, EADS doesn't have to win the KC-X contract to achieve some key objectives.

By heeding the Department of Defense's plea to submit an offer, EADS scores valuable points with the world's most important buyer of military aircraft.

By entering what could become a price shoot-out, EADS forces Boeing to accept greater risk and fewer rewards from winning a tanker bid.

And maybe EADS could get lucky. Remember, this is KC-X bidding. Stranger things have happened.

[buglerbilly]

Former Leader Of Air Mobility Command Joins EADS

By BRUCE ROLFSEN

Published: 26 Apr 2010 16:05

A former commander of Air Mobility Command has joined one of the two companies bidding to build the Air Force's new air refueling tanker.

Gen. Arthur Lichte, who officially retired in January, now sits on the board of directors of EADS North America. A division of European Aeronautic Defence and Space Co., EADS North American announced Lichte's confirmation to the board April 23.

EADS North America is vying with Boeing Co. to win the $35 billion contract, to be awarded sometime this fall. The tankers, 179 in all, will replace the service's aging KC-135 fleet.

"General Lichte's leadership experience in command positions at squadron, group and wing levels - as well as commander of the Air Mobility Command - will provide valuable perspectives ...," Ralph D. Crosby, EADS North America Chairman, said in a statement.

As head of AMC, from September 2007 until November 2009, Lichte called several times for a new tanker. The former KC-135 pilot, however, never mentioned which company should build the jets.

"I would be lying if I said I wasn't frustrated," Lichte told reporters in July about the KC-X delays.

Another former AMC commander, retired Gen. Tony Robertson, works as an executive for Boeing. He left the service in 2001.

[buglerbilly]

EADS, Boeing Squaring Off Again Over Tankers

Apr 27, 2010



By Amy Butler
Washington

With little to lose and much to gain, EADS is now pursuing a solo bid for the U.S. Air Force’s $35-billion KC-135 replacement program.

This path seemed virtually unthinkable a few months ago; however, a win would be the single most significant step in boosting the company’s revenue in the U.S., which is largely dependent on commercial sales.

Just six weeks after Northrop Grumman dropped out as prime contractor and following a series of failed negotiations attempting to secure another major U.S. partner, EADS announced that it will lead its own bid.

The company had been in talks with L-3 Communications and Raytheon to install specialized communications and defensive systems, though no agreements were reached. “The scope of work is not something we would typically do,” said L-3 CEO Michael Strianese. “The door is not closed, and we wish EADS well in the competition.”

EADS officials argue that their team includes 200 U.S.-based suppliers.

In a sense, this is the throw-down long desired by Ralph Crosby, the first CEO of EADS North America who now serves as chairman. As prime contractor, EADS will be able to call the shots, and this may be a private relief for company executives. The arrangement with Northrop Grumman to propose the Airbus A330-based tanker was always a marriage of convenience, and it ended abruptly with EADS lacking a cohesive team and with only a few months to submit a massive proposal to build 179 tankers. During previous KC-X contests, the tension was sometimes evident between Northrop, which lacked experience developing and selling tankers, and EADS, its primary subcontractor.

EADS would never have chosen to enter the fray as a prime after so many fits and starts and with only 11 weeks to assemble a bid. But the company finally has an opportunity to directly challenge Boeing in its own backyard and in the world’s largest defense market.

After losing Northrop Grumman as a prime, EADS could be better postured to compete with Boeing on price, which is a major determining factor in the forthcoming selection. Some industry sources suggest a prime contractor adds 10-15% on top of the cost of a proposal for management duties. However, now EADS will have to bear the cost to bid, which is likely to be above $100 million. Because the A330 is a larger aircraft than Boeing’s 767, price will be a difficult point for the company.

Northrop Grumman CEO Wes Bush says he abandoned KC-X because the fixed-price development and procurement profile would leave the winner little room for profit and the request for proposals favored the smaller Boeing aircraft.

However, Crosby and EADS North America CEO Sean O’Keefe say the strength of their proposal lies in the risk that has been reduced during the KC-X saga. EADS is now conducting flight trials of the first two Multirole Tanker Transports (MRTT) and the new refueling boom for Australia. “Our aircraft exists. It is flying,” Crosby said during an April 20 press conference. “The Air Force shouldn’t be forced to buy an aircraft that only exists on paper.” He is confident the fixed price proposed by EADS will be realistic based on the company’s experience thus far with the aircraft.

Boeing has released little detail on its 767 design. The aircraft will likely include structurally enhanced, larger wings as well as a 787 digital cockpit and a new design boom. However, a flying prototype does not exist. The challenge will be to build enough margin in its price to avoid cost overruns that could make this an unprofitable program, but to also come in under EADS’s pricing.

O’Keefe says his company is in a much stronger position to be a prime now than when it signed the earlier teaming agreement with Northrop Grumman. Northrop brought experience as a major U.S. defense contractor and systems integrator to the team. “Today, it is a different case,” says O’Keefe, adding that the company is prime contractor on the Army UH-72A light utility helicopter. “We do have systems integration capability.”

However, managing KC-X would be far more complex. Crosby has admitted that the Army’s requirements were serendipitously in line with the attributes of the commercial Eurocopter EC145 baseline model.

EADS also faces sjpeg political headwind here. One thorny issue will be how to handle critics who brand the A330 tanker as a European product that could rob Americans of much-needed jobs. The rhetorical volleys have already begun.

Sen. Jeff Sessions (R-Ala.)—whose home state is where EADS plans to assemble the tankers—claims that Rep. Norm Dicks (D-Wash.), House Defense Appropriations subcommittee chairman—whose home state is where the 767 is built—engaged in “political intimidation” to dissuade U.S. companies from joining the team. Geoff Morrell, Pentagon press secretary, however, says that “any company that is interested and qualified to participate in this important program should do so.” He says he does not want any U.S. company “to be left with the impression that it would be a mistake to partner with EADS” on the bid.

EADS still plans to assemble the tankers and A330 freighters in a new Mobile, Ala., facility if it wins. The maximum anticipated capacity is 44, roughly 15 per year of which would be for tankers. Although only 66 freighter orders have been secured, EADS is viewing the Mobile facility as capacity to handle future buys while the Toulouse plant will continue with its passenger aircraft assemblies. Mobile also could be a site for work on other aircraft, such as the Airbus A350 or a next-generation narrow-body transport.

Crosby says the company has not yet decided how many aircraft must first come off the assembly line in Toulouse and the modification facility in Getafe, Spain, before shifting operations stateside. Under the KC-X contract won in 2008 with Northrop Grumman, the sixth aircraft (the second production version) would have been the first to roll off the assembly line in Mobile (AW&ST March 3, 2008, p. 22). The company dashed plans to break ground on the first building there shortly after winning a $1.5-billion development contract when Boeing filed a protest. The Government Accountability Office later uncovered acquisition missteps that led to contract termination and a new contest.

Bids are now due by July 9, a 60-day extension from the earlier May date. The extra time was offered by the Pentagon if EADS entered the competition.

Photo: EADS North America

[buglerbilly]

Too Few Tankers For War



By Colin Clark Wednesday, April 28th, 2010 4:51 pm

1 in 5 Tankers Sit in Depots

The Air Force’s latest mobility study found the United States could not muster enough tankers to execute two of three likely scenarios, senior service officials told the House Armed Services air and land forces subcommittee today.

One of the principal reasons for that is that the aging tanker fleet needs so much patchwork and loving care that almost 20 percent of the fleet is in a depot at any one time, Brig. Gen. Michelle Johnson testified. “In two of three scenarios we did not have sufficient tankers,” she said. For the big one, two nearly simultaneous large land campaigns, with three attacks on the U.S. homeland, the U.S. needs 103 percent of what we have. For the second scenario, an air and naval campaign that places even greater stress on the tanker fleet, the shortfall was even greater: 120 percent of what we have, Johnson said.

Given that the Air Force, wants a new tanker and a better quality tanker as soon as possible, she told subcommittee chairman Rep. Adam Smith.

Moving up several levels, the Mobility Capabilities and Requirements Study (MCRS) changed and refined the Air Force’s estimate for what is needs for transport by examining for the first time ever the stresses inflicted by an irregular warfare scenario. “It is also the first in-depth look the department has conducted for mobility that informs both the stresses on the total force to sustain a long war and addresses from a mobility perspective the nation’s ability to surge for a second warfight under these conditions,” Johnson said in her prepared testimony. The third scenario took into account the absence of well equipped airstrips and resupply facilities.

But the new study also found that the U.S. already has enough air transport, even though Congress has locked in a figure of 316 transport planes as a minimum — based on the previous mobility study — the new one found the country can get by safely with somewhere between 274 and 304 aircraft. One of the major factors that resulted in a lower number was the finding that airfields acted as distribution choke points, meaning that even with more planes there would be no improvement in delivery since gear would just pile up at the strip.

Read more: http://www.dodbuzz.com/2010/04/28/too-few-tankers-for-war-depots-hold-1-in-5/#ixzz0mRrvWUeb

[buglerbilly]

Boeing NewGen Tanker Win Would Bring Around 690 Jobs, $33 Million to Ohio

(Source: Boeing Defense, Space & Security; issued April 28, 2010)

ST. LOUIS --- The Boeing Company today announced that Ohio will benefit from approximately 690 total jobs and an estimated $33 million in annual economic impact if the Boeing NewGen Tanker is selected as the U.S. Air Force's next aerial refueling aircraft.

Currently, Boeing works with 500 suppliers/vendors in Ohio, resulting in an estimated $4.7 billion in annual economic impact and supporting an estimated 190,000 direct and indirect jobs in the state.

One of Boeing's key Ohio suppliers is Ravenna-based Allen Aircraft Products, a leader in the production of aircraft fluid systems components and metal finishing processing for both commercial and military aircraft.

"Allen Aircraft and its workers are proud to be a part of a Boeing team that is ready to provide the taxpayer with the best tanker," said Neil Mann Jr., president, Allen Aircraft Products. "This partnership between Allen and Boeing's talented U.S. work force will deliver a much-needed economic boost to Ohio communities and the most capable tanker at the best price to the Air Force."

Some of the other Ohio manufacturers ready to produce critical components on the NewGen Tanker include:

-- Achilles Aerospace Products, Twinsburg – mechanical standards
-- Voss Industries, Cleveland – fabricated clamps.

The NewGen Tanker is a widebody, multi-mission aircraft based on the proven Boeing 767 commercial airplane and updated with the latest and most advanced technology. Capable of fulfilling the Air Force's needs for transport of fuel, cargo, passengers and patients, the combat-ready NewGen Tanker is being offered as a replacement for 179 KC-135 aircraft. Boeing is writing a proposal to meet or exceed the 372 mandatory requirements described in the service's final KC-X Request for Proposal released on Feb. 24. The Air Force is expected to award a contract later this year.

The NewGen Tanker will be made with a low-risk approach to manufacturing that relies on existing Boeing facilities in Washington state and Kansas as well as U.S. suppliers throughout the nation, with decades of experience delivering dependable military tanker and derivative aircraft. Nationwide, the NewGen Tanker program will support approximately 50,000 total U.S. jobs with Boeing and more than 800 suppliers in more than 40 states.

The Boeing NewGen Tanker also will be more cost-effective to own and operate than a larger, heavier tanker. It will save American taxpayers more than $10 billion in fuel costs over its 40-year service life because it burns 24 percent less fuel than the competitor's airplane.

Boeing has been designing, building, modifying and supporting tankers for decades. These include the KC-135 that will be replaced in the KC-X competition, and the KC-10 fleet. The company also has delivered four KC-767Js to the Japan Air Self-Defense Force and is on contract to deliver four KC-767s to the Italian Air Force. Three of the four Italian tankers are in flight test, with the fourth airplane in production.

A unit of The Boeing Company, Boeing Defense, Space & Security is one of the world's largest defense, space and security businesses specializing in innovative and capabilities-driven customer solutions, and the world's largest and most versatile manufacturer of military aircraft. Headquartered in St. Louis, Boeing Defense, Space & Security is a $34 billion business with 68,000 employees worldwide.

-ends-

[buglerbilly]

Tanker battle heats up with EADS smack-talk

By Stephen Trimble on April 29, 2010 7:14 PM

EADS North America, newly-unmuzzled as their own prime contractor for KC-X, has gone on attack. Bullet-style talking points circulated to allies in Congress -- and obtained by this blog -- reveal a level of aggression never quite shown by EADS' former overlords at Northrop Grumman.

The one page set of talking points, for example, takes aim at the reliability of their rival's refueling equipment: "Boeing's KC-767 boom doesn't meet the Air Force's requirement, and its hose pods don't work. So far only their art department has fixes." [Ouch.]

And this: "An aircraft that has never been built is not 'combat ready'." [Zing.]

Talking points are intended to guide friendly lawmakers as they make public comments on issues.

Read the full list of talking points on the jump.


KC-45 Key Messages
29 April 2010

Our aircraft is real, proven and ready today. It is competing against an unproven design that has never been built or flown.

Boeing wants to make the discussion about anything other than tankers, because they don't have one.

The Air Force shouldn't have to take an expensive gamble on an aircraft that only exists on paper.

If staying on cost and on schedule matter, buy an aircraft that's flying now, proven and ready. Buy the KC-45.

Unlike Boeing, the aircraft we have flying today meets the Air Force's requirements NOW, without years of redesign and development.

An aircraft that has never been built is not "combat ready."

Boeing's KC-767 boom doesn't meet the Air Force's requirement, and its hose pods don't work. So far only their art department has fixes.

An award to Boeing is a gamble with taxpayer money and the warfighter's future.


The KC-45 will be made in America by tens of thousands of American workers, and build the U.S. economy for today and tomorrow.

Our aircraft will create and support American aerospace jobs across the country at a time when Boeing is sending jobs overseas.

Our aircraft is an investment in the future of U.S. industry, bringing manufacturing to our shores when Boeing is sending it away.

We're fighting to build up the U.S. economy. Boeing is fighting to preserve a monopoly.

EADS supports 200,000 American jobs and contributes $11 billion to the US economy each year. It is the largest purchaser or American aerospace exports.

We believe in the American worker. Our tanker will be built in Alabama, by the same workforce that our competitor trusts to build rockets.

We will not only build the KC-45 here in America, we will build commercial A330 freighters, creating or supporting tens of thousands more American jobs.


We are a proven and trusted prime contractor, with a model program that is on time and on budget.

We have proven our reliability as prime contractor for the Army's UH-72A Light Utility Helicopter, identified by the Defense Department as one of its Top Five performing programs.

We have delivered every Lakota - more than a hundred so far - on time and on budget. We deliver more than promises.

We are a trusted corporate citizen, providing aircraft and defense technologies to every branch of our armed services.

As the largest aerospace company in the world, EADS has unequalled experience and expertise.


We have built the best plane at the best value. The warfighter and taxpayer deserve the best.

This is the best plane, with more of everything that matters to the warfighter: more fuel, more range, more efficiency, more cargo, more passengers.

'More" means greater efficiency and lower operating cost across missions

'More" means flexibility in mission planning AND in the air

"More" can be the difference between a pilot flying home or having to eject.

Our aircraft will transform how the tanker fleet operates and save money.

Our warfighters should never have to settle for second best. Never in our history have we willfully given them the lesser capability. Now is no time to start.

Boeing is afraid to compete airplane against airplane. That's why they are trying so hard to deprive the Air Force of competitive choice.

Our aircraft has won the last five head-to-head competitions with Boeing tankers, and is in production for four nations.

We have the industrial know-how to build tankers anywhere in the world.

[Unicorn]

I was wondering how long it was going to be before Boeing reacted to getting treated by EADS the way Boeing treated EADS / NG for so long.

Just found the answer:

Dear ________,

As you may know, the U.S.-based Boeing Company and the European Aeronautic Space and Defense Company (EADS), are in the process of responding to a proposal from the United States Defense Department for new tanker aircraft for the Air Force. Yesterday EADS sent Members of Congress information on the KC-X tanker program — a key national security program of the United States — that is false and misleading. This is just the latest in a long line of attempts by Airbus and EADS to distort the truth and muddy the waters. The United States Government recently won a case before the World Trade Organization (WTO) that highlighted the billions of dollars in European government subsidies received by EADS and Airbus to develop their commercial aircraft business, with the WTO finding that these subsidies were illegal under international law. Airbus and EADS have tried to spin an overwhelming United States win in the WTO subsidy case as a loss. Wrong. They have claimed that their European designed and manufactured airplane would generate more American jobs than a Boeing airplane manufactured here in the United States. False. Their most recent propaganda states that their offering for KC-X is ready today. Their website says that their KC-X entrant is flying today. That is just not true. The tanker that EADS is building for Australia does not meet all of the 372 Air Force requirements for KC-X. I hope they do offer this airplane, because it cannot win the competition! Attached you will find some questions that ought to be asked about the Airbus tanker and its ability to meet the Air Force requirements.

Let’s get real on what the two competitors bring to the table for KC-X. Boeing has been in the tanker business for over 50 years. Our NewGen tanker will be tailored to meet all 372 KC-X requirements, providing our men and women in uniform the most combat capable and cost effective airplane. I encourage you to ignore the smoke screen that EADS and Airbus continue to put up. The real facts in this case speak for themselves.

Sincerely,

Tim Keating

Attached Message:
Let’s Get Real

* Airbus is advertising that their European designed and built tanker is “Ready for America Today” and “Ready Now” for the U.S. Air Force.

* Taking even a cursory look at Airbus’s current A330 tanker being built for Australia and just some of the U.S. Air Force’s unclassified KC-X Tanker requirements (and there are plenty of classified requirements too) raises questions as to the truth of Airbus marketing claims.

* If Airbus’s tanker is “Ready Now,” does it currently meet Air Force requirements on:

* A freighter floor?
1 A cargo door?
2 Capabilities necessary to carry hazardous cargo on the main deck?
3 A moveable smoke/fume barrier in the cargo compartment?
4 A centerline hose refueling system?
5 The required hose jettison capability?
6 Duplicate displays and a third seat at the aerial refueling operator’s station?
7 The required quick start and take off capabilities?
8 Certified non-ozone depleting substance fire suppression system?
9 The required on-board inert gas generation system for fuel tank explosion protection?
10 Large aircraft infrared countermeasure system with 3 turrets and ability to handle simultaneous engagements?
11 An armored cockpit to improve crew safety and survivability?
12 Ballistic protection of flight critical aircraft systems?
13 Electromagnetic pulse protection of flight and aerial refueling critical systems?
14 Integrated threat avoidance systems?
15 Ability to meet stated requirements pertaining to a chemical or biological environment?
16 Flight deck display interfaces with aircraft defensive systems?

* The above is a short list of questions addressing only a handful of the Air Force’s unclassified tanker requirements. The list of 372 unclassified and classified Air Force requirements is much longer.

* If Airbus’s answer to any of the above questions is NO, then the Airbus tanker is not “Ready Now” for either the Air Force or the Nation.

* If Airbus’s answer to most or all of the above questions is NO, it means they have several years of investment (subsidized?), design and development work, flight testing and certifications before their tanker is “Ready” or “Proven.”

* If Airbus’s answer to most or all of the above questions is NO, then Airbus has decided to continue its four year campaign of misinformation intended to hide the fact that the European company is new to the aerial refueling tanker business and does not have a tanker that meets Air Force requirements.

* So, Let’s Get Real – Maybe someone should ask Airbus to answer each of the above questions with a simple YES or NO…

Leeham news

Unicorn

[pdf27]

When Boeing are claiming the ozone depletion certification of the A330 is a reason it isn't a capable tanker, they really are getting desperate!

[buglerbilly]

The Hard Sell continues.............

Boeing NewGen Tanker Win Would Bring 7,500 Jobs, $388 Million to Kansas

(Source: Boeing Defense, Space & Security; issued April 30, 2010)

TOPEKA, Kan. --- The Boeing Company today announced that Kansas will benefit from approximately 7,500 jobs and an estimated $388 million in annual economic impact if the Boeing NewGen Tanker is selected as the U.S. Air Force's next aerial refueling aircraft.

"The national recession has hit the aviation industry hard, with thousands of Kansans out of work," said Gov. Mark Parkinson. "The jobs from this contract can provide meaningful economic recovery to our state and country. The delays on this project have been frustrating, and unnecessary. I urge our military leaders to act swiftly and award this contract to Boeing. It's time we bring these jobs home to Kansas."

"I am confident that the Air Force will select Boeing to build its new tanker because I know the strength of the Kansas work force. Our workers will provide the skills and expertise that a new generation of airmen will depend on to keep America secure," said U.S. Sen. Sam Brownback. "I am excited for Boeing to win the contract and get these tankers rolling off of the line, and excited that we are working together to create new jobs in Kansas and grow the Kansas economy."

"This announcement today confirms what we all know to be true, that Boeing will make the best next-generation aerial refueling tanker. Boeing's proposal is based on a proven platform founded on the expertise of a well-established pool of skilled workers," said U.S. Sen. Pat Roberts. "The tanker proposal must be based on a level playing field and not construed to accommodate the business needs of an illegally subsidized company at the sacrifice of American servicemembers."

"While unemployment remains high and our economy is still sluggish, nothing is more welcome news than a possible 7,500 jobs coming to Kansas. An American tanker should be built by an American company with American workers – and that is the Boeing 767 – made by our highly skilled workers here in Kansas," said U.S. Congressman Todd Tiahrt. "I will continue to press the Pentagon for a fair and level playing field for our American workers. With an equal competition, there is no doubt that U.S. workers can compete and win this tanker contract. I look forward to seeing these high-quality jobs come home to the Sunflower State very soon."

Boeing employees working at the Wichita, Kan., site will play an important role in modifying commercial 767 airplanes into NewGen military tankers if the company is selected for the contract. This is highly skilled work that Boeing workers in Kansas know well, having performed similar modifications in recent years on eight 767 tankers for Japan and Italy.

In addition to the 2,586 Boeing employees in Kansas, the company also works with 464 suppliers/vendors around the state, resulting in an estimated $3 billion in annual economic impact and supporting an estimated 125,000 direct and indirect Kansas jobs. Some of the other Kansas manufacturers ready to produce critical components on the NewGen Tanker include:

--Spirit Aerosystems, Wichita – forward fuselage section
--Kaman Aerostructures, Wichita – mechanical components
--Machining Specialists, Wichita – machined metal parts
--McGinty Machine Co., Wichita – precision-machined metal parts.

The NewGen Tanker is a widebody, multi-mission aircraft based on the proven Boeing 767 commercial airplane and updated with the latest and most advanced technology. Capable of fulfilling the Air Force's needs for transport of fuel, cargo, passengers and patients, the combat-ready NewGen Tanker is being offered as a replacement for 179 KC-135 aircraft. Boeing is writing a proposal to meet or exceed the 372 mandatory requirements described in the service's final KC-X Request for Proposal released on Feb. 24. The Air Force is expected to award a contract later this year.

The NewGen Tanker will be made with a low-risk approach to manufacturing that relies on existing Boeing facilities in Washington state and Kansas as well as U.S. suppliers throughout the nation, with decades of experience delivering dependable military tanker and derivative aircraft. Nationwide, the NewGen Tanker program will support approximately 50,000 total U.S. jobs with Boeing and more than 800 suppliers in more than 40 states.

The Boeing NewGen Tanker also will be more cost-effective to own and operate than a larger, heavier tanker. It will save American taxpayers more than $10 billion in fuel costs over its 40-year service life because it burns 24 percent less fuel than the competitor's airplane.

Boeing has been designing, building, modifying and supporting tankers for decades. These include the KC-135 that will be replaced in the KC-X competition, and the KC-10 fleet. The company also has delivered four KC-767Js to the Japan Air Self-Defense Force and is on contract to deliver four KC-767s to the Italian Air Force. Three of the four Italian tankers are in flight test, with the fourth airplane in production.

A unit of The Boeing Company, Boeing Defense, Space & Security is one of the world's largest defense, space and security businesses specializing in innovative and capabilities-driven customer solutions, and the world's largest and most versatile manufacturer of military aircraft. Headquartered in St. Louis, Boeing Defense, Space & Security is a $34 billion business with 68,000 employees worldwide.

-ends-

[buglerbilly]

U.S. Air Force: KC-X Contract Start Date Is Nov. 12

By JOHN REED

Published: 3 May 2010 17:53

The U.S. Air Force has changed its KC-X Request for Proposals to list a contract start date of Nov. 12 despite previous Pentagon announcements that the award for the $35 billion contract would be made in the early fall, according to an April 29 modification to the KC-X Request for Proposals posted on the Federal Business Opportunities website.

This comes about a month after the Defense Department announced that EADS would be granted an extra 60 days to put together a solo bid on the tanker. At the time, the Pentagon insisted that it would be accelerating its evaluation period in order to stick to the original target for a contract award.

The original contract award date listed in the amended RfP is Aug. 16.

That date, along with the term "contract award date," is crossed out and replaced with the term "contract start date" and the Nov. 12 start time. The document does not make clear what the difference between the terms "award date" and "start date."

A Boeing official who had seen the changes was unable to provide immediate insight into the difference between the terms. Officials from the Pentagon and EADS were not available for comment late May 3.

EADS requested a 90-day extension to the bidding period in late March after its former U.S. prime contractor on the project, Northrop Grumman, pulled out of the competition, claiming that the cost-focused request for proposals favored rival Boeing's smaller 767-based design over EADS-Northrop's Airbus A330-based entry.

On April 21, EADS North America officials announced that the European defense giant would take advantage of the Pentagon's offer of an extension and submit a bid by early July. The original deadline to submit bids was May 10.

[buglerbilly]

DoD: Tanker Award Planned In or Near 'Early Fall'

By JOHN REED

Published: 4 May 2010 21:03

Pentagon officials on May 4 clarified their intentions concerning recent changes to the KC-X Request for Proposals (RfP), saying that they still plan to pick a winner and award the U.S. Air Force contract in or around early fall.

An April 29 modification to the tanker RfP, which is posted on the Federal Business Opportunities website, shows the original contract award date of Aug. 6, along with the term "contract award date," crossed out and replaced with the term "contract start date" and the Nov. 12 start time.

The document does not make clear the difference between the terms "award date" and "start date."

In a May 4 briefing, Pentagon press secretary Geoff Morrell said the two were distinct.

"In the RfP, there's a contract start date - not to be confused with the contract award date," Morrell said.

He called the start date an arbitrary date that both companies should build their master schedule around.

"Frankly, we could award it well before then, or we could award it potentially after then. But when you build your plan for submission, build it with that as the start date," he said.

Morrell elaborated in an e-mail message: "We are not delaying the award of the Tanker contract. … Our plan has always been to award the KC-X contract in the fall of 2010."

In the e-mail, Morrell said that the start date does not necessarily determine "when the contract is actually awarded, which can be earlier or later than the planning start date, the plans and schedules are adjusted to reflect the actual date of the award."

Morrell said a planning date "sometime in the fall rather than the summer makes the most sense, especially given that proposals are not now due until mid-July."

The change comes about a month after the Defense Department announced that EADS would be granted 60 additional days to put together a solo bid on the tanker. At the time, the Pentagon insisted that it would speed up its evaluation so it could stick to its plans to award a contract in early fall.

EADS had requested a 90-day extension to the May 10 deadline after its former U.S. prime contractor on the project, Northrop Grumman, pulled out of the competition, claiming that the cost-focused request for proposals favored rival Boeing's smaller 767-based design over EADS-Northrop's Airbus A330-based entry.

About two weeks ago, EADS North America officials announced that the European defense giant would submit a bid by early July.

[buglerbilly]

Boeing Announces Formation of Airlift and Tankers Division

(Source: Boeing Co.; issued May 4, 2010)

ST. LOUIS --- Boeing today announced the formation of the Airlift and Tankers (A&T) division within its military aircraft business unit. The new division will lead the company's sustained pursuit and execution of U.S. and international tanker and fixed-wing mobility aircraft business.

The A&T division will assume program management responsibility for the C-17 Globemaster III and international and U.S. tanker programs.

Chris Chadwick, president of Boeing Military Aircraft, said that the organizational change would allow the business to "increase productivity to enhance Boeing’s competitive position and offer the best available capability, price and risk value proposition for its customers."

"Aligning large, fixed-wing aircraft capabilities under one leadership team will intensify our focus on the warfighter's needs and introduce efficiencies that will result in cost savings for taxpayers," Chadwick added.

Boeing has named Jean Chamberlin as vice president and general manager, Airlift and Tankers, reporting to Chadwick. Chamberlin will be responsible for providing direction and oversight for airlift and tanker programs from advance program development through customer delivery. She will continue to lead Boeing's effort to capture the U.S. Air Force KC-X program, also serving as program manager, USAF Tanker Program.

Rick Heerdt has been named vice president of the C-17 Program -- which will continue to be based in Long Beach, Calif. -- and will report to Chamberlin. Heerdt will be responsible for working with U.S. and international customers to capture new orders, as well as developing and producing cost-effective future airlifter capability.

A unit of The Boeing Company, Boeing Defense, Space & Security is one of the world's largest defense, space and security businesses specializing in innovative and capabilities-driven customer solutions, and the world's largest and most versatile manufacturer of military aircraft. Headquartered in St. Louis, Boeing Defense, Space & Security is a $34 billion business with 68,000 employees worldwide.

-ends-

[buglerbilly]

Delivery of RAAF Air Tanker Support Equipment to Begin

10-05-10

Preparations have begun to deliver thousands of items of tooling and spare parts from Europe to Australia to support the Royal Australian Air Force (RAAF) new fleet of Airbus Military A330 Multi-Role Tanker-Transport (MRTT) air-to-air refuelling tankers.

As part of the Commonwealth’s AIR 5402 acquisition process under which Airbus Military is providing the RAAF with five such aircraft, designated by the air force as KC-30A MRTT, some 4,500 individual components - 500 units of Ground Support and Test equipment and 4,000 spares - will be delivered to 33 Squadron at RAAF Amberley, in Queensland, Australia, over the next three months.

The equipment will be needed when the first A330 MRTT enters squadron service at Amberley towards the end of the year.

Prime Contractor, Qantas Defence Services (QDS), and Airbus Military have signed a Through Life Support (TLS) Contract under which Airbus, through QDS, will ensure ongoing maintenance support to the A330 MRTT fleet over the next 22 years.

The signing was attended by the Chief Executive of Airbus Military, Mr. Domingo Urena, who had travelled from Spain for the occasion. Congratulating the parties, Mr. Domingo said: “Qantas and Airbus Military are the ideal team to deliver the level of services that our customer requires.”

As Prime Contractor, Qantas Defence Services will base some 50 engineering support personnel at RAAF Amberley to manage the Through Life Support programme. In its Design and Maintenance Support role, Airbus Military will provide QDS with Engineering, Logistics, Technical Data, Supply and Training support services. It will also assign two Field Service Representatives to 33 Squadron for three years to ensure a smooth entry into service.

The Through Life Support agreement also provides for future contracts to ensure additional support for the military aspects of the fleet, specifically Deep Maintenance, consolidating and expanding Airbus Military’s presence and role in Brisbane.

Australia has ordered five KC-30A MRTTs. By the end of the year two of these aircraft will have been delivered to the Royal Australian Air Force. Conversion of a third tanker-transport is underway at the Qantas Conversion Centre, Brisbane Airport.

To date, a total of 28 A330 Multi-Role Tanker-Transports have been ordered by four customers – Australia, Saudia Arabia, the United Arab Emirates and the United Kingdom. In addition to its air-to-air refuelling role, the MRTT can also be used as a pure transport aircraft able to carry some 300 troops, or a payload of up to 45 tonnes/99,000 lb.

[buglerbilly]

DATE:11/05/10

SOURCE:Flight International

DoD acqusition strategy key for KC-X bidding process

By Stephen Trimble

If all goes smoothly, the US Air Force will sign a contract in late 2010 to buy 179 operational tankers over the next 13 years, replacing part of a Boeing KC-135 fleet that entered service from 1956.

Of course, the decade-long experience with the KC-X contracting process suggests the aforementioned 'if' is a significant operative. Three attempts to buy new tankers since 2001 have so far yielded only jail terms, political tension and contractual failure.

Political intrusion remains a threat as Boeing and EADS North America prepare to submit bids ahead of a 9 July deadline.

But, among the risks the Department of Defense can directly control, none is more important for the outcome of KC-X than the success of a controversial and complex acquisition strategy adopted since last September to decide the winner of the fresh competition.

It's an approach that has already received sharp criticism. The new KC-X acquisition strategy moved Northrop Grumman to withdraw as prime contractor to former partner EADS on 8 March, with company executives complaining about unfair selection criteria and unwise contracting terms.

The intricate evaluation formula for KC-X even prompted EADS chief executive Louis Gallois to rebuke the strategy the following day, saying the rules offer a "huge advantage" to Boeing's smaller aircraft.

The DoD did not heed calls by EADS to modify the evaluation criteria - although it did extend the deadline for submitting proposals by two months. But Gallois' subordinates at EADS NA decided on 20 April to compete anyway.

"We intend to win," said EADS NA chief executive Sean O'Keefe. "We believe this will be judged on the merits and on the criteria the DoD has laid out."

But the outcome of KC-X could influence more than the evaluation of the Boeing KC-767 NewGen Tanker against the Airbus A330-200-derived EADS NA KC-45.

When the DoD unveiled the criteria for the second competition last September, its objective was not merely for the KC-X contract award to survive a potential protest by the losing bidder.

The past decade has been filled by costly blunders for weapons acquisition. With KC-X, a new DoD regime hopes to set the template by which multi-billion acquisition deals for advanced weapon systems should be done.

Following closely behind the KC-X contract award are requirements to buy new aircraft to replace combat search and rescue helicopters for the USAF, armed aerial scouts for the US Army and presidential helicopters for the US Marine Corps.

The pending deals bear similarities to the KC-X process, as repeats of previous acquisition failures, and are also likely to involve derivatives of existing aircraft.

Among the military's needs to buy new aircraft, however, none are more expensive or sensitive than the potentially $35 billion tanker contract. At the end of the day, the evaluation will be judged not by whether it passes a protest challenge, or is upheld by lawmakers who control the funding.

The true test will be whether the evaluation can select the aircraft that best meets the air force's requirements - but for the right price.

According to Northrop, the ideal aircraft under the selection criteria for KC-X is not in the competition. In fact, the air force is already flying it. "If you were able to build a new KC-135 today, technically, it would win the competition," Mitchell Waldman, Northrop's vice president of business development, said last October.

The solicitation issued in February - but revealed in draft form last September - bases the fuel offload requirement for the KC-X tanker on the maximum capacity of the KC-135R.

In real terms, the air force wants an aircraft that can deliver 42,600kg (94,000lb) of fuel at a 1,000nm (1,850km) mission radius after taking off from a 10,000ft (3,050m) runway.

In the previous competition, the Boeing KC-767AT offered the capability to deliver about 54,400kg of fuel at that distance.

Northrop's larger KC-30 (later rebranded as the KC-45) proposed delivering 69,400kg under the same parameters. The KC-45's extra fuel capacity seemed to be the single most important factor in the air force's analysis. "I know the team looked at a whole number of things," former Gen Artur Lichte, then chief of Air Mobility Command, said on 29 February. "But from my perspective, I can sum [the KC-45 decision] up in one word: more. More passengers, more cargo, more fuel to offload, more patients that we can carry, more availability, more flexibility and more dependability."

But the DoD has changed the rules for the re-competition, giving no advantage in its evaluation to any of the qualities previously identified by Lichte.

Instead, the solicitation requires the bidders to meet 372 mandatory requirements. The proposal that passes each requirement at the lowest price - which is adjusted to account for base construction costs, fuel efficiency and analysed mission effectiveness - wins the contract.

But the DoD also inserted an important caveat. The air force prefers to pay for the minimum performance at the lowest price. However, if the adjusted price of the two proposals falls within 1%, the air force will consider 93 non-mandatory specifications.

It is possible to earn up to 103 bonus points for exceeding the minimum requirement. The bonus criteria includes awarding up to 10 points for a tanker than provides at least 66,700kg of fuel offload at 1,000nm; a metric promised by Northrop's team in the previous competition.

It remains unclear what performance Boeing will promise in this competition, but it could have collected six bonus points with its previous offering under the new rules.

Essentially, that means the air force's new criteria rewards the KC-45's seemingly greatest advantage - size - with potentially less than 4% of the achievable bonus points, but only if the non-mandatory requirements are even scored.

The set-up appears to favour Boeing's smaller aircraft, but only if the manufacturer can beat EADS on price.



"Northrop had a point about this process resulting in a price shootout," says Richard Aboulafia, vice president for analysis at the Teal Group.

Such an outcome appears to favour a Boeing bid, as in theory, a smaller aircraft is cheaper to build and less expensive to operate and maintain.

However, some analysts think EADS can literally give Boeing a run for its money under the new evaluation criteria.

"I think EADS may have more of a shot at it than people think," says Michel Merluzeau, managing partner at Seattle-based G2 Solutions. "If they can demonstrate they meet the requirements then it becomes a price shoot-out."

The KC-45's apparent disadvantage on manufacturing cost, as compared to the KC-767, may not be accurate, Merluzeau says.

Significantly, Northrop and Boeing submitted offers in the previous competition that came within fractions of matching each other on price.

Since that time, two things have changed in EADS's favour, Merluzeau says. Northrop's departure means EADS can scratch the margin claimed by the former prime contractor, which has been estimated at between 10% and 15%. Meanwhile, the predicted softening of the Euro's value in relation to the US dollar also may allow EADS to price more aggressively in the new competition.

"The answer really boils down to one of price," says Ralph Crosby, chairman of EADS NA. "Our risk is small because our development is advanced. This implies that our price for the [system development and demonstration] part of the contract may be lower.

"Our competitor hasn't fully defined their airplane, let alone started to build it. Their price will be a determinate of what they offer."

Crosby notes that "the risk part of the equation has been assigned to the contractor. The tanker for Australia is virtually identical to what we will offer the air force. Based on all data and evidence I have seen, we have a lot less distance to go than our competitor."

In the original competition, the air force's long list of non-mandatory "requirements" is remembered as one of key reasons the competition was poorly managed. The sheer number of non-mandatory specifications seemed extraordinary. Of 808 separate needs specified in the request for proposals, more than 770 were labelled non-mandatory. Reviewing the air force's performance after the US Government Accountability Office sustained Boeing's protest into the KC-45's selection in 2008, the DoD interpreted such a lopsided ratio as one of the signs the competition was mishandled.

In the second go-round, DoD officials took care to correct the imbalance, chopping the list of non-mandatory specifications from more than 770 to 93.

Keeping that number low is sought not only to reduce the chances of a successful protest by a losing bidder.

Cracking down on ambiguous specifications that can lead to costly contract changes later is a major tenet of the ongoing acquisition reform movement.

Non-mandatory specifications often become transformed into real requirements after contract award, generating extra costs with dozens of contractual add-ons.

Deputy Secretary of Defense William Lynn raised that point on 25 February, as he unveiled the final draft of the RFP for the second competition.

"One of the ways you get cost growth is that you add requirements as you go through the programme, and you implement them through engineering change proposals and you increase the price," Lynn said. "That is exactly what would have happened, had the prior competition gone forward to contract."

Of course, the GAO prevented the prior competition from advancing. The air force's mishandling of its 770 non-mandatory requirements was cited as one of eight reasons for overturning the contract award to the Northrop-led team.

Specifically, the GAO's auditors found that the air force had failed to credit Boeing for offering to meet more non-mandatory specifications than Northrop, despite language in the solicitation that asked bidders to satisfy as many as possible.

"Clarity and precision is a very important principle of the acquisition reform effort we have here," Ashton Carter, undersecretary of acquisition, technology and logistics, said on 25 February.

"And so the source selection strategy [for KC-X] is crystal clear," he adds. "We've said that from the beginning. Everybody will know, when a winner is picked, exactly why they won. And up front, both offerors know exactly what they need to do to win."

USAF UNIT OUTLINES CURRENT KC-135 USE

The US Air Force's only permanent European-based tankers are the 15 Boeing KC-135s assigned to its 100th Air Refuelling Wing (ARW) at RAF Mildenhall in Suffolk, England.

Totalling around 75 pilots and 30 boom operators, or "boomers", the unit provides support for regionally based assets, including Lockheed Martin MC-130H/P combat tankers from Mildenhall, Boeing F-15s from nearby RAF Lakenheath and Lockheed F-16s from Spangdahlem AFB, Germany.

Its assets are also called upon to refuel USAF types transiting European airspace en route to Afghanistan and Iraq, and to provide support for fighters from other NATO and Partnership for Peace nations.

The 100th Air Refuelling Wing, based at RAF Mildenhall, uses 15 KC-135s. Picture: Staff Sgt Jerry Fleshman/US Air Force
The 100th ARW has flown the KC-135 since 1970, and its aircraft are now in the Block 40.4 avionics configuration. This features a Rockwell Collins Pacer Crag cockpit and global air traffic management capability.

Its KC-135s are capable of carrying a maximum fuel load of 95,200kg (210,000lb), and of transfering this at up to 3,630kg/min from the tail boom. A boom drogue adapter can deliver up to 1,090kg/min, and three of its aircraft have underwing hose and drogue pods, which can offload a maximum of 1,210kg/min.

Col Creg Paulk, commander of the 100th ARW, says he cannot remember one of the unit's aircraft being flown at its maximum fuel load. "Fighters regularly only take about 70% of the fuel that they've asked for, so we have to plan for inefficiencies."

The wing logged around 6,600 flight hours in 2009, and Paulk says each of his aircraft has typically amassed only 20,000h, despite being an average of 49 years old.

"They are ageing aircraft, but it's more of a maintainer problem," he told IQPC's Air Tankers and Aerial Refuelling conference in London earlier this year. "We see them working a lot on corrosion and the skin, but the engines and avionics are not so much of a problem."

Additional reporting by Craig Hoyle

[buglerbilly]

DATE:11/05/10

SOURCE:Flight International

Chastened Boeing keeps NewGen Tanker mostly a secret

By Stephen Trimble

Since losing the first competition for KC-X, Boeing has retained the same basic type model series in its proposal, but changed virtually everything else about its marketing approach and product offering.

The KC-767 NewGen Tanker, unveiled in a low-key announcement on 4 March, fills in a few essential details, but leaves the most important elements of Boeing's proposal shrouded in mystery.

Such pre-submittal secrecy is normal in the aerospace industry, but the practice contrasts sharply with Boeing's approach in the previous competition. Flush with the confidence of being the US Air Force's incumbent tanker supplier for a half-century, the company spared few details about its proposal in the months before the release of the previous request for proposals.

Boeing, however, initially lost the previous competition before the US Government Accountability Office overruled the air force's decision to award the contract to the Northrop Grumman/EADS North America KC-45.

Jean Chamberlin, newly-appointed KC-767 programme manager, explained in a February interview that she foresaw a tough competition. "I do see it as neck and neck," Chamberlin said. "This is a really tough competition. I'm going to have a hard time thinking about how much I'll disclose now."

Boeing has also launched a very different marketing campaign. If company executives lectured air force officials about refuelling concepts in the first round, they have resisted that urge in the second contest. Instead, Boeing officials have repeatedly stressed that they would listen to the customer's requirements, and respond with the best aircraft the company can offer.

Until the 4 March announcement, Boeing officially was considering either the KC-767 or KC-777, although it conceded that the KC-767 became more likely after the air force issued a draft list of requirements in September calling for a smaller aircraft.

[I]When the KC-767 NewGen Tanker was revealed, however, it was clear that Boeing had decided to offer a very different and more sophisticated tanker to the air force.

A 787-style digital flight deck featuring four 15.1in liquid crystal displays would be integrated on the 767 if Boeing wins the contract. The cockpit also shows two cursor control devices on the instrument panel, similar to the cockpit layout inside the 777. However, the design lacks a fifth multi-function display, as offered on the 787.

The most visible change to the KC-767 airframe are newly-added winglets, as the air force now stipulates a preference for the most fuel efficient aircraft. The new design also incorporates an improved refuelling boom system, which extends from the belly of the centre fuselage. The new boom includes a wider refuelling envelope, Boeing says, and digital control technology.

But there remain significant gaps in the public knowledge about the KC-767. In the previous round, Boeing's offering was sometimes criticised by its opponents as the "Frankentanker". The aircraft was a composite, including the fuselage of the -200, wings of the -300 and cockpit of the -400ER. So far it's not clear which of Boeing's aircraft contribute to the NewGen Tanker's structures and flight control systems. In any event, Boeing is not asking its propulsion supplier to provide any additional power. Pratt & Whitney will deliver the same 62,000lb (275kN) thrust PW4062 engines as offered in the previous competition. The selection of the PW4062, however, does not tip Boeing's hand, as the engine powers all three variants of the 767.

BOEING'S NEWGEN OFFERING BREAKS AWAY FROM LEGACY

Boeing's proposed NewGen Tanker design incorporates numerous major advances over the 767-200-based aircraft already sold to export customers Italy and Japan.

The nations have each ordered four General Electric CF6-80C-engined KC-767s, all in the convertible freighter configuration. This enables them to also fly the aircraft carrying either a full load of cargo, up to 200 passengers or a combination of both.

Japan's air force early this year received its last boom-equipped example from Boeing's local partner Itochu. Deliveries had started in 2008, and the type was placed into operational service at its Komaki air base last July.

Italy's acquisition has been less straightforward, with its air force now expecting to put the KC-767A into frontline use from later this year.

Originally scheduled for delivery from 2007, the model has encountered development delays with key equipment including its Smiths Aerospace hose and drogue refuelling pods. Its aircraft are also equipped with a Boeing tail boom and a centreline hose drum unit. The problems also prompted the company to remove its local conversion partner, Aeronavali, from the project in an attempt to reduce delays.

The configuration selected by Italy has a maximum fuel capacity of 92,000kg (203,000lb), with this having been increased from the design's original 73,000kg limit through the addition of three auxiliary tanks each in the aircraft's forward and aft cargo bays.

The Italian air force is currently using one passenger-configured 767-200 to support training activities for its tanker crews. Boeing is now working to complete certification activities in the USA. "Three of the four tankers are in flight test, with the fourth airplane still being modified," it says.

Additional reporting by Craig Hoyle

[buglerbilly]

DATE:11/05/10

SOURCE:Flight International

EADS touts maturity of A330 MRTT design

By Craig Hoyle

The US Air Force's selection of the Northrop Grumman/EADS North America team's Airbus A330-200-based KC-45 in 2008 was one of the most remarkable decisions made within the last several years.

By rejecting Boeing's offer of a KC-767 to meet its KC-X requirement, the service appeared to have removed the company's decades-old dominance of the air-to-air refuelling sector. It also seemed to have vindicated a bid strategy which had promised to deliver a vital commodity: "more".

But that was not the end of the story, with a Boeing appeal to the US Government Accountability Office having led to the deal's termination over process errors.

Also in early March, Northrop stepped back from a contest that it considered to be unfairly skewed towards a smaller design, leaving EADS NA to go it alone in pursuit of the 179-aircraft deal.

With the contest now in a 60-day extension period approved by the Department of Defense before responses to a final request for proposals must be tabled on 9 July, the gloves have well and truly come off.

EADS has adopted a far more aggressive stance than Northrop in promoting the KC-45 in a bid to fight back against Boeing and its supporters. Fuelled by the results of a World Trade Organisation investigation, which concluded that some Airbus programmes - including the A330 - had received illegal state subsidies from European governments, the KC-767 NewGen Tanker's promoters have dressed the product as an all-US tanker fighting against a transatlantic raider.

But claiming that its North American activities today support 200,000 US jobs and contribute $11 billion to the economy each year, EADS is promoting its own US credentials.

"The KC-45 will be made in America by tens of thousands of American workers, and build the US economy for today and tomorrow," says EADS NA. If selected, the company will assemble its new tanker in Mobile, Alabama, and also bring in similar work on the new A330-200F freighter.

EADS's head of Airbus military derivatives, Antonio Caramazana, says the KC-45 offering will draw heavily on the company's experience in preparing the A330-200 as the KC-30A for the Royal Australian Air Force. "The basic aircraft and the basic air-to-air refuelling solution is very similar," he says.


The A330 MRTT has a maximum fuel capacity of 110,000kg

To enter delayed service from late this year, Australia's new tanker/transports are equipped with an EADS advanced boom refuelling system and a Cobham 905E hose and drogue pod under each wing. Certification work should conclude around mid-year.

"We are working with the RAAF to make the transition," says Caramazana. The service is expected to receive two aircraft late this year before declaring initial operating capability in early 2011. All five of its aircraft will be delivered before full operating capability is achieved during 2012.

EADS would prepare its first prototype KC-45 for the USAF in Getafe, Spain, and complete subsequent aircraft in the USA. It will offer the aircraft with the option of a cargo door, enabling the type to be flown in a passenger/cargo combi configuration, or to carry a freight load of up to 45,000kg (99,200lb).

"The capacity of the A330-200 as a cargo transport is phenomenal," says Caramazana.

Its offering will also use the Cobham 805E fuselage refuelling unit already integrated with one of the UK's first two A330s under the Future Strategic Tanker Aircraft programme. As with all MRTTs sold to date, the design will retain the A330's maximum fuel capacity of 111,000kg.

With Australia's first aircraft now nearing operational use, EADS is highlighting the level of new systems included within Boeing's KC-767 NewGen Tanker, and their potential risk.

"The [US] Air Force shouldn't have to take an expensive gamble on an aircraft that only exists on paper," it says. Selecting a new development would be "a gamble with taxpayer money and the warfighter's future," it argues.

The European Aviation Safety Agency in mid-March granted a civil supplemental type certificate for the MRTT modifications. These include the fly-by-wire boom, an enlarged cockpit with a new operator console for the refuelling system and a universal aerial refuelling receptacle slipway installation to also allow the aircraft to receive fuel from another tanker.

The commercial aircraft's original flight-control laws have also been modified for the latter requirement, enabling a pilot to make more agile inputs in roll.

"It is much more responsive, to keep the aircraft within +/-1ft," says Tim Butler, Airbus project test pilot for the A330 MRTT. "We flew an ex-USAF KC-135 pilot, and he made contact the first time," he notes. "That validates the work that we've done."

In tanker law and with the boom extended, the A330 is restricted to a flight envelope within +2.0g and 0g. A new bank angle mode has been added to its autopilot to provide a more stable tanking platform, says Butler. "It's a great enhancement, as it allows the receiver to stay in contact. It's worked well for us."

Aircraft refuelled during flight testing with Australia's first two KC-30As have included Spanish air force Boeing EF-18s, Portuguese air force Lockheed Martin F-16s and a French air force Boeing E-3F airborne warning and control system platform. The MRTT has also received fuel from a French C-135 tanker.

This work highlighted a safety issue with the wing pod fairing, with the refuelling basket having on one occasion hit the wing while being retracted. The fairing was redesigned to improve hose stability and passed subsequent testing, leading to the late April award of daylight certification to use the hose and drogue system.

Airbus expects its civil certification to be followed "this summer" with military certification from Spain's INTA authority for the hose and drogue system. Flight testing of the aircraft's boom system "is progressing well, and will be completed shortly", it adds.

Located on the enlarged flight deck, the "boomer" operator station features an enhanced vision system which uses images from numerous high definition cameras, and also includes an optional 3D mode.

The same cameras provide images under day, night and dusk conditions, and can be combined to show a 180° panoramic view from wing tip to wing tip.

"We want to give carefree handling to the operator, and to the receiver a reduced workload," says Don Cash, the project's head flight test boom operator. For the operator, the process is hands-off after contact has been made, he notes.

Additional benefits of the system include it automatically knowing, for example, which quantity of fuel to use and which pumps to employ with a specific receiver aircraft.

EADS says the MRTT's size means that it can fly 500nm (925km) before remaining on station for 5h with an available fuel load of 60,000kg. Alternatively, this can be changed to 50,000kg over a 1,000nm distance with a 4h 30min time on station.

In addition to the five ordered by launch customer Australia, Airbus Military has sold a further 23 A330 MRTTs to Saudi Arabia, the United Arab Emirates and the UK.

Australia's third aircraft is now in modification by Qantas Defence Services in Brisbane, Queensland, with this and the programme's last two airframes to undergo customer acceptance flights in the country. An option to buy three more cargo-door equipped MRTTs expired in 2007, but Caramazana says: "we are willing to negotiate again."

The first aircraft for both Saudi Arabia (six) and the United Arab Emirates (three) are now undergoing conversion in Spain, with deliveries to both to start during 2011. The UAE's aircraft will all be completed in Spain and supported locally by Gamco, and there is the possibility for three additional aircraft to be acquired.

Airbus is still negotiating with a potential partner for local involvement in Saudi Arabia, although it says this is not a necessity. "Right now we don't have a solution," says Caramazana. "It has to be a balance between the investment in capital, capabilities and technology transfer."

The first two aircraft from the UK's eventually 14-strong FSTA fleet arrived at Getafe in the second half of last year, and structural modifications have been completed on both. The "prototypes" will be used to support certification activities, with the Royal Air Force's remaining 12 to be modified by Cobham Aviation Services in Bournemouth, Dorset. The entire fleet will carry Cobham 905E wing pods, while half will also use the company's centre fuselage refuelling unit.

The UK's first modified tanker will make its first flight in military guise this September, and enter service in late 2011.

Airbus says it will leverage certification work already performed on Australia's MRTT where possible for the UK programme. After basic certification and qualification, the first two aircraft will be flown to Qinetiq's Boscombe Down facility in Wiltshire to support user trials.

The tankers will be flown with combat types including the BAE Systems Harrier GR9, Eurofighter Typhoon and Panavia Tornado GR4, and with large aircraft such as the Boeing E-3D Sentry and Lockheed Martin C-130J tactical transport.

"We have offered to the market a response to the disadvantage of the old tanker fleet," says Caramazana. Other potential sales opportunities exist in Europe, Asia, the Middle East and South America, he says, with India and France considered near-term prospects.

Airbus Military has also modified several A310 transports for the tanker role for Canada (two) and Germany (four), with the type offering a maximum fuel offload of 60,000kg. Several nations have also ordered air-to-air refuelling equipment for the A400M, which has a 58,000kg capacity.

WHY THE UK SELECTED THE A330 FOR FSTA

The UK's Future Strategic Tanker Aircraft (FSTA) competition also pitted the Airbus A330-200 against Boeing's smaller 767.

Proposed by a BAE Systems, Boeing and Cobham team, the Tanker and Transport Service Company offer was based on delivering a fleet of Rolls-Royce-engined 767-300s to be acquired secondhand from British Airways. This appeared to be a credible means of replacing the Royal Air Force's Vickers VC10 and Lockheed TriStar tanker/transports, which had also seen previous commercial service.

But this perception changed with the RAF's need to perform long-range missions in support of combat aircraft operating above Iraq during the second Gulf War in 2003, and by the demands of the UK's subsequent mission in Afghanistan. Having previously appeared too large, the new-build A330s offered by the EADS UK-led AirTanker consortium suddenly appeared an ideal fit. In addition to delivering air-to-air refuelling services, the type could also be used as a way of providing part of the vital "airbridge" to carry equipment and personnel between RAF Brize Norton in Oxfordshire and Afghanistan.

AirTanker was shortlisted by the Ministry of Defence in January 2004 for the FSTA deal, but protracted negotiations between the parties meant that a contract was not signed until March 2008. The deal covers the provision of 14 leased A330s under a private finance initiative deal worth an estimated £13 billion ($19.9 billion) over 24 years.

[Deks]

Australia's third aircraft is now in modification by Qantas Defence Services in Brisbane, Queensland, with this and the programme's last two airframes to undergo customer acceptance flights in the country. An option to buy three more cargo-door equipped MRTTs expired in 2007, but Caramazana says: "we are willing to negotiate again."

Do we actually have a need for these extra aircraft, or were they simply not affordable ?

[buglerbilly]

Do we actually have a need for these extra aircraft, or were they simply not affordable ?

Yes they are needed and all that needs to be found is the funding.........

[buglerbilly]

Washington State Delegation Slams EADS Over Tanker

By JOHN REED

Published: 11 May 2010 15:56

U.S. lawmakers from Washington state slammed EADS' entry into the Pentagon's $35 billion KC-X tanker competition as unfair to U.S. workers due to European Union subsidies.

Sen. Patty Murray, D-Wash., led the charge during a May 11 news conference on Capitol Hill.

Boeing, which has a large presence in Seattle, will be "competing against the treasuries of European governments," she said.

Murray called for the Defense Department to factor in a recent World Trade Organization ruling that found EADS used unfair subsidies to launch its A330 production line.

Pentagon officials have repeatedly said they will not take the ruling into account.

When EADS' partner Northrop Grumman dropped out of the KC-X competition two months ago, the firm said the Pentagon's request for proposals favored the smaller Boeing 767 over the A330. Now, Boeing and its allies in Congress are accusing EADS of having the unfair advantage.

Sen. Maria Cantwell, D-Wash., said EADS had a government-backed financial parachute regardless of performance, and that the U.S. government "should not have to participate" in doing business with a company that receives such subsidies.

Rep. Rick Larsen, D-Wash., called the delays in the contest resulting from Pentagon's efforts to accommodate EADS' solo bid as "unconscionable."

In late March, the Defense Department said it would grant EADS a 60-day extension to the original May 10 bidding deadline so the European company could put together an offer without the help of Northrop.

On April 29, the Pentagon changed the KC-X RfP to list the contract's "start date" as Nov. 12. The DoD crossed out the term "contract award date," which had been listed as Aug. 16, and replaced it with the term "contract start date" and the November deadline.

Pentagon officials say they will not move the contract award date past the original target of early fall despite the bidding extension.

Last week, Pentagon Press Secretary Geoff Morrell said the DoD would award the contract in "the fall." He went on to describe the "start date" as an arbitrary deadline for contractors to set their overall schedules by.

Larsen could not comment on any legislative efforts being made to address the WTO ruling.

EADS officials were not available for comment May 11.

[Chunder]

Apparently Senator Murray was used as a character stencil for the senator in Iron Man 2.

[JimWH]

What I don't understand is how it even works as an argument. "A330 received subsidies from European governments!" could also be said "European government are paying for some of KC-X!". That's a good thing right?

[Weasel]

What I don't understand is how it even works as an argument. "A330 received subsidies from European governments!" could also be said "European government are paying for some of KC-X!". That's a good thing right?
Oh, well said Jim.

:nutkick

[buglerbilly]

EU Seeks Talks with US Over Aid for Air Giants

(Source: Deutsche Welle German radio; issued May 12, 2010)

The European Union is seeking talks with the United States regarding a long-standing dispute over financial support for European aircraft maker Airbus and US firm Boeing, an EU trade official has said.

The European Union says it is ready to begin talks over controversial state subsidies paid to European aircraft maker Airbus and US aid for aerospace corporation Boeing, a top EU trade official has said.

The talks would focus on efforts by both the EU and the US to have the other party stop providing aid to Airbus and Boeing, respectively.

EU Trade Commissioner Karel De Gucht told reporters the bloc could start talks "immediately," as long as there were no preconditions for future European government aid for Airbus's new A350 plane.

There are concerns that without state support Airbus and Boeing would struggle to develop large aircraft in the future.

At the heart of the dispute are subsidies paid by EU countries to Airbus for the A350. Germany alone pledged 1.1 billion euros ($1.5 billion) to Airbus for the new jetliner, which is seen as a possible future market rival for the Boeing 787 Dreamliner.

The US had filed a case with the World Trade Organization years ago which led to European governments being called on to stop providing such aid.

Airbus argues the WTO verdict does not apply to the A350 as it was handed down prior to the plane's development.

The WTO decision was only the first part of the long-running saga, with another ruling on a counter-complaint brought by the EU against US aid for Boeing expected later this year.

US trade officials also said they were ready to hold talks, "but any productive discussions must necessarily address all WTO-inconsistent subsidies to civil aircraft," USTR spokeswoman Nefeterius McPherson said.

-ends-

[buglerbilly]

Ares

A Defense Technology Blog

Brownback Proposes WTO Penalty for DOD Competitions

Posted by Amy Butler at 5/12/2010 12:31 PM CDT

UPDATE: Geoff Morrell, press secretary to Defense Secretary Robert Gates, says that adopting this legislation would put the U.S. at odds with its obligations as a member of the World Trade Organization. "As members of the WTO, we are not permitted to take unilateral retaliatory action for violations of the trade regulations. That is the purview of the WTO. If we were to do so, we would be in violation of WTO rules and subject to disciplinary action," he says.

Levying penalties unilaterally is referred to as "self help," and is barred from nations that submit to WTO.

This raises the question of whether there is a true goal to enact the legislation or if this is a political move to make the base happy during an election season.

ORIGINIAL POST:

Sen. Sam Brownback (R-Kan.) and Rep. Todd Tiahrt (R-Kan.) are proposing legislation that would require the Pentagon to penalize competitors for work that has been found by the World Trade Organization to have received illegal subsidies, according to industry officials.

They are unveiling the legislation tomorrow morning during a press conference on Capitol Hill.

The legislation is squarely aimed at influencing the pricing duel between EADS North America and Boeing as they compete for $35 billion worth of work building 179 Air Force refuelers. Brownback’s home state, Kansas, would benefit from a Boeing win of the contract. Brownback is a member of the influential Senate subcommittee that appropriates funding for defense programs.

His staff did not immediately respond to queries.

The request for proposals for the work heavily emphasizes low price as a discriminating factor.

Brownback’s language has not yet hit Congress, but Boeing officials are already posturing for it. They have long argued that the WTO’s recent ruling that France illegally subsidized Airbus's business, proves the company has an advantage in proposing pricing for its A330-based tanker.

Kevin Rozelsky, director of legislative affairs for Boeing, outlines the forthcoming bill in a May 11 letter. “If the WTO makes a final determination that a company benefited from a prohibited or actionable subsidy, that illegal subsidy is considered as part of the final price in a DoD acquisition,” he says in his letter. Effectively the legislation would require a penalty for a proposal put forth by a competitor found to have accepted illegal subsides. “We’re very concerned that the illegal European subsidies are going to allow Airbus to underbid Boeing significantly, and then in a fixed-price contract, they win the day. Boeing is ready to compete, but only when the competition is fair.”

"We remain deeply concerned about the ability of a heavily subsidized EADS to accept levels of financial risk that a commercial company such as Boeing cannot," A Boeing spokeswoman says. "To date the Defense Department has not taken these illegal subsidies into account, even though the U.S. government has proven in a world court that those subsidies are illegal and directly distort competition between Airbus and Boeing."

If Congress passes the measure and it becomes law, it could force the Air Force to start over with the KC-X competition, or at the very least significantly alter the calculations for pricing. Rozelsky’s letter specifies that the legislation would apply to “all major defense awards,” not just KC-X. And, it is unclear how far the requirements would go. If there were a subsidy dispute against a nation over agricultural subsidies, for example, it is unclear whether an adverse WTO ruling would have to be taken into account if that country’s industry supported a bid for a Pentagon contract.

Pentagon officials have continually said they will not take WTO findings into account in source selections.

“Boeing’s strategy for success is to take away the warfighter’s right to choose and force the largest, directed ‘earmark’ in U.S. history,” says EADS North America spokesman Guy Hicks, because the legislation is viewed as favoring Boeing’s proposal.

[buglerbilly]

Inouye: Maybe We'll Study WTO Tanker Question

By JOHN REED

Published: 12 May 2010 14:37

The powerful chairman of the U.S. Senate Appropriations Committee on May 12 said that he would consider studying whether Congress should require the Pentagon's KC-X tanker contest should take into account a recent World Trade Organization ruling against EADS.

"I would like to study it," Sen. Daniel Inouye, D-Hawaii, told reporters after a May 12 Senate Appropriations Committee hearing. "First, it's an important issue and it involves relationships with other countries and I'd hate to make a decision right here on the floor."

The WTO found that Airbus used unfair subsidies to produce its A330 jet, a variant of which is likely to compete against the Boeing 767 for the $35 billion tanker contract.

Inouye said that any study into the matter will be performed "as soon as possible."

In late April, Pentagon officials changed the KC-X contract start date to Nov. 12.

During the hearing, fellow appropriators Sens. Sam Brownback, R-Kans., and Patty Murray, D-Wash., repeatedly asked Air Force leaders why the service is not taking the WTO ruling into account. Both have Boeing production facilities in their states.

"If you award this to Airbus after the extraordinary step of extending the time period of this $35 billion contract, and it's a subsidized platform … I think you're going to have some very irritated people in the United States," Brownback said to Air Force Secretary Michael Donley and Chief of Staff Gen. Norton Schwartz. "I hope we can give you some statutory clarity on figuring the subsidy price into these military contracts."

Just one day earlier, Murray was joined by fellow Washington state Democrats, Sens. Maria Cantwell and Rick Larsen, at a Capitol Hill news conference slamming EADS use of the subsidies.

Murray and her fellow lawmakers repeatedly called for the Pentagon to take the subsidies into account during the tanker competition, with Murray going so far as to say that otherwise Boeing will be "competing against the treasuries of European governments."

[buglerbilly]

USAF Declines to Give KC-X Award Date

By JOHN REED

Published: 12 May 2010 14:40

Senior U.S. Air Force officials May 12 declined to answer lawmakers who wanted to know when the service will pick a winner in the KC-X tanker contest.

"I'm very concerned about the discussion about a projected contract start date of Nov. 12 when there's no projected award date that I know of yet and the entire acquisition process continues to be hampered by delays," said Sen. Patty Murray, D-Wash., at a Senate Appropriations Committee hearing on the Air Force's 2011 budget. "How can the Air Force talk about tentative start dates when they haven't projected an award date yet and seem sort of uncertain about when that will be?"

Air Force Secretary Michael Donley responded, "Based on our experience in this RfP [request for proposal] and previous RfPs, the judgment was it's best not to pin down exactly when the contract award would be. We'll leave that to the source selection authority."

Donley noted that the deadline for bids is July 9, and repeated the Pentagon's message that the service will "have ample time to review proposals."

In late March, the Pentagon changed the May 10 deadline so that EADS could put together a solo bid following the departure of its former KC-X partner Northrop Grumman. Pentagon officials said at the time they would accelerate the bid evaluation process in order to meet the original contract award target date of "early fall."

Last week, Pentagon Press Secretary Geoff Morrell reiterated that the KC-X contract would be awarded sometime in the fall.

On April 29, the Pentagon crossed out the term "contract award date" and its corresponding date of Aug. 16 in the KC-X RfP and replaced the term with the words "contract start date" and a new deadline of Nov. 12. It did not explain the difference between the two.

Morrell described the term "start date" as an arbitrary deadline to help contractors prepare their master schedules.

[buglerbilly]

DATE:13/05/10

SOURCE:Flight International

US lawmakers propose law to add subsidies to cost of KC-X bids

By Stephen Trimble

US lawmakers supporting Boeing's pursuit of the KC-X tanker contract today proposed a law that would force the Department of Defense to add the value of improper subsidies to the cost of competitors' bids.

The bill would force the US Air Force to add extra costs to the KC-45 bid from EADS North America, which intends to offer a modified Airbus A330-200.

If the Fair Defense Competition Act becomes law before the contract award date in the fourth quarter, the legislation could help tilt the USAF's price-sensitive evaluation in favour of Boeing's NewGen Tanker proposal, which is based on a modified 767.

"This bill will ensure DoD runs a fair tanker competition and that no bidder is rewarded for benefitting from illegal government support," says Sen Sam Brownback, of Kansas. Boeing will complete KC-767 modifications in Wichita.

The bill was introduced by Brownback, Kansas Rep Todd Tiahrt and Washington Sen Patty Murray. Co-sponsors of the bill included members from Boeing's headquarters in Illinois and new manufacturing base in South Carolina.

EADS NA released a statement criticising the proposed law as "one more attempt to avoid competing on the merits of the tanker".

In March, Airbus acknowledged that the World Trade Organisation ruling on the US-brought case concludes the company benefited from an "element of subsidy" to finance the development of the A330.

Airbus, however, interprets the ruling as confirming Europe's reimbursable loan mechanism - or launch aid - is legal under WTO policy.

That interpretation is disputed by rival Boeing, which boasted in March that the ruling means the "United States has prevailed on all of the major issues".

Adding the cost of improper subsidies could have a major impact on the KC-X competition.

The air force's evaluation process awards the contract to the bidder who meets all 372 mandatory requirements at the lowest evaluated price. If the bidders come within 1% on price, the air force will add up bonus points awarded for meeting 93 non-mandatory requirements.

The US Trade Representative has estimated that Airbus received $5 billion in improper subsidies from European governments on the A330, Brownback says.

It is less clear how the bill could impact Boeing's KC-X pending the outcome of a European Union-brought case to the WTO. That ruling is expected to be released in the third quarter.

[buglerbilly]

Real Tanker News: The Boeing Bill

(Source: EADS North America; issued May 12, 2010)

“We listen to our customer. It is not our job to tell our customer what the warfighter needs.”

In defense procurement you’ll often hear that said, because that is the mission of the defense industry – to serve the warfighter. That is why it is most startling, this morning, to read this Reuters story highlighting how one competitor in the KC-X tanker competition has decided to use the legislative process to manipulate the way the Air Force is permitted to manage this $35 billion procurement. That company is Boeing.

At issue is a pair of international commercial trade disputes involving the European Union and the United States over what is and what isn’t appropriate government support for commercial aircraft development. The Pentagon long ago decided this issue is not relevant to a defense acquisition.

Boeing has signaled to the Air Force (the customer) that it refuses to accept that determination or the Department's right to make it.

The Reuters report highlights an email being shipped around Capitol Hill – written by one of Boeing’s employees – seeking co-sponsors for what can only be called the Boeing Bill. The Boeing Bill is a piece of legislation that would direct the Air Force to manage the tanker competition the way Boeing wants it run by factoring in those disputes in a manner favorable to Boeing, rather than running it the way the Air Force long ago said it wanted to.

The goal? To make certain that only one company in the KC-X competition (Boeing) has an opportunity to win. The reason is clear. Only EADS North America has a tanker and refueling system responsive to the Air Force’s needs. Boeing doesn’t have such an airplane and is likely years away from developing it. The aircraft it does have has lost every head-to-head competition against the tanker EADS is offering the Air Force.

By securing passage of the Boeing Bill, the merits of the two company's offerings won’t matter and the KC-X competition will be turned into the largest earmark in U.S. history. Furthermore, without competition, Boeing can charge the taxpayer what it wants with no assurances that the airplane it ultimately does develop is at the level of quality and capability that our men and women in uniform deserve. That’s a bill with a potential cost far too high to pay.

To see the EADS North America KC-45 in flight and to learn more about the tanker competition, visit our website, www.KCNow.com.

The Boeing Bill: Episode 2

(Source: EADS North America; issued May 13, 2010)

As part of what aviation analyst Scott Hamilton describes Scott Hamilton describesas “the strangest marketing campaign we’ve ever seen”, a bill will be introduced today in Congress that is designed to rob the warfighter of competitive choice and force a de facto sole source award to Boeing. Effectively a $35 billion earmark for Boeing, the legislation addresses a wide range of issues except the most important one: Ensuring the warfighter can choose the most capable tanker to meet its requirements.

Boeing and its supporters studiously avoid discussing its proposed tanker – and instead raise a convoluted legislative smokescreen – for one simple reason: Boeing does not have a tanker that meets the Air Force’s needs, and won’t have one for the foreseeable future.

Rather than engage in legislative shell games at the expense of American men and women in uniform, EADS North America is singularly focused on offering the US Air Force our KC-45, a real, proven and ready tanker aircraft. The KC-45 is the only tanker being offered to the Air Force that is certified and flying today. That is why the Boeing Bill seeks to prevent the Air Force from having an opportunity to select it.

As Hamilton asks:

“Why aren’t they talking about the airplane?...That’s what counts for the warfighter. If anybody bothers to remember them.”

We remember, and we support the warfighters’ right to decide which tanker is best for them.

-ends-

[buglerbilly]

Boeing Source: We May Not Bid For KC-X

By VAGO MURADIAN and JOHN REED

Published: 14 May 2010 17:57

Boeing is considering not bidding for the U.S. Air Force's KC-X tanker contract, a company source said May 14.


Boeing CEO Jim McNerney and other executives are privately debating whether their company can even win, much less make a profit, on the fixed-price contract, an executive told Defense News. (Boeing)

That would leave Europe's EADS - which earlier this year had threatened its own pullout - as the sole bidder for the multibillion-dollar prize.

CEO Jim McNerney and other executives are privately debating whether their company can even win, much less make a profit, on the fixed-price contract, one senior Boeing executive said.

"Is it conceivable that we wouldn't bid?" the executive said. "We are proud of the fleet and want it to win the contract so the Air Force keeps flying our planes. Your heart says you have to be part of it, but a CEO's job is to make sure that the heart doesn't make a decision the head can't live with."

Boeing spokesman Damien Mills insisted May 13 that the firm will bid.

But Boeing supporters have long complained that illegal subsidies would lower EADS' bid price, and company officials have said for several weeks that the Pentagon appears to have shifted requirements to favor the European firm.

Earlier this year, DoD officials - eager to avoid a sole-source award to Boeing in the wake of Northrop Grumman's withdrawal - delayed the bidding deadline 60 days to allow EADS to bid. DoD also allowed the European firm to enter the contest without a U.S. firm as a partner.

Pentagon officials say they have changed neither the requirements nor the way the bids will be evaluated.

"Jim doesn't want to be in a position that we are going to bid a losing bid," the Boeing executive said. "It gets difficult when you're dealing with a competitor who has flat-out said on several occasions that they're going to underbid us. How can they do that if the list price of their plane is higher than the list on our plane? Because they are subsidized and we're a for-profit company, so the question we're asking is: How do we compete against four governments?"

The average cost of a Boeing 767-200ER is $133 million, of an Airbus A330-200F, $194.8 million, according to Teal Group aviation analyst Richard Aboulafia.

The executive said Boeing has not arrived at a decision. He said raising the prospect of sitting out was not a negotiating tactic.

On May 13, Pentagon officials said that they have heard nothing from Boeing about leaving the competition.

Subsidy Scuffle

Boeing executives and its supporters say Airbus, which has garnered more than half of the commercial jet market in recent years, has been powered by tens of billions of dollars in subsidies over four decades. The World Trade Organization last year concluded that subsidies have helped Airbus to create products that have more effectively competed against Boeing on world markets. Europe has countersued, claiming Boeing benefits from research and development tax credits.

On May 13, two Republican lawmakers from Kansas, Sen. Sam Brownback and Rep. Todd Tiahrt, introduced legislation in the U.S. House and Senate that would order the Pentagon officials who will weigh the KC-X bids to factor in the startup subsidies EADS received for its A330. Tiahrt said he estimates the subsidies to be worth about $5 million per airplane.

The Pentagon says it will not take the WTO ruling into account because EADS plans to appeal, and waiting for the outcome could add yet more years of delay to the tanker effort.

Dubbing the proposed legislation "The Boeing Bill," EADS spokesman Guy Hicks called it "one more attempt to avoid competing on the merits of the tanker."

Analysts Respond

A financial analyst said a prudent Boeing would consider all options.

"If Boeing can't make a fair return for their investment, then they shouldn't do it," said Ron Epstein of Banc of America. "Shareholders would rather see Boeing cover its cost of capital than win an unprofitable contract. If EADS is going to bid below their cost of capital to subsidize our military, great, they should do it."

But Aboulafia is skeptical: "It would be a very bold move if true - possibly too bold."

Analyst David Berteau of the Center for Strategic and International Studies said he doubts that Congress will be able to write effective legislation in time to affect the competition.

He also said Boeing's threat is unlikely to sway Pentagon officials who have said that they "prefer a competition, but they'll move forward with only one" bidder.

[Deks]

Oh boeing, you make me laugh.

I don't for one second think they'd withdraw, but can you imagine if they did? EADS has many reasons for wanting to win the competition, which go far beyond KC-X. Setting up the US based assembly plant is a good thing for them, so no doubt they can afford to sell at below cost to subsidise their other operations.

[Chunder]

Boeing has already had the competition price of the previous EADS/NG proposal divulged to it. They are also aware of NG's profit margin...

I.E they have a decent idea of how much lower EADS can go before becoming cost neutral.

Though guaranteed cost neutral today is not cost neutral in 5, 10 years time.

Boeing have it pretty good, they are well aware of what EADS profit margin will be, if any.

That puts them in a pretty good position to bid really. Most people would be dying to know the competitors "maximum" bid at auction.

Not particularly sure that EADS, which is sensitive to operational losses can really afford to run at much of a loss anyway?

Makes it a pretty clear cut bid for Boeing.

[Deks]

If you consider the list prices of 133m / 199m for the 767 and 330F respectively, I can't imagine a case where there wouldn't be a rediculous amount of margin in there. Sure they're big aircraft, but they've been in service so long there's not a whole heap of re-invention going on. Boeing still needs to actually develop the KC-X, which will push their costs up though. EADS on the other hand basically has the aircraft fully developed and has a concrete idea of how much it'll cost them to build them. I'd like to think that extra certainty is worth perhaps tens of millions of dollars, and may end up having them under-bid boeing, or boeing bidding so low that they don't make a great deal of money and are forced to assume a great deal of risk.

While it's true that Boeing saw the pricing data from the last go around, that included NG's costs which no doubt have their own margin for working with EADS. It's been said that that 'premium' of working with NG was something like 10-15%, so I've little doubt EADS will be able to bid under what they did last time.

Whilst I still think Boeing will win this, I think the USAF will pay far less than they otherwise would have. That being said, it's not over yet. :)

[Chunder]

Im just unconvinced that EADS would significantly underbid. The defence market may be huge & it may be a shoe in, but EADS is not in particularly good financial shape either. If one looks at the A-400 Saga, and the refusal to disclose projected break even point for the A-380 (stock value). The Proposed market for the A-330F is not particularly great either, all things considered, part of those considerations means taking into account the development programme for the A-350 and problems that could pose for them. It could be an absolute disaster for EADS one a CEO would be unwilling to do.

Boeing can pretty reasonably estimate the profit margin if any for EADS. It makes it pretty easy for them to offer a price readily.

It won't withdraw.

IMO the sinister side of me says this isn't a case of Boeing complaining because of the competition - it's complaining because it knows the competitions disclosed price & can reasonably estimate off of that.

As you say, there isn't really much cost in twisting metal, however.

[buglerbilly]

Ares

A Defense Technology Blog

Double Negative: Boeing is Not Not Bidding KC-X?

Posted by Amy Butler at 5/17/2010 10:08 AM CDT

Apparently, Boeing executives are discussing not bidding for KC-X. Discussions of whether to bid are a corporate duty of the executives involved in capturing new business for the company.

But, after the lease debacle in '01/'02, a lost bid in 2008, a vigorous and ultimately successful protest, a scrapped competition last year and a new round this year are we to believe that Boeing is really considering walking away?

The bottom line is that the company is concerned about being underbid. The legislation proposed last week by a bevy of Boeing supporting congressman underscores that. And, it makes sense for the company to weigh its options. Defense consultant and thinktanker Loren Thompson opines that Boeing is considering pulling a play from Northrop Grumman's playbook by floating a no-bid threat.

Could be the case. But I see the bottom line differently for Boeing. Northrop Grumman was never in the tanker business; a win would have been gravy for the company. A loss would represent lost bid and proposal fees, but ultimately, not a major ding on the company's credibility. What was a concern was a bid with little revenue making opportunity -- money on the backs of accountants for years to come.

For Boeing, though, it is different. Building tankers for the U.S. Air Force is core to the company's business. And, without major fighter work to come for the company, it is an area that officials want to maintain dominance in.

This whiff of a no-bid could be a Hail Mary by Boeing to try and force the Pentagon to include a WTO penalty in the competition. Or, it could be an attempt to build a cover story for investors in case the company loses on price. Remember the last competition loss forced some soul-searching at the company even though it was ultimately found to be fraught with errors by GAO.

Boeing spokesman Dan Beck says he can't comment on any "discussions that did or did not happen within Boeing" about bidding. But, "as we have said all along, our intent is to bid and submit a proposal that meets all of the requirements."

Still, he didn't miss a chance to add that company officials are "deeply concerned about the ability of Airbus and EADS, a heavily and illegally subsidized company," to underbid Boeing. He says that the company "regrets" that the WTO's decision that Airbus accepted illegal subsidies will not be considered in the source selection.

So, what do you think? Is Boeing serious about a no-bid threat, or pulling an old tanker play from the playbook?

[buglerbilly]

Airbus Military A330 MRTT refuels second A330 MRTT

Airbus Military has for the first time demonstrated in flight “buddy” refuelling between two A330 MRTT aircraft.

Madrid, 17 May 2010


© Airbus

To-date three such flights have been performed, the latest one being part of the certification flight trials. This type of operation further illustrates the capability of the new-generation A330 MRTT tanker to refuel any kind of large receiver, even wide-body aircraft like another A330 MRTT or receiver aircraft with complex aerodynamics such as the E-3 AWACS tested in February. It also demonstrates the capability of the aircraft as a receiver and means that the A330 MRTT is now both the largest aircraft to have refuelled an A330 MRTT and the largest to have received fuel from it.

The two aircraft used for these flight trials were the first two A330 MRTTs built for the Royal Australian Air Force. They are both now being used in the final stages of the certification programme due for completion in the next months.

During the flights, performed over the Gulf of Cadiz in southern Spain, fuel was passed from the refuelling aircraft´s Air Refuelling Boom System (ARBS) to the receiving aircraft´s Universal Aerial Refuelling Receptacle System Installation (UARRSI).

Programme director Airbus Military Derivatives, Antonio Caramazana, said: “This latest flight demonstrates the ability of the A330 MRTT to refuel a true widebody aircraft and to conduct buddy-buddy refuelling between two tankers, which is a vital enabler for even longer range deployments.”

[buglerbilly]

Boeing says it will bid for US tanker deal, despite concerns

By Andrea Shalal-Esa

WASHINGTON, May 17 (Reuters) - Boeing Co (BA.N) on Monday said it intends to bid in a multibillion-dollar U.S. Air Force refueling plane competition although it remains concerned that rival bidder EADS (EAD.PA) could have an advantage in the competition because it receives government subsidies.

Defense News on Monday quoted an unnamed senior Boeing executive as saying that Boeing was considering not bidding for the contract, valued at up to $50 billion, given concerns about whether the company could win the deal or make a profit.

The two companies must submit bids by July 9 to build 179 new aerial refueling planes for the Air Force -- the U.S. military's third attempt in nine years to begin replacing its aging fleet of KC-135 tankers.

Defense analyst Loren Thompson said Boeing's top defense executive Dennis Muilenburg raised the possibility of pulling out of the competition with company insiders last week, apparently convinced that the Pentagon was "trying to rewrite the selection criteria to favor a team led by EADS."

In a blog posted by the Lexington Institute, Thompson said he doubted Boeing would truly withdraw from the competition, and its executives were probably being "paranoid," since the Air Force's framework still seemed to favor the smaller, cheaper Boeing 767-based airplane over EADS' larger A330.

Boeing spokesman Dan Beck said the company planned to submit a low-cost bid that met all of the Air Force's requirements, but the company regretted that its concerns about subsidies to EADS, the parent of Airbus, would not be reflected in the Pentagon's evaluation of competing bids.

Boeing executives "are deeply concerned about the ability of a heavily and illegally subsidized Airbus/EADS to accept levels of financial risk that we cannot in a way that distorts the competition," Beck said.

One source following the issue said Boeing was keeping its options open, particularly if the Air Force made changes to the final request for proposals before the July 9 deadline that appeared to favor EADS.

But it was difficult to imagine Boeing withdrawing from a competition worth tens of billions of dollars at a time when overall defense spending is expected to flatten out or even decline, said the source, who was not authorized to speak on the record.

"I think that Boeing is playing with enormous fire here," said analyst Scott Hamilton of Leeham Co, adding that Boeing risked angering the Air Force and Defense Secretary Robert Gates by politicizing the tanker competition.

Gates canceled the last tanker deal, which Boeing had lost to EADS and Northrop Grumman Corp (NOC.N) after government auditors partially upheld Boeing's protest and lawmakers became deeply involved in debating the procurement.

Boeing-backed legislation that would add the cost of any subsidy deemed illegal by the World Trade Organization to major weapons contracts could also backfire, he said, noting that the trade body was due to rule next month on a European countersuit alleging that Boeing benefited from illegal tax subsidies.

The WTO ruled earlier this year that Airbus benefited from billions of dollars of European government subsidies to develop its A330 wide-body aircraft, among other commercial planes.

The Defense Department says it cannot factor the ruling into its procurement, given that it could still be appealed.

EADS declined comment on the Air Force's tanker procurement process, but said reports of a possible Boeing withdrawal were "another attempt to distract attention from the fact that EADS North America has a more capable tanker that is flying today, while Boeing can only offer an untested conceptual design."

One defense official said the Pentagon was keenly aware of the importance of the tanker competition and was at pains to ensure a flawless process this time around -- and that meant strictly limiting any conversations with the rival bidders.

"We know we have to get this right this time," said the official, who was not authorized to speak on the record. (Reporting by Andrea Shalal-Esa; editing by Carol Bishopric)

[JimWH]

So, reading between the lines "We [Boeing] have tested the water to see whether or not threatening to pull out would make the Pentagon play our game. It won't so we're back."

[Deks]

Well of course they fucking will. argh!

The so called 'boeing bill' is pretty rediculous though. It basically says europe is not allowed to subsidise the US DoD, as if that would ever be a bad thing!

[buglerbilly]

EADS North America's KC-45 Again Demonstrates Readiness for U.S. Air Force Operations

(Source: EADS North America; issued May 19, 2010)

ARLINGTON, VA --- In the latest demonstration of the readiness and capability of the EADS North America KC-45 aerial refuelling tanker, two A330 Multi Role Tanker Transport (MRTT) aircraft have completed successful tanker-to-tanker refueling missions. The KC-45 is the configuration of the Airbus Military A330 MRTT being offered to the U.S. Air Force, and is the only tanker in the Air Force competition that is flying and refueling today. The KC-45 will be built by 48,000 Americans nationwide, and if selected will be complemented by production of civilian freighter aircraft in Mobile, Alabama.

The two A330 MRTTs that completed the tanker-to-tanker refueling operations are in certification flights for Australia, one of four American allies that have selected the A330 MRTT over Boeing 767 tankers. The A330 MRTT has also successfully refueled F-16 and F/A-18 fighters, and the large, aerodynamically complex E-3 AWACS.

"The 'buddy' refueling missions underscore the KC-45's ability to conduct large fuel onloads and offloads, and reconfirm it as the only tanker in the U.S. Air Force competition that meets the warfighter's needs and is flying today," said EADS North America Chairman Ralph D. Crosby, Jr. "With the KC-45, America's warfighters have a mature, mission-ready answer for their critical refueling requirements."

During the buddy refueling missions, one MRTT passed fuel from its advanced Aerial Refueling Boom System (ARBS) through the other aircraft's Universal Aerial Refueling Receptacle Slipway Installation (UARRSI), mounted above and behind the cockpit. Both systems are identical to those offered on the KC-45 and meet U.S. Air Force performance requirements for its KC-X tanker fleet modernization program.

The KC-45 configuration also features the all-digital Cobham 900-series hose & drogue refueling pods, which have also performed numerous successful refueling operations with the A330 MRTT and probe-equipped receiver aircraft. The A330 MRTT offers the most advanced aerial refueling systems flying in the world today.

A total of 28 A330 MRTTs have been ordered to date, with the United Kingdom, Saudi Arabia and the United Arab Emirates joining Australia on the customer list. Aircraft are now in tanker conversion, flight test or final certification for all four of these international customers -- underscoring the tanker program's maturity and sustained production pace.

EADS North America will build and modify the KC-45, along with A330 commercial freighters, at a new aerospace center of excellence to be constructed in Mobile, Alabama. The addition of freighter manufacturing could increase total aircraft production significantly, with an associated increase in American jobs. The KC-45 and A330 freighter will support a U.S. supplier team of more than 200 companies across America.

EADS North America is the North American operation of EADS, a global leader in aerospace, defense and related services. As a leader in all sectors of defense and homeland security, EADS North America and its parent company, EADS, contribute over $11 billion to the U.S. economy annually and support more than 200,000 American jobs through its network of suppliers and services. Operating in 17 states, EADS North America offers a broad array of advanced solutions to its customers in the commercial, homeland security, aerospace and defense markets.

-ends-

[buglerbilly]

Boeing: Mulling All Options on Tanker

By JOHN REED

Published: 21 May 2010 16:12

Boeing officials this week declined to rule out abstaining from the U.S. Air Force's KC-X tanker competition.

"We're deeply concerned about the ability of a heavily and illegally subsidized Airbus/EADS to accept levels of financial risk that we cannot in a way that distorts the competition," said Boeing's tanker spokesman Bill Barksdale in a May 21 e-mail. "Given that fact, and until all final RFP amendments are in, it's only prudent not to completely discard our options."

Still, "we want to win this business," Barksdale wrote. "We INTEND to bid, and we are working hard to submit a financially responsible proposal."

On May 14, a senior executive at Boeing told Defense News that the company is weighing whether or not to bid in the contest given EADS' perceived ability to undercut the Chicago-based defense giant.

Barksdale wrote in response to questions about a Bloomberg report that Boeing's top defense executive, Dennis Muilenburg, said at a May 20 investors' conference, that any bid must be "financially viable."

Boeing executives and the company's allies on Capitol Hill worry that rival EADS will take advantage of its financial backing by European governments to underbid any Boeing offer in the competition.

EADS is offering a tanker version of its Airbus A330 airliner in the competition while Boeing is pitching a modernized tanker variant of its 767.

The list price for the A330-200F - the model the EADS jet is based on - is nearly $62 million more expensive than the Boeing 767-200ER which is listed at $133 million a piece according to the Teal Group aviation consultancy.

However, EADS officials are confident that they can put together a bid that comes within 1 percent of Boeing's price; a move that would require the Pentagon to evaluate the planes based on bonus performance criteria that could give an edge to the larger, newer EADS jet.

WTO Ruling on EADS

On May 19, the U.S. House Armed Services Committee voted to require the KC-X contest to take into account a recent World Trade Organization ruling that EADS uses unfair subsidies to the tune of $5 million a jet to build its A330s during the committee's mark-up of the 2011 defense authorization bill. A similar bill is being worked in the U.S. Senate led by Kansas Republican Sen. Sam Brownback. However, that effort faces an uphill battle according to Brownback, who had only four cosponsors when the bill was unveiled on May 13.

Still, Boeing will almost certainly bid, said Teal Group aviation analyst Richard Aboulafia. He said Boeing is working "to give all the ammunition they can to their political allies who are arguing that the subsidies should be taken into account."

Aboulafia also doubts that the proposed congressional mandate would raise the price of the EADS bid enough to affect the program because Airbus can easily lower its asking price.

[buglerbilly]

Boeing Cites National Security Risk on EADS Tanker

By JOHN REED

Published: 25 May 2010 15:04

Jeez Boeing is coming up with some nebulous CRAP! :doh

Upping the rhetoric in the $35 billion KC-X tanker competition, top Boeing executives today urged U.S. policy makers to consider the national security implications of buying tankers from EADS.

"Foreign-owned companies have withheld material goods and support" from Boeing's Joint Direct Attack Munition and other weapons, said Tim Keating, Boeing's senior vice president for government operations. "What would happen if this were a tanker? Could they and would they withhold spare parts and aircraft to impose state policy against the U.S., and what recourse do we have?"

While EADS officials say that their KC-X program will be run entirely under the aegis of their independent U.S. subsidiary, EADS North America, Boeing officials say that most work on the Airbus 330-based tanker would be performed by EADS' European division, not the 1,700-person American branch.

Keating said, "We need to have a policy debate" in government and Congress on the national security implications of having a European-owned company building a major U.S. weapon and on the economic impact on American companies.

Keating accused EADS of seeking to sell helicopters to Iran, citing a 2005 NBC news report on the issue.

EADS officials shot back at Boeing's allegations.

"Boeing's ongoing misinformation campaign is an attempt to make this competition about anything other than getting the best tanker for the Air Force. We're proud that the Department of Defense has previously selected us as a trusted U.S. prime contractor, and we're proud of the 48,000 Americans on our tanker team who will build the KC-45," EADS spokesman James Darcy said.

Boeing officials have repeatedly expressed concern that EADS would use its financial backing by European governments to outbid them.

The Chicago-based company's allies on Capitol Hill are working on legislation that would require the Pentagon to include the cost of start-up cash EADS received from European governments to finance the development of its A-330 in the KC-X competition.

The World Trade Organization recently ruled that the subsidies are unfair, a decision that EADS is appealing.

Pentagon officials have repeatedly said that the WTO ruling will not factor into the tanker competition, citing the fact that the Defense Department has no guidance from the White House or Congress to do so.

Keating also confirmed that while Boeing currently has every intention to bid on KC-X, "the problem that we're having is; whether or not [the Pentagon] continues to make changes to the [request for proposal] and whether or not we'll be disadvantaged" by those changes.

He went on to say that Boeing CEO James McNerny is "still in the decision-making process" about this.

However, "We will not bid on a proposal that is a loser," Keating added. "If we are so disadvantaged that we cannot win, then [McNerney and the company's board of directors] will not take us down this road ... we have fiduciary responsibility to our shareholders."

[JimWH]

Boeing sound as though they are running scared. I must admit that when I read about the new RFT I presumed that it was written in order to pretty much ensure that Boeing won, but the fact that they are running such a full bore scare campaign suggests that they're in no way certain of a win. Similarly, EADS have been really rather quiet given the amount of crap that Boeing is spouting, which strikes me as the behaviour of a company which knows that it has a very strong hand and doesn't have to play dirty.
This is going to be interesting.

[buglerbilly]

Boeing Statement on Amendment to the FY2011 National Defense Authorization Act H.R. 5136

WASHINGTON | With a recorded vote of 410-8, the U.S. House of Representatives today adopted a bipartisan amendment offered by Reps. Jay Inslee (D-Wash.), Rosa DeLauro (D-Conn.), Todd Tiahrt (R-Kan.), Rick Larsen (D-Wash.), Michael Turner (R-Ohio), and Russ Carnahan (D-Mo.) to the fiscal year 2011 National Defense Authorization Act to ensure a level playing field for the KC-X tanker competition. The amendment requires the Department of Defense to consider any unfair competitive advantage that European Aeronautic Defence and Space Co. (EADS) and its subsidiary Airbus have gained from decades of illegal subsidies. The World Trade Organization recently ruled that Airbus received billions of dollars in illegal launch aid from European governments, including almost $5 billion used to develop the A330, EADS' tanker platform.

Boeing released the following statement on the amendment:

"We fully support the efforts of all members of Congress who share our concern about the unfair competitive advantage that EADS/Airbus, a foreign company, gained from decades of illegal launch aid subsidies worth billions of dollars. We are encouraged by strong bipartisan support for a fair competition on a level playing field. The amendment requires the Department of Defense to take into consideration illegal European launch aid subsidies in bid evaluations for America's next tanker. It is entirely appropriate that these congressional leaders take such steps to prevent the U.S. defense industrial base from suffering the same fate as the commercial aircraft industry, where illegal subsidies have contributed to the loss of tens of thousands of U.S. aerospace jobs."

[pdf27]

Any guesses how this is going to affect the ongoing WTO investigation into the US Government giving contracts unfairly to Boeing to subsidise them? This is getting more and more transparently a fix!

[Chunder]

Any guesses how this is going to affect the ongoing WTO investigation into the US Government giving contracts unfairly to Boeing to subsidise them? This is getting more and more transparently a fix!

Naturally no US defence contractor ever received any money whatsoever from the Government or Pentagon to help develop a product available for FMS...

[buglerbilly]

CRS: Congress Faces Decision Time on KC-X

By JOHN REED

Published: 1 Jun 2010 15:19

The U.S. Congress must decide this year "whether to approve, reject or modify DoD's new KC-X competition strategy" in the current effort to replace 179 of the U.S. Air Force's oldest tankers, according to a May 25 report by the Congressional Research Service.

"Congress's decision on these issues could affect DoD capabilities and funding requirements and the aircraft manufacturing base," according to the report, titled "Defense: FY2011 Authorization and Appropriations."

The report was published two days before the U.S. House of Representatives approved legislation requiring the Pentagon to factor "any unfair competitive advantage" into the KC-X decision. Boeing backers in Congress introduced the legislation to force the DoD to account for European Union subsidies EADS received to start production for its A330 jetliner that its tanker offering is based on. The World Trade Organization recently ruled those subsidies to be unfair.

The European defense giant is competing against Boeing's smaller, 767-based bid.

A similar bill is working its way through the Senate and, if approved there, the bill will become law.

Even if the bill does become law, "it would be virtually impossible for DoD to calculate indirect benefits received by Airbus into a KC-30 bid price," said Teal Group aviation analyst Richard Aboulafia.

[McDethWivFries]

Naturally no US defence contractor ever received any money whatsoever from the Government or Pentagon to help develop a product available for FMS...

sssshhhhh, they dont like it when you point out they also do what they complain about others doing!

[buglerbilly]

Let’s talk about the planes

Note: this is a very long column. (from the Leeham News and Comment, Intelligence for the Aviation Industry)

In a previous post, we lamented that the debate over the KC-X procurement seemed to be about everything BUT the attributes of the planes offered by Boeing (the KC-767 NewGen) and EADS (the KC-45, based on the Airbus A330-200).

The public relations campaign and the shrill political posturing has been about the WTO trade dispute between the US (Boeing) and the EU (Airbus) over illegal subsidies to both companies and whether these should be included in the Pentagon’s evaluation; about jobs; about extending the deadline to submit bids so EADS can do so; and about freezing Obama administration appointments in a particularly snitty move by an EADS Senator.

None of these has anything to do with how the USAF evaluates the plane. The USAF evaluates the equipment on the merits of performance, capabilities, life cycle costs, military construction costs (MilCon) and a bunch of technical requirements, 372 in all.

If the airplanes’ costs come within 1% of each other, another 93 discretionary criteria will be scored, including exceeding capabilities.

The reason we lament the [lack of] quality in the debate is because EADS and Boeing both offer, conceptually, good airplanes. The challenge is that they are essentially two different mission-capable airplanes trying to fit into one mission-capable category and evaluation.

The solution, we have said since the beginning of Round 2 in 2007, is that the USAF should buy both airplanes because they perform different missions and today’s Air Mobility Command and USAF require different capabilities than in the past.

Defense Secretary Robert Gates, of course, says no dual-sourcing and in his mind that should end the debate. Of course, he also says no WTO consideration and that did not end the debate. On the contrary, the debate over the WTO led last week to a vote in the US House of Representatives that WTO findings for all defense programs, for all sides, should be considered in the future. Action in pending in the Senate.

We think this is the wrong policy at the wrong time and for the wrong program, as we have written many times. Furthermore, we also believe there is a possibility Boeing could come to regret what it asks for and finally, there is the possibility that the Congressional action may not have all that much affect on the price issue anyway.

But let’s talk about the planes.

We aren’t going to get into the 372 criteria, but rather some over-arching issues. We’ll try to list advantages and disadvantages of each airplane to spur the discussion that we believe should be taking place, and which are relevant to the Air Force and Warfighter.

Size

There is no question: the KC-767NG is closer in physical size and fuel offload to the Boeing KC-135 than is the EADS KC-45.

In the Round 2 competition, Boeing issued illustrations over-laying the dimensions of the KC-767 on the KC-135 and the KC-30 (as it was then known) over both.These were effective illustrations that demonstrated just how much bigger the KC-30 is over the KC-135.

While the KC-767 and the KC-30/45 both require MilCon infrastructure improvements and more capable ground equipment than the KC-135, EADS likes to point out that the difference is the “delta” between the two in evaluating costs. We acknowledge this and note that outside the military, we don’t there are many if any people who have a real handle on how much MilCon will cost to accommodate either the KC-767 or KC-45. But the point is valid and one we thought Boeing failed to capitalize on in the 2008 competition (and so far, in this one).

Boeing Commercial Aircraft has a comprehensive airport-requirement section on its website to tell customers what is needed to support and service Boeing airplanes. Naturally the site doesn’t have Airbus airplanes on it, but we imagine BCA salesman have some kind of information on this.

We suspect that from a commercial standpoint, BCA has run all kinds of analysis for its airline sales team so they can make financial arguments of infrastructure requirements for Boeing vs Airbus. Absent information from the military, the commercial comparisons are a logical one.

Boeing Defense should run these calculations and estimates and use these in their advertisements and public relations campaigns. If their limited statements on this topic are to be believed so far, this number might be significant. If it is, then we think Congress–for whom all these PR, political and advertising campaigns are targeted anyway–might find the data worthwhile.

Airbus actually provided a great illustration during its Innovation Days to conceptually grasp the difference in airplane sizes.

Airbus was talking about the A330-300 and the advantages officials say the airplane has over Boeing’s 777-200ER in size and fuel economy.

Here is the illustration from Airbus, demonstrating how much lighter the A330-300 is compared with the 777-200ER.



We thought this was pretty effective. (This also illustrates why, among other reasons, Boeing was unlikely to offer a KC-777, given the difference between the 777-200 on which a KC-777 would be based and the A330-200.) So we did a little calculating of our own and crudely put together this illustration to demonstrate how much lighter the 767-200ER commercial model is than the A330-200HGW: the equivalent of the maximum take off weight of a McDonnell Douglas DC-9-50.



We can’t imagine the infrastructure costs delta will be 1%, a critical figure described previously.

On MilCon costs, the advantage ought to be Boeing’s. Why not talk about this?

Life Cycle Costs

This is an area where Boeing has the clear advantage; even EADS/Airbus (and, previously, Northrop Grumman) acknowledge this. The question has been over how great the advantage is.

During the 2008 competition, Boeing used the figure that the Boeing 767-200ER has a 24% fuel burn advantage over the A330-200. This number has been repeated in early press releases in this round. The figure comes from data filed by US airlines with the US Department of Transportation.

Airbus claims the difference is just 6%, but the company has never shown us the data to support this claim, nor has the company shown how the DOT data is incorrect. But that’s what the company claims.

Let’s give Airbus the benefit of being correct on this for purposes of this discussion. Six percent is still 6%, and when engaged in a price shoot-out where the low-bid wins, or where the competitors have to come within 1% before extra credit is given, 6% may as well be 24% or 124%; it ain’t 1%.

Furthermore, Boeing proposes putting winglets on the KC-767. On commercial 767-300ERs, the winglets have proved to lower fuel burn by 3.5%-4.5%. Add this to 6% and now the fuel cost advantage is about 10%. Add this to 24% and the advantage is about 28%.

And there isn’t a thing Airbus can do about it. Winglets aren’t available for the A330. (Update, 0930 PDT: We got a quick email from EADS pointing out the A330 already has winglets, which is true. But Airbus is putting a new-design winglet on the A320 family, which improves fuel burn by about 4%, and this solution isn’t available for the A330. This is what we mean when we say there isn’t anything Airbus can do about matching Boeing’s 767 winglet solution.)

Life cycle costs also include maintenance costs, parts, spares, etc., for which we don’t have data to make comparisons. There has been interesting Comment discussion on these items in previous posts the Reader can seek out, but for which we can’t begin to assess for accuracy. So we will stick with fuel.

With or without winglets, the life cycle cost on fuel burn on the KC-767 is better than the larger KC-45–and EADS knows it.

Advantage: Boeing. Why not talk about this?

Capabilities

This is one of those areas where the definition matters. Which airplane is more “capable”?

If you are talking about the ability to fly farther with greater fuel payload, great cargo payload and greater troop-carrying payload, and the ability to off-load more fuel, the answer is clearly the KC-45.

But are these greater capabilities needed?

In the 2008 competition, the USAF came to the conclusion the answer was “yes.” Readers will remember the famous line, the then-named KC-30 offered “more, more, more,” the USAF said in selecting the airplane.

The 2009 competition says “more” isn’t that important. The RFP uses the KC-135 as the baseline and if the contenders meet the baseline requirements, the low-priced airplane wins. Only if the prices are within 1% of each other with “more” be considered.

On this basis, the KC-767 has the advantage. It’s smaller than the KC-30/45. Boeing says it meets the baseline requirements. The pricing theoretically should be better. (More on this below.)

Advantage: Boeing.

Price

We’ve made a couple of references already to the importance of price. In the 2008 competition, Northrop Grumman submitted a bid of $184m per airplane. Published reports had put this number at about $172m, which was said to be about $12m-$15m less than Boeing. This suggested the Boeing bid was $184m-$187m. The subsequent GAO report upholding Boeing’s protest noted that absent the additional costs assessed by the USAF for risk factors (plus $5bn for Boeing, plus $772m for Northrop), the bids were essentially even.

This demonstrates why Boeing is so focused on getting the WTO finding about illegal Airbus subsidies into the equation. Boeing and its supporters assert the WTO found the A330-200 on which the KC-45 is based received $5.7bn in illegal subsidies. Spread over 1,086 airplanes ordered so far, this is $5.25m per plane Boeing believes should be added to the EADS bid price.

Let’s take this at face value.

Northrop said it bid $184m. This includes the Northrop mark-up and profit margin, which defense consultant Michel Murluzeau of G2 Solutions in Kirkland (WA) estimates to be 10%-15%. This Flight International Special Report on the tanker includes this observation. Thus, subtracting these percentages, you get the following bid price assumptions (using the 2008 numbers), in thousands:



So even adding back in the WTO penalty still provides a low price for Boeing to beat, lower than was bid in 2008.

Then take into consideration the lower Euro-to-Dollar exchange rate and Boeing’s uncertain development costs of the KC-767 NewGen–and finally, the prospect that Boeing will likely be found guilty of receiving illegal subsidies. Thanks to the legislation passed by the House last week, Boeing may well find itself faced with the prospect of these subsidy costs being added back into its bid price.

We talk in detail about these factors in this post.

Boeing’s Jim Albaugh, CEO of Boeing Commercial Airplanes, was CEO of the Defense unit in 2008. The major portion of the cost of the KC-767 comes from BCA. At the time, Scott Carson was BCA CEO, and we were told after the GAO protest was filed that Carson had not been willing to cut Boeing Defense a low price for the 767-200ERF (a conceptual airplane) needed by Albaugh at Defense. Now that Albaugh is at BCA, he has vowed not to be the person who loses the tanker competition twice and we expect him to be more aggressive on price than was Carson.

Boeing is also switching the 767 production line to a Lean line, which will reduce costs significantly.

Still, Boeing doesn’t truly know what its development costs will be since it is offering a conceptual airplane based on the troubled Italian tanker program, where structural and aerodynamic problems still have to be resolved before the airplanes can be delivered. These are now four years late.

EADS, with KC-30s in production, says it knows what its development costs are–there is less risk and greater certainty on a bid price for EADS compared with the Boeing challenge, EADS contends.

And the USAF fixed price component of the USAF contract worries Boeing (as it did Northrop). Because Boeing doesn’t have a good track record with the KC-767 International program and because it is offering a conceptual airplane that isn’t in production, the cost risk to Boeing has got to be high. Remember, the USAF added $5bn in 2008 to Boeing’s cost for these reasons. (This is not possible under the 2009 RFP.)

Boeing, as recently as May 20, reiterated its concern over fixed price and said it must prepare a “financially responsible” bid. Boeing even floated the idea that it might not bid, though it subsequently said it “INTENDS” to bid (emphasis is Boeing’s).

To use the apt analogy, What is the bottom line on price?

We think that even allowing for the WTO finding, EADS may well have the advantage on pricing.

Advantage: EADS

Past Performance

In 2008, past performance was a discriminating criteria and Boeing was marked down significantly because of the International tanker program. Past performance isn’t a discriminating factor in this round, although Evaluation Notices from the Air Force can accomplish much the same thing.

Boeing doesn’t have an in-production airplane and EADS does, which officials say is a major advantage. But the KC-30 is two years late to the launch customer, the Royal Australian Air Force. EADS, and the RAAF, acknowledged that six months of this was due to customer-requested change orders. This means the balance of the delay is due to EADS.

Last month, we asked the RAAF about some of the issues. Here is the e-mail interview, with answers provided by a spokesperson with the Australian Defense department.

1. We understand that the MRTT will now be two years late in delivery to RAAF. What is now the targeted delivery date, please?

Defence expects to achieve delivery of the first two aircraft by end-2010.


2. We understand that there continues to be issues with the aerial refuelling boom, specifically flight envelop issues. Please detail what these issues are and how these are delaying delivery.


The delay to delivery is primarily due to the additional time required for the conversion and testing of the whole of the military modifications for the first-of-type A330 MRTT; not the boom refuelling system per se. Airbus Military has now completed important milestones in the final testing of the military avionics, underwing pod and boom refuelling systems. A Supplemental Type Certificate for the A330 MRTT was granted by the European Aviation Safety Agency on 17 March 2010 for civil certification of the military modifications to the commercial A330 airliner. Military certification and qualification testing is currently underway, including final testing and certification of the performance of the new boom refuelling system. Based on the substantial testing conducted to date, the DMO does not anticipate that the boom will delay delivery and entry into service of the A330 MRTT.


3. Please identify any other issues with the MRTT that have to be resolved prior to delivery.


The test program is now entering the final certification and qualification stages after over 12 months of developmental testing of the new military avionics and refuelling systems. At this stage of the program, there are no known technical issues that are anticipated to impact the completion of the military certification and qualification program.

When we were at the Airbus Innovation Days, a spokesperson for Airbus Military advised us that the two aircraft will be delivered in the third and fourth quarters. One of our peers attending the briefing was an Australian defense reporter, who says he has been told by a high-level RAAF source that there remain flight envelope issues with the refueling boom. Readers can see we asked RAAF about this (above) and the response. The Airbus Military spokesperson denied the report as well.

Conclusion

With this column, we have on a macro level tried to talk about the airplanes. To summarize, we think:

•Boeing has a clear advantage on life cycle costs;
•Boeing has the advantage on MilCon costs, probably beyond 1%;
•Boeing has the advantage on the basic RFP requirements;
•Boeing’s Jim Albaugh now runs BCA and knows what price is needed to win;
•Boeing is going to a Lean production 767 line which will provide significant help on costs;
•Boeing has a great advantage with the in-place production at Everett and a highly skilled IAM workforce (we think this is one of Boeing’s best talking points, by the way);
•EADS may have the advantage on price, despite last week’s vote by the US House of Representatives;
•EADS has the advantage of an in-production airplane, leading to greater certainty on cost than Boeing has;
•Evaluation Notices can take into account risk and past performance factors, though not to the extent of the 2008 competition;
•Boeing is disadvantaged by its past performance;
•Boeing is disadvantaged by risk factors relating to offering a conceptual airplane;
•EADS should be marked down in the ENs for delays to Australia;
•EADS is disadvantaged by its proposed “greenfield” production site at Mobile (AL) (the weakest link in the EADS proposal);
•EADS is at a great disadvantage over life-cycle costs;
•EADS is disadvantaged over MilCon costs;
•We think EADS may not be able to overcome the life-cycle and MilCon cost disadvantages;
•Politically, EADS is at its greatest disadvantage.

A final word:

If the Senate concurs with the House and requires the Air Force to take into account the WTO findings on Airbus (and Boeing), and should per chance EADS still win on price (including life cycle and MilCon costs) and meeting the 372 pass-fail requirements, there will be no excuses Boeing and its supporters will logically be able to fall back on to protest this award. (Unless the USAF screws up yet again in the evaluation process, an outcome that can’t be ruled out.)

Boeing could still wind up being hoisted on its own petard. For all the effort to get the WTO factors considered, our analysis suggests it is a long shot that EADS could still win on price, but it might. Boeing is certainly worried EADS could. And that’s the ballgame.

[buglerbilly]

Boeing Welcomes Proposed U.S. Bill On Refueling Tanker Bid

AGENCE FRANCE-PRESSE

Published: 4 Jun 2010 10:16

SINGAPORE - Boeing on June 4 welcomed proposed U.S. legislation that would force the Pentagon to factor in subsidies to Airbus when it makes a decision on a $35 billion tanker contract.

The American giant is locked in a fierce battle with European rival Airbus for the deal to supply new aerial refueling tankers to the U.S. Air Force, with both sides trading accusations of unfair competition.

Dennis Muilenburg, the president and chief executive of Boeing Defense, Space and Security, said the company thinks "it's very important on the global scale that we have a fair and level playing field."

Speaking to reporters in Singapore where he was attending a security forum, Muilenburg referred to a ruling by the World Trade Organization (WTO) that Airbus had received "illegal subsidies" from European governments.

US lawmakers last month proposed a bill that would require the Department of Defense to consider WTO decisions as part of military acquisitions.

Supporters have said the bill would require the Pentagon to add five billion dollars to the cost of the Airbus bid for the contract.

"The legislation as you see is intended to address the fact that right now we don't have a level playing field," he said.

"Boeing is very interested in competing, we are very willing to compete in the global marketplace but we also want to compete on a fair and level playing field."

The legislation has drawn fire from the European Aeronautic Defence and Space Co (EADS), the parent of France-base aircraft maker Airbus.

"The Boeing Bill is one more attempt to avoid competing on the merits of the tanker," Guy Hicks, spokesman for the EADS unit, said in a statement last month, alleging Boeing did not have a tanker that met contract requirements.

But Muilenburg said June 4 that Boeing has been "building and delivering" tankers for the past 50 to 60 years and was now "in the final stages of preparing" its proposals for the latest U.S. contract.

The Pentagon expects to make a decision in the autumn. The process has been dragging on since 2003.

EADS rejoined the bidding in April for the contract to supply the U.S. Air Force with 179 aerial refueling tankers.

The European company and its former U.S. partner, Northrop Grumman, had earlier dropped out of the process, complaining the Pentagon had skewed the contract terms to favor Boeing.

Proposals from each firm are due by July 9 to replace an ageing fleet of Boeing KC-135 Stratotankers that date back to the 1950s.

In March, the WTO issued a confidential ruling on U.S. allegations that European governments had illegally subsidized Airbus, part of a long-running subsidies battle between the U.S. and the European Union.

[buglerbilly]

DOD Buzz

EADS Mum on U.S. Tanker Partner



By Greg Grant Friday, June 4th, 2010 11:06 am

EADS has found a U.S. partner for the tanker competition, they’re just not saying who it is, according to the Financial Times.

The European aerospace firm had been in talks with L-3 Communications, but once word leaked of the potential partnership, lawmakers on Capitol Hill twisted arms and the U.S. company backed out, EADS chief Louis Gallois told reporters in London.

“We perhaps made a mistake to announce L-3. Putting it on the radar screen was not very good. This time we prefer to be more quiet. You read what Norm Dicks said. It’s public. He said, ‘I hope that US suppliers will not go with EADS.’ I think it’s a kind of pressure,” the article quotes Gallois as saying.

Boeing supporter and top defense appropriator Rep. Norm Dicks (D-Wa.), told U.S. companies not to team with EADS against Boeing for the $35 billion tanker contract. If it wins the contract, Boeing plans to partially build the new tankers in Everett, Wa., located near Dicks’ congressional district.

Read more: http://www.dodbuzz.com/2010/06/04/eads-mum-on-u-s-tanker-partner/#ixzz0pwMOht87

Comments are interesting, people are getting a bit peeved by the bias...................

Mr. X · 9 hours ago


Why is Rep. Norm Dicks even allowed to be in this position in the first place????!!!! It's clear he is doing anything in his power to make sure Boeing wins and if you do not think Boeing isn't lining his pockets with cash than you need your head examined.


Mrs. Y · 8 hours ago


The people of Washington elected Norm Dicks, and then he kissed enough ass to become the "top defense appropriator."


SMSgt Mac · 2 hours ago


Can anyone imagine under any circumstance involving any defense contract other than this one where it would be the least bit acceptable to bully an American defense contractor into not teaming with a foreign company for a contract? Remove either of two key players: Boeing or the delightfully-named Dicks. And this would be impossible.


Read more: http://www.dodbuzz.com/2010/06/04/eads-mum-on-u-s-tanker-partner/#ixzz0pwN1bX9M

[Chunder]

I've read some of SmSgt Mac's post in the distant past, it's good to see he's still out there lippin' off.

[buglerbilly]

Ares

A Defense Technology Blog

Italy Also Hops into Bed with Boeing on Tanker Program

Posted by Christina Mackenzie at 6/7/2010 4:27 PM CDT

Well now, isn't this a strange thing. The very day that AgustaWestland's mother company Finmeccanica announces that it has reached an agreement with Boeing for the U.S. Navy's Presidential helicopter program (as posted earlier by Bettina), it also announces that another of its subsidiaries - DRS Technologies - has signed a teaming agreement with Boeing for the NewGen Tanker program. DRS will collaborate with Boeing on the console design and then manufacture the Aerial Refueling Operator Station (AROS) and provide the interconnect design and associated cable sets to integrate AROS into the Tanker.

All this contingent, naturally, upon Boeing winning the contract from the US Air Force. DRS has produced and integrated global transport tanker aircraft Remote Aerial Refueling Operator Consoles, cables and harnesses for Boeing since 2006.

And just to add some Italian input to Bettina's post : Pier Francesco Guarguaglini, Finmeccanica's CEO remarked that his company and Boeing had enjoyed a “long and successful history spanning over four decades,” and that Finmeccania had “made a strategic decision to work with Boeing because it is the best solution for the VXX competition.”

Giuseppe Orsi, CEO of AgustaWestland added that “there are many reasons why it [the AW101] won the first time around.” Despite Boeing now holding the intellectual property, data and production rates for the helicopter, AgustaWestland says it will keep a role in developing the program “and will be awarded a significant part of the basic helicopter production.”

[buglerbilly]

DATE:09/06/10

SOURCE:Flight International

Boeing: next-generation boom on track for KC-X tanker deadline

By Ghim-Lay Yeo

Boeing has demonstrated the next-generation boom technology included in its offering for the US Air Force's KC-X tanker competition, and says it is on track to meet the 9 July deadline for bids.

"We have a great deal of confidence in that technology," says Boeing Defense, Space and Security chief executive Dennis Muilenburg. "We demonstrated the capabilities. It is a next-generation boom with fly-by-wire and it is ready for the tanker schedule."

Muilenburg declines to reveal more details about the company's 767-based NewGen Tanker, but says the offering includes "technological insertions from other programmes", such as the 787 cockpit.

Boeing is also drawing on lessons learned from the tankers it has developed for Japan and Italy, says Muilenburg.

Japan has taken delivery of its four 767-based tankers, and its feedback has been "positive", he adds. Italy's acquisition of four KC-767s has been delayed from an original scheduled delivery in 2007, but Muilenburg expects the nation to receive its first example soon.

"We are ramping up the technical development work. The next step of the process is the tender for acceptance, that's the formal process of accepting the aircraft into the fleet. We are entering that process this summer," he says. "I see that programme now moving along in a positive manner."

Japan and Italy's tanker acquisitions have given Boeing confidence in the USAF KC-X competition, adds Muilenburg.

"Certainly, we have a lot of lessons learned and a lot of risk reduction that has been accomplished for both of those and all of that is being rolled into our US tankers competition," he says.

"The fact that we do have 767-based tankers that have been delivered and are now in operation, including those in Japan, gives us confidence in the underlying platform. And we're adding capabilities that are required, that are unique for the US competition."

[buglerbilly]

USAF Tanker Award Now Slated for 'Mid-November'

By JOHN REED

Published: 18 Jun 2010 15:38

The Pentagon now expects to award the $35 billion KC-X award in "mid-November," the U.S. Air Force's top uniformed acquisition official told reporters June 18.


Pentagon spokeman Geoff Morrell said the DoD is not delaying the award of the tanker contract to replace the aging KC-135. (STAFF SGT. ROBERT BARNEY / U.S. AIR FORCE)

"Planning figures lead us to" anticipate a KC-X contract award in the "mid-November time frame," said Lt. Gen. Mark Shackelford during a June 18 briefing with reporters at the Pentagon.

This news comes after claims by Pentagon officials that the award date would not change from "early fall" despite the fact that the Defense Department granted EADS a 60-day extension to respond to the KC-X request for proposals so the European defense giant could put together a solo bid.

In late March, Pentagon Press Secretary Geoff Morrell told reporters that the DoD would accelerate its evaluation of the bids to stick to the original contract award schedule of early fall 2010.

On April 29, the Pentagon modified the KC-X request for proposals (RfP0, crossing out the term "contract award date" set for July 16 and replacing it with the term "contract start date" slated for Nov. 12.

On May 4, Morrell vehemently denied that this meant the contract award date was being pushed back.

"In the RfP, there's a contract start date - not to be confused with the contract award date," Morrell said.

He said that the term "start date" an arbitrary target that both companies should build their master schedule around.

"Frankly, we could award it well before then, or we could award it potentially after then. But when you build your plan for submission, build it with that as the start date," he said.

Morrell elaborated in an e-mail message: "We are not delaying the award of the Tanker contract. … Our plan has always been to award the KC-X contract in the fall of 2010."

The original deadline for EADS and rival Boeing to submit their bids was May 10; bids are now due July 9.

EADS asked for the extra time after its erstwhile partner and U.S. prime contractor in the effort, Northrop Grumman, pulled out of the contest earlier in the spring.

EADS is offering a tanker version of its Airbus A330 jetliner while Boeing is bidding an upgraded version of its smaller, 767 jetliner equipped with the glass cockpit of the 787 Dreamliner.

[buglerbilly]

Senator Pushes EADS Subsidy Issue in U.S. Tanker Battle

By JOHN REED

Published: 30 Jun 2010 16:22

The U.S. senator helping to spearhead the Senate effort to force the Pentagon to factor subsidies received by EADS when selecting the KC-X tanker winner said June 30 that he plans to move forward with legislation to influence the $35 billion competition that wraps up this fall.


Sen. Sam Brownback said that he hopes to see language requiring the Pentagon to account for roughly $5 billion in subsidies EADS received to develop the Airbus A330, the plane that the EADSs tanker offering is based on. (Agence France-Presse)

Sen. Sam Brownback, R-Kan., said that he hopes to see language requiring the Pentagon to account for roughly $5 billion in subsidies EADS received to develop the Airbus A330, the plane that the European company's tanker offering is based on.

"I would hope we can look for it in the next available bill," Brownback told Defense News following a press conference on Capitol Hill to discuss the results of a World Trade Organization (WTO) ruling. Those results, publicly released that morning, determined EADS received billions in unfair launch aid for its commercial aircraft that resulted in Boeing losing significant market share around the world.

The senator could not guarantee the language would be included in the final version of the 2011 defense authorization bill, which the White House has threatened to veto as it currently stands.

However, the senator remained optimistic that he could find another "must-pass" piece of legislation requiring the Defense Department to account for the subsidies.

"I'd like to see it on another must-pass piece of legislation," said Brownback. "Maybe on a jobs bill or something of that nature."

The president and Pentagon adamantly oppose the inclusion in the authorization bill of roughly $480 million for the continued development of the F136 alternative engine for the F-35 Lighting II Joint Strike Fighter.

On May 27, the U.S. House of Representatives voted 410 to eight to add a clause to the bill requiring the Pentagon to factor in the price of unfair government subsidies when it conducts weapon buys.

Brownback was joined by Sens Maria Cantwell, D-Wash., Patty Murray, D-Wash., Pat Roberts, R-Kan., Christopher "Kit" Bond, R-Mo., and Reps. Jay Inslee, D-Wash., Norm Dicks., D-Wash., Todd Tiahrt., R-Kan. and Don Manzullo, R-Ill.

All of the legislators described the day as a victory for Boeing and the U.S. in its effort to "level the playing field" in large aircraft competitions around the globe. They repeatedly stressed that the Pentagon must now factor the subsidies into the competition.

Tiarht went so far as to threaten to withhold funding for the airplane if the DoD fails to heed congressional concerns on the matter.

"We can withhold the funds, Congress has the purse strings; it's the will of congress that [DoD] takes this into consideration," Tiarht told Defense News after the press conference.

However, unlike Brownback, Tiahrt added that he believes the defense authorization bill can indeed make it to law "this summer" since the president does not have line item veto authority over the bill.

Still, one Boeing official familiar with the matter said that while he doubts the authorization bill will be signed into law before the KC-X deal wraps up, the mere fact that Congress has taken such an intense interest in the matter sends a clear message that the Pentagon should take the subsidies into account.

While the WTO ruling determined Boeing has lost market share around the globe in double-digit percentage points to Airbus, it did not find that the company was necessarily forced to cut jobs as a result, according to Tim Reif, general council to the U.S. Trade Representative, who was speaking during a June 30th press conference to discuss the ruling.

This is because a global uptick in aircraft orders during the period the WTO investigated bouyed Boeing's work force, according to Reif and Boeing.

However, the lost market share no doubt contributed to lost profits and lost jobs, according to officials from Reif's office, the lawmakers and the Boeing officials.

European officials have threatened to appeal the ruling, a process expected to begin in late July and to take 90 days after that to resolve.

EADS officials fired back June 30 at the lawmakers' effort to tie the WTO ruling, which was the result of a case regarding civil airliners, to the KC-X competition.

"The Obama Administration and Department of Defense have opposed every attempt to use the ongoing WTO commercial trade dispute to derail the KC-X competition," said EADS spokesman Guy Hicks in a June 30 e-mail. "The only beneficiary of such a noncompetitive action would be the Boeing Company. Everyone else - the warfighter, the taxpayer and 48,000 Americans who stand ready to build the KC-45 - would lose."

[buglerbilly]

DATE:01/07/10

SOURCE:Flight International

Who won at the WTO?

By Murdo Morrison

The World Trade Organisation's final report into state subsidies to Airbus raises two key questions: who won, and what effect will it have on the way the European airframer's multi-billion dollar programmes are funded?

There is a third: will the ruling - published on 30 June - derail Airbus parent EADS's attempts to sell its A330 tanker to the US government, whose Office of the US Trade Representative initiated the WTO investigation in 2004, or compete in future Department of Defense contests.

Surprisingly, given the emphatic way both sides claimed victory, or vindication, neither of the first two are clear. Although the USA has triumphed in at least some of the crucial legal arguments, what that means for the competitive landscape is uncertain.


© Airbus Military

As far as the KC-X tanker contest is concerned, it is evident that Boeing's supporters in Congress, the unions and the media will step up their campaign - begun when the WTO's interim findings emerged last September - to stop the US military choosing a foreign supplier they claim has been able to challenge a domestic rival only as a result of unfair subsidies. Indirectly, that could be the biggest punch Boeing has landed on its opponent.

Given the extent to which details of the report have already emerged in recent months, the report's content contained few surprises. Essentially, the WTO panel investigating the case has found that a series of loans to Airbus over the years, including reimbursable launch aid for the A380 and other infrastructure grants, did break international trade rules enshrined in the so-called Subsidies and Counterveiling Measures (SCM) agreement. However, crucially the WTO rules that A350 launch aid - agreed after the case began in 2004 - has not so far been illegal.

The Geneva-based organisation - an umpire in trade disputes - also finds that the effect of the subsidies constituted "serious prejudice to the interests" of the USA in terms of it being able to sell its exports in Europe and other world markets.

Implications for KC-X and EADS's US defence prospects

Boeing's political supporters in Congress - most of them from states in which the airframer or its suppliers have an industrial presence - seized on the initial findings as evidence for banning EADS (which originally partnered Northrop Grumman) from the KC-X competition, and stepped up their campaign following the report last week.

Although the administration has always been careful to keep the arguments separate, pressure will mount on President Obama to opt for a solution that preserves the most American jobs at a time of high unemployment. EADS argues that the "only beneficiary of such a non-competitive action" would be Boeing. The losers, it claims, would include, the US military, the taxpayer and 48,000 Americans who would be employed building and supporting the A330-based tanker.

Massive federal bail-outs and loan guarantees for US auto makers and other industries following the banking crisis - although admittedly not for aerospace - has also weakened the moral case against government subsidies.

It recommends that all prohibited subsidies should be withdrawn within 90 days.

However, importantly but rather confusingly, the WTO says the USA has failed to establish that the effect of the subsidies led to "significant price undercutting" or "significant price depression" by Airbus, and that the funding caused "injury" to the US aerospace industry.

Not surprisingly, Airbus and Boeing put very different spins on the findings and what should happen now. Boeing chief executive Jim McNerney hailed the report as "a landmark decision and sweeping legal victory over the launch aid subsidies that fuelled the rise of Airbus and that continue to provide its products a major cost advantage", adding: "We now join the US government in urging full compliance with the ruling and a permanent restoration of fair competition within our industry."

Airbus retorts that the WTO has rejected seven in 10 of the US claims and that the panel agreed that subsidies did not cause "material injury" to Boeing in terms of lost jobs or profits.

What happens now is also uncertain. Boeing is unstinting. "Airbus must repay $4 billion in illegal launch aid it received for the A380 or restructure the A380's financing to proven commercial terms," it says, also warning that Airbus must not resort to illegal subsidies to finance the A350. Although it expects Europe to appeal against the ruling, it says that process should be concluded by the end of 2010.

Airbus, however, expects the dispute to "continue for a few more years", partly because of Europe's corresponding case against alleged illegal subsidies to Boeing, which a separate WTO panel is expected to report on later this year, and has called again for both sides to negotiate a new agreement to replace the 1992 deal.

"Only the availability of the report on the parallel case will bring the necessary balance to allow for a possible start of negotiations, without any preconditions," says the airframer, adding that "resolution will finally only be found in transatlantic or even multilateral negotiations".

Those multilateral negotiations could be key. The glacial pace of the deliberations so far have meant that the investigation has not kept up with the changing business landscape. Since the lawyers got to work in 2004, Airbus has launched the A350 and Bombardier the CSeries while the Chinese are developing the Comac C919. The Russians, Chinese and Japanese all have regional jet programmes.

Ian Godden, chairman of UK trade body ADS, says it is "sad" that industries in the West are "distracting themselves with an internal dispute, while countries elsewhereare developing competitor aircraft", all with state support. "The trade dispute has the potential to tie up existing market leaders while such newcomers take market share," he adds.

Ian Giles, an aviation lawyer at London-based law firm Norton Rose, who has been following the case, says the ruling represents a defeat for Airbus "but it is a long way from the end of the story".

He adds: "Airbus has already said it does not believe the ruling impacts on funding plans for the A350 - Boeing clearly do not agree, and so another chapter in the dispute is likely to be played out before the WTO. As has been the case throughout this dispute, both sides are trying to portray the WTO ruling in their favour.

"For Boeing, the WTO finding that the interest rates granted by the EU governments were so far below market rates as to be illegal is a positive, while for Airbus, the finding that these type of state-backed loans are not per se illegal will give them hope that they can restructure the funding with minimum disruption. Also several of the US claims as to specific measures being illegal were rejected."

No one should expect a quick resolution to the dispute, he says. "The WTO ruling has to be seen as part of a wider political negotiation. The EU is not going to bow to this ruling without similar compromises from the USA, and the scope for countersuits before the WTO is far from exhausted. You get a sense of perspective on this dispute when you realise that there are still arguments before the WTO about the relevance of data from the 1960s. This still has a long way to run."

THE BACKGROUND TO THE DISPUTE

Airbus and its European "home" nations - France, Germany, Spain and the UK - have always been open about the fact that the airframer's programmes have been supported by the taxpayer since the consortium began building aircraft in 1970.

Created as an attempt to consolidate Europe's small national airliner manufacturing assets - most of them government-owned - into a rival for the USA's then big three, Airbus took many years to be taken seriously by Boeing.

However, by the 1990s, with its A320 family selling strongly and the A330/A340 making inroads into the long-haul market, Airbus's market share was creeping up on Boeing - by that time the only other big aircraft manufacturer.

A "gentleman's" agreement between Europe and the USA in 1992 - which set out ground rules for state funding of aircraft - was abandoned unilaterally by the USA in 2004 following Boeing pressure. This was just as Airbus was overtaking its rival for the first time and clocking up orders for the A380, a hugely ambitious, expensive and risky programme supported by reimbursable launch aid from European governments.

After the USA pushed the WTO to investigate the subsidies, Europe in turn filed a counter case, claiming that US federal research and technology grants and funds from individual states represented illegal subsidies.

The first panel hearing in the USA versus Europe case took place in March 2007, with the parallel European-initiated process kicking off that September.

Airbus's case has always been that every piece of launch aid it has received has been borrowed on comparable terms to the market, and paid back to lenders with interest, arguing that investing in the company has been a lucrative investment for governments.

The USA has argued that subsidies distort the market by allowing Airbus to fund riskier programmes with state guarantees against failure.

[buglerbilly]

In KC-X Twist, Ukrainian Aircraft Maker, U.S. Aerospace Readying Bid

By JOHN T. BENNETT

Published: 2 Jul 2010 06:24

A California-based aerospace firm is finalizing plans to partner with a Ukrainian aircraft maker to pitch up to three aerial tankers in the U.S. Air Force's multibillion-dollar KC-X competition.


A source said U.S. Aerospace and Antonov plan to enter the four-engine AN-124-100, and a two-engine variant of that airframe known as the AN-122. (ANTONOV ASTC)

U.S. Aerospace, Inc. and Antonov executives inked a pact on July 1 spelling out the terms of a partnership under which the American company will act as the prime contractor of a team that will enter up to three Antonov aircraft into the high-stakes KC-X race, an industry source said.

Boeing is expected to enter a 767-based aircraft, and its arch-rival Airbus plans to pitch a tanker based on its A330. The U.S.-Ukrainian partnership likely will send ripple waves across the global defense sector. All bids are due July 9.

The source said U.S. Aerospace and Antonov plan to enter the four-engine AN-124-100, and a two-engine variant of that airframe known as the AN-122.

In a further twist, the U.S.-Ukrainian team plans to enter "a new plane designed to meet the [KC-X] specs, dubbed the AN-112," the source told Defense News.

The AN-112 would be, if eventually entered, the only plane in the race designed specifically for the Air Force's tanker requirements.

The source said U.S. Aerospace and Antonov formally notified Pentagon officials on July 1 of the team's intention to bid. At the time of this posting, the Pentagon had yet to respond to an inquiry.

Under terms of a "strategic cooperation agreement" signed July 1 in Kiev, Ukraine, "final assembly" of an U.S. Aerospace-Antonov tanker would take place on U.S. soil. Defense News obtained a copy of the agreement. The American company would oversee that stage of production.

U.S. Aerospace would coordinate the bidding process, negotiate with the Air Force, coordinate with subcontractors, ensure conformity of aircraft to requirements of RFP for KC-X Tanker Modernization Program," according to the agreement.

Antonov would integrate components into the aircraft, work with its U.S. partner on preparing the aircraft for certification and testing, and "manufacturing and delivering to [U.S. Aerospace] specified aircraft and components," states the pact.

The cooperation agreement is exclusively for the KC-X competition.

The agreement bears the signature of Charles S. Arnold, senior adviser to the U.S. Aerospace board of directors. It also bears another signature reserved for a senior Antonov official, but that typed name has been redacted. The signature is visible, but illegible.

U.S. Aerospace has offices and production facilities in Santa Fe Springs and Rancho Cucamonga, Calif. A company fact sheets state the firm has done business with and provided components to the Pentagon, U.S. Air Force, Lockheed Martin, Boeing, L-3, General Electric, and other aerospace and defense firms. The fact sheet states the company supplies "structural aircraft parts" to the military's P-3 fleet, as well as Boeing's 747 program.

The California-base company is "engaged in the production of aircraft assemblies, structural components, and highly engineered, precision machined details," according to its website. It also manufactures and re-manufactures aircraft engine and landing gear components.

Antonov, also known as Antonov Aeronautical Scientist/Technical Complex, is a state-owned firm. It is the manufacturer of the world's first and second largest planes, the AN-225 Mriya and AN-124 Condor strategic airlifters, according to a company fact sheet. Antonov also makes the AN-148 and AN-158 commercial airliners.

"Each Party shall bear its own costs and expenses incurred through the performance of this [agreement] except as otherwise agreed in writing between the parties," the pact states.

This is the second time this year word of a second non-American aircraft entrant has shaken up the KC-X race. For several days in March, it appeared Russia's United Aircraft Corp. planned to enter the competition with an unnamed U.S. partner. While sources provided official-looking legal documents to support that, the firm denied any intention to bid.

At that time, U.S. defense analysts dismissed the since-scuttled UAC aircraft, saying even if the company made good on its alleged intentions to chock a modified Il-96 four-engine airliner full of U.S. components, the Soviet-era plane was not advanced enough to compete with - much less outperform - Boeing's KC-767 or Airbus' A330.

[buglerbilly]

Ares

A Defense Technology Blog

Antonov in USAF Colors ... View With Skepticism

Posted by Amy Butler at 7/2/2010 8:47 AM CDT

A California-based company called U.S. Aerospace has filed papers with the U.S. Securities and Exchange Commission to lead a bid of Ukrainian state-owned Antonov aircraft for the U.S. Air Force KC-135 replacement program, estimated to be worth up to $35 billion.

This would pit this odd couple against Boeing, with a 767, and EADS proposing the A330.

The papers were filed July 1, and the company says it anticipates proposing three aircraft, the AN-124-KC, AN-122-KC and a to-be-defined AN-112-KC. It says the company is shooting for a low price.It is unclear whether this means a single bid of multiple platforms, or three bids. Bids are said to take hundreds of millions of dollars to craft.

But, filing papers and crafting an RFP are totally separate things. More competition is better, but it is unclear how the company plans to provide a responsive RFP in such a short time. Bids are due July 9. One of the challenges in making a bid is complying with the IFARA operating scenarios, which take time and expertise to run. These are used to understand how well the aircraft will perform in various settings.

A call to the company was answered by a kindly gentleman who greeted with: "New Century," which refers to the company's remanufacturing business. He referred me to another number, and a receptionist mentioned that the office was empty due to the holiday, but gave me the name of the chief negotiator of the deal, one Chuck Arnold. I haven't yet heard back from him, but will update when I do.

The company also lists a primary aerosotrucures business on its web site, and apparently has done work on the C-17 with Boeing (who is proposing a 767-based tanker for KC-X).

I'm skeptical this can be pulled off. We know nothing about what type of boom will be provided to handle the 5,000 GPM offload rate, who would handle sensitive defensive systems and how parts supply and logistics would be guaranteed. And, how would DoD even begin to rate past performance; it doesn't look like there is a record of major prime contract work here?

Jump in with thoughts ...

[buglerbilly]

Sources: U.S.-Ukrainian Partners Seek More Time for KC-X Bid

By JOHN T. BENNETT

Published: 6 Jul 2010 21:00

U.S. Aerospace and its Ukrainian partner have asked the Pentagon to extend by 60 days the date by which industry must formally bid for a multibillion-dollar aerial refueling tanker contract, according to sources.


A source said U.S. Aerospace and Antonov plan to enter the four-engine AN-124-100, and a two-engine variant of that airframe known as the AN-122. (ANTONOV ASTC)

The California-based firm and aircraft-maker Antonov late last week asked Defense Department officials to push back the July 9 submission deadline for KC-X tanker proposals, according to a source.

In a July 6 telephone interview, Charles Arnold, a senior adviser to the U.S. Aerospace board, confirmed the request was made, but U.S. Aerospace and Antonov officials have yet to receive an answer.

Pentagon officials already have extended the deadline once, when EADS asked for additional weeks to bid as a prime contractor when its former partner, Northrop Grumman, backed out of the 179-plane, $35 billion competition. A DoD spokeswoman had not responded to an inquiry at the time of this posting.

Arnold said 60 additional days would give the two firms ample to time to prepare a more in-depth proposal.

"Without the additional time," he said, "it just will not be the work it could be."

Pentagon officials have the option of meeting U.S. Aerospace and Antonov half way.

"If they give us 30 additional days, we will be happy," Arnold said.

The U.S.-Ukrainian alliance plans to enter three aircraft: two four-engine planes, and a two-engine airframe that would be designed to the U.S. Air Force's KC-X requirements.

Boeing is expected to enter a 767-based aircraft, and EADS plans to pitch a tanker based on its A330.

If it pulls off what many defense analysts say would be a major upset, U.S. Aerospace-Antonov intends to perform final assembly on its tanker planes on U.S. soil. Antonov officials are in talks with several states in the southern and midwest United States about hosting a production facility, Arnold said. Citing a confidentiality pact, he declined to list those states.

EADS would do final assembly of its plane, if selected, at a new facility in Alabama.

[Deks]

Can't see it being delayed again tbh

[buglerbilly]

Not a chance especially as the below happens tomorrow..................

Boeing, EADS to Offer Bids On $35B Pentagon Tanker Contract This Week (excerpt)

(Source: The Hill; published July 6, 2010)

The long-running fight over the Pentagon’s $35 billion tanker contract enters a new stage on Friday when Boeing and EADS North America submit bids to build a midair refueling tanker.

Air Force and Defense Department officials will pore over thousands of pages of technical and price data over the next four months to choose a victor in a lobbying and public-relations war the two companies and their congressional supporters have waged for much of the last decade.

As they review the bids, a political fight will rage on with the midterm election as a backdrop — potentially derailing the much-coveted contract. Air Force officials said recently that the tanker contract will be awarded in mid-November, placing the key date days after the Nov. 2 elections.

Boeing contends that the company and its 800 suppliers would support about 50,000 U.S. jobs nationwide. It argues EADS, the parent company of Airbus and a European conglomerate, will build the planes in France, Germany and Spain.

The U.S. company is also pushing a World Trade Organization (WTO) ruling last week that found European governments illegally subsidized the launch of new Airbus planes. Boeing and its supporters argue the subsidies give EADS an unfair advantage by allowing it to offer a lower price than Boeing.

Boeing is going to submit a “best value” proposal for the tanker by Friday, but the company is “still concerned about the lack of consideration of the impact of illegal subsidies,” said Dan Beck, a Boeing spokesman. He said the company supports “congressional efforts to urge the Department of Defense to consider that in their evaluation.”

EADS will submit its bid this week and is “proud to compete on the merits of our tanker,” said Guy Hicks, EADS spokesman. “By contrast, our competitor appears determined to compete instead in the political arena, in an effort to take the decision authority away from the Air Force,” Hicks added.

EADS has said it plans to assemble the tanker aircraft in Mobile, Ala. The company has strong congressional backing from Alabama and Mississippi lawmakers, the majority of them Republicans.

About 48,000 U.S. workers will build the EADS tanker across a team of more than 200 supplier companies, the company contends. (end of excerpt)

Click here for the full article, on The Hill website............

http://thehill.com/business-a-lobbying/107369-boeing-eads-to-offer-bids-on-35b-tanker-contract-?tmpl=component&print=1&layout=default&page=

-ends-

[buglerbilly]

US-Ukrainian Industry Team to Bid in US KC-X Competition


A modified version of the AN-124 may become the new USAF tanker.

A realistic chance for US aircraft to be refuelled by Antonovs?

07:54 GMT, July 8, 2010 defpro.com | While the two aerospace giants Boeing and EADS engaged in judicial skirmishes on illegal subsidies and airily approached the deadline to submit their bids on 9 July, a new competitor silently and unexpectedly emerged this week with a bid that may appear to be quite unconventional for the US market. While, during the last years, the Northrop Grumman/EADS team (meanwhile only EADS) took quite some fire from Boeing and politicians favouring the Seattle-based company’s offer for the US Air Force’s future tanker aircraft – the quintessence of the criticism focusing on the fact that the competitor’s platform is a European-designed aircraft and allegedly not an “all-American” product –, the new player in this multi-billion dollar game will put forth a true eastern European giant. But will it have a realistic chance?

As announced early this week, the “intruder” to the placid long-lasting arm wrestling between Boeing and EADS, consisting of U.S. Aerospace, Inc. and Ukraine’s Antonov, will offer three models for the US KC-X programme: the AN-124-KC, AN-122-KC, a twin-engine variant of the AN-124-100 with advanced engines, electronics and avionics, and AN-112-KC, an updated airframe designed specifically to meet the tanker programme requirements. According to U.S. Aerospace, the airframes will be built in Ukraine by Antonov, with final assembly at a new facility in the United States – an industry-politically daring concept, keeping in mind the accusations that rained down on EADS for allegedly endangering US jobs and national industrial capabilities with its bid.

This transatlantic dispute was then crowned with a decision by the World Trade Organization (WTO) last week, ruling that some state support for Airbus was illegal. Boeing and other industrial and political stakeholders complained that this state support by European governments, including France and Germany, distorts competition. According to AFP sources a preliminary WTO ruling on the counter claim by Brussels against Washington over allegedly illicit state financing for Boeing is due to be released on 16 July.

While EADS and Boeing focussed on their judicial quarrels, the US-Ukrainian team quietly prepared a concept to outbid its competitors with a significantly lower-priced offer based on the proven Antonov transport aircraft platforms. However, time may become a critical factor, as this Friday’s deadline for the bids represents a challenging schedule for U.S. Aerospace and Antonov. U.S. Aerospace has asked the Pentagon for a 60-day extension to prepare its proposal. Yet, as a further delay is unlikely (EADS has already been granted an deadline extension after Northrop Grumman pulled out of the industrial team to protest against the allegedly unfair competition - http://www.defpro.com/daily/details/525/), John Kirkland, a Los Angeles-based lawyer for U.S. Aerospace, confirmed to Reuters that the company would submit its offer even if the Pentagon rejected their request.

Kirkland has also been the main source in an interesting intermezzo with an alleged bid by Russia’s United Aircraft Corporation (UAC) and an unnamed US partner (see also http://www.defpro.com/daily/details/534/). The news of a new participant (after all, a Russian state-owned company) in this competition caused a great stir in March 2010. However, these reports were quickly disclaimed by a UAC spokesman, saying that such rumours were absurd and that the company did not have any plans to enter the competition. This time the news is far from rumour.

Dmytro S. Kiva, President and General Designer of Antonov said on the occasion of the team’s announcement to participate in the KC-X competition: “Antonov’s participation in the US Air Force tanker bid with U.S. Aerospace, Inc. is an historic opportunity for Antonov to showcase its premier design, engineering and manufacturing capabilities to the world. We are extremely pleased to have entered into this agreement with U.S. Aerospace, Inc., and are looking forward to the long-term mutual benefits of our partnership.” On the other side of the Atlantic, Jerrold S. Pressman, Chairman of U.S. Aerospace, Inc., said: “We are honored to be partnering with the world’s premier designer and manufacturer of large transport aircraft.”

It remains questionable if the US-Ukrainian bid has a realistic chance to be successful. Kirkland claims that, not only would the Antonov-based offer fully meet all Air Force requirements, it would also be “dramatically” cheaper, would feature a rear cargo door, could land on dirt runways and would have a more stable airframe. However, the fact that the aircraft parts would be manufactured in Ukraine could be serious stumbling block. Furthermore, according to Reuters, U.S. Aerospace has a tenuous cash situation. The press agency also quotes aerospace analyst Richard Aboulafia of the Teal Group, calling the new bid “a complete waste of time.” EADS and Boeing may also have a valuable head start due to their international references, including decades of support of the US KC-135 tanker fleet by Boeing and EADS’s international experience with the A330 MRTT.

Air Force and Pentagon officials have recently expressed their supported of a fair competition. On Monday, Pentagon spokeswoman Navy Commander Wendy Snyder told The Moscow Times that “The Department [of Defense] is committed to conduct a fair, open and transparent acquisition process. We also believe that any company that is interested and qualified to participate in this important programme should do so.” The Air Force is expected to award the contract for 179 refuelling aircraft within a few months after receiving all bids by Friday 18:00 GMT, probably until mid-November. Considering the rapidly ageing tanker fleet currently in service, growing maintenance costs and the turbulent seven-year competition, the Pentagon and the Air Force are under great pressure to finally get the bid awarded.

----
By Nicolas von Kospoth, Managing Editor

[buglerbilly]

EADS, Expecting Tanker Win, Begins Shift to Alabama

By JOHN REED

Published: 8 Jul 2010 17:51

EADS North America has begun shifting its entire KC-X team to Mobile, Ala., a move designed to coincide with the company's bid on the $35 billion tanker contest, EADS executives said July 8.

"We're treating this as if, come the announcement of the contract award date of Nov. 12, we're gonna win," said EADS North America CEO Sean O'Keefe during a briefing with reporters to discuss EADS' 8,000-plus-page KC-X bid at the company's North American headquarters in Arlington, Va.

The team will begin moving to Mobile on July 12 to lay the groundwork for what will eventually become the manufacturing facility for EADS' 179 A330-based tankers, as well as all of its future A330-200 commercial freighters, if it wins the contest.

EADS officials plan to have roughly 200 workers in Mobile by the time the contract is awarded in mid-November, according to company spokesman Guy Hicks.

The European defense giant plans to start work on tankers in Alabama when the fourth test airplane in the program is delivered to Mobile, where the jet will receive military modifications. The company will gradually ramp up to producing airplanes and performing final modifications at the Mobile plant, according to former EADS North America CEO Ralph Crosby, who is now chairman of the company's board. He could not give a hard date for when that airplane will be sent to Alabama.

The contest is seen by the European company as a crucial foothold into the massive U.S. defense market. Securing a slot as a prime contractor to build 179 large aircraft positions the company well to win follow-up contracts to replace the remaining Air Force tanker fleet in the coming decades, Crosby said.

Crosby and O'Keefe went on to slam rival Boeing's efforts to turn focus on the tanker debate toward a recent World Trade Organization ruling citing EADS for using unfair government subsidies to develop its aircraft. These subsidies have allowed EADS to consistently undercut Boeing in the civil jetliner market, causing Boeing to lose double digit market share around the globe, according to the ruling.

Crosby accused Boeing and its allies on Capitol Hill of throwing "extraneous issues" regarding EADS into the legislative process. Crosby was referring to efforts by pro-Boeing lawmakers to force the Pentagon to factor the cost of $5 billion of the subsidies into the price of EADS' A330-based bid.

The former chief executive went on to say that he seriously doubts the legislation will pass before the Nov. 12 KC-X award date.

He would not address how the subsidies play into EADS' ability to offer its A330-based offering at an aggressive price compared to Boeing's design, which is based on an updated version of the older, smaller 767 jetliner.

"We feel very good about the offer that we've put together. ... There are substantial issues on price but there are also features that modify the price" in EADS' favor in the Pentagon's evaluation of the two jets' price tags versus performance. However, Crosby did not elaborate on the specific cost of the EADS jet other than to say, "I feel good about the intersection of value and price."

EADS officials sent the company's massive KC-X proposal to Wright Patterson Air Force Base, Ohio, via truck and a privately chartered Piaggio Avanti plane from Dulles International Airport in Virginia on the morning of July 8, one day ahead of the deadline to submit bids on the contest.

The proposal meets all of the Air Force's 372 mandatory performance requirements for the tanker, according to Crosby and O'Keefe. The executives repeated the EADS line that their proposal is "in most cases identical" to theA330-based tankers being flight tested for the Royal Australian Air Force.

O'Keefe also repeated the insinuation that Boeing's proposal comes loaded with more developmental risk since its KC-X offering, the NewGen Tanker, is only on the drawing boards while the EADS jet "is not an artist's rendering, it's an aircraft that flies today."

Boeing officials have until July 9 to submit their official bid into the competition.

[buglerbilly]

DATE:08/07/10

SOURCE:Air Transport Intelligence news

Airbus bemoans delay to WTO ruling on Boeing subsidies

Notification of a delay to a World Trade Organisation ruling on subsidies to Boeing has drawn complaint from Airbus on the same day that corporate partner EADS North America submited an 8,000-page proposal for the US Air Force tanker contract.

Chief executive Tom Enders says he is "surprised and disappointed by the last minute announcement", which postpones the ruling by two months, to mid-September. Nonetheless, he is claiming a vindication of Airbus's argument that "the complexity, inter-connectedness and industrial significance of the Boeing and Airbus cases would strain the capabilities of the WTO".

Last week, the WTO issued its final report on subsidies to Airbus. It ruled that a series of loans to the European airframer over the years - including reimbursable launch aid for the A380 and other infrastructure grants - broke international trade rules, but did not establish that the funding caused "injury" to the US aerospace industry.

Boeing's supporters in the US Congress have seized on the WTO ruling against Airbus to call on the Department of Defense to account for any perceived cost advantages in the EADS bid for the KC-X contract.

The USA initiated the case on Airbus subsidies in 2004, following its withdrawal from a bilateral agreement on trade in large civil aircraft. Europe then filed a counter case, claiming that US federal research and technology grants and funds from individual states represented illegal subsidies.

"Since these cases were filed, the world has changed," argues Enders. "In aviation, the previous duopoly marketplace is increasingly being populated by government-sponsored players, leaving Boeing and Airbus as those that, by any objective measure, benefit least from government support."

He expects the panel investigating Boeing funding to find that the airframer has "received billions of dollars in WTO illegal subsidies" and to uphold his assertion that the Boeing 787 "would not exist without government subsidies".

That view is echoed by Airbus North America chairman Allan McArtor, who describes Boeing's newest type as "the most highly subsidised aircraft in aircraft history."

On the delay to the WTO ruling, McArtor comments, "I think it smells like last week's fish," but adds: "I'm not saying WTO is at fault. The process somehow has gotten off track from where it was supposed to be."

Airbus has repeatedly asserted that the conflict can only be resolved through transatlantic negotiations.

"When the two WTO reports are published, those nations whose industries are building the aviation technologies of tomorrow can consider the WTO's views on the past to craft new market rules that efficiently guarantee fair trade, a level playing field and continuous technology investment," says Enders.

[buglerbilly]

EADS Fires Across Boeing’s Bow

By Colin Clark Thursday, July 8th, 2010 5:21 pm

Demonstrably proud of their bid on the KC-X tanker, EADS NA officials turned it in one day early and the company’s chairman slammed Boeing for “wasting a lot of time trying to derail” the competition “because someone thinks their plane is inferior.” Boeing’s attacks amounted, said company chairman Ralph Crosby, to a lot of “crap.”

EADS flew five paper (and one CD) copies of its 8.800-page bid to Wright-Patterson Air Force Base on a chartered prop plane, expecting them to arrive at 2:40 p.m. The company filmed the copies being loaded aboard and the takeoff for employees to watch later. One copy traveled by land just in case.

Crosby opened this afternoon’s press conference with a none-too subtle dig at Boeing. As a video played of the Australian tanker built by parent EADS executing a refueling, Crosby said: “I’m transfixed by the video. I love watching real tankers doing real tanking.”

Crosby offered a staunch defense of the company’s bid, which many observers feel faces an uphill struggle given that the Air Force’s RFP basically calls for a replacement of KC-135s, a much smaller plane than the modified Airbus 330 which EADS will offer. “I feel good about the intersection of value and price,” in the KC-X bid, Crosby told reporters. He dismissed the idea that EADS may not have a good shot, saying they bid “for one single reason — to win.”

Crosby cast the competition as the last great defense procurement of the twenty-first century, placing the value of the first tranche of 179 planes at roughly $40 billion, and estimating the total value of the tanker program over time at some $120 billion.

The governor of Alabama will open the EADS facility in Mobile on Monday, and company officials went to some lengths to praise the state’s business climate. CEO Sean O’Keefe said building the planes in Mobile would help lower costs. The company touted the jobs impact of the program, which will employ an estimated 48,000 Americans and help sustain a supplier base of more than 200 U.S. companies.

Crosby noted that, should EADS win the tanker deal, it will also build A330 freighter aircraft in Mobile

Once the bids are in, the Air Force and the Defense Contract Management Agency will send people to Mobile and to Europe (where the first set of planes will largely be built) for a pre-award review. The government folk will tour facilities and interview some of the 200 core members of the EADS tanker team to assess the company’s ability to design and produce the aircraft in line with its bid.

On top of their usual rejection of claims that the World Trade Organization has ruled that the A330 received illegal trade subsidies during development, one EADS official went so far as to accuse the WTO of shenanigans for deciding to postpone release until September of its preliminary ruling on a European Union complaint that the U.S. provided illegal public subsidies to Boeing. The European Union’s commission said today that the delay between the WTO ruling on Airbus and the one on Boeing “creates the wrong impression that Airbus has received some WTO-incompatible support, whereas Boeing has not.”

Allan McArtor, chairman of Airbue Americas, told reporters the decision to delay was “unprecedented.” Coming just 10 days before the opening of the Farnborough Air Show and when the KC-X bid was due, he hinted darkly that something was afoot, saying it “smells like a fish.”

Boeing will hold a celebration of its tanker bid tomorrow morning in Everett, Wash. with Sen. Patty Murray, Reps. Norm Dicks, Rick Larsen, Jim McDermott, Jay Inslee and a host of Boeing workers attending.

Read more: http://www.dodbuzz.com/2010/07/08/eads-fires-across-boeings-bow/#ixzz0t8JMuAML

[Chunder]

FWIW, has anyone else noticed the journalistic jingo for political point scoring over the past few years, as "slamming"? Probably time to get a new phrase.

[buglerbilly]

European Commission Disappointed by Delay to WTO Confidential Interim Panel Report on Boeing (DS 353)

(Source: European Commission; issued July 8, 2010)

The European Commission has learned from the Chairman of the WTO panel investigating subsidies to Boeing (DS 353) that there is to be a further delay in the issuing of the confidential interim panel report. Since this information was made public by Washington earlier today, the European Commission can now confirm that we were informed yesterday - on a confidential basis - that its publication will be delayed until mid- September at the latest.

The European Commission is extremely disappointed to learn of this additional delay into the issuing of the interim panel report.

The time lag between this case, and the United States' case against support to Airbus (DS 316), has constantly increased over the six years this dispute has been running and the gap is now at nearly a year.

It creates the wrong impression that Airbus has received some WTO incompatible support, whereas Boeing has not. Only when we have received both panel reports will both sides have a more complete picture of the dispute. As we said last week with the publication of the panel report in DS 316, at the moment we only have half the story.

The European Commission remains confident as to the strength of the EU's legal challenge. We are, however, very concerned that these delays decrease the chance for a negotiated settlement, which is – as publicly stated by both sides – the desired outcome to this dispute.

We now expect the Panel to issue its interim report in DS 353 without any further delay. (ends)

Statement by Airbus President and CEO Tom Enders in Response to the WTO Announcement of a Further Delay of the Report in the Boeing Subsidies Case (DS 353)

(Source: Airbus; issued July 8, 2010)

"We are surprised and disappointed by the last minute announcement of yet another delay by the Boeing subsidies panel.

“We are, however, not surprised by the apparent difficulties the WTO is faced with.

“We have said time and again that the complexity, interconnectedness and industrial significance of the Boeing and Airbus cases would strain the capabilities of the WTO.

“Since these cases were filed, the world has changed. In aviation, the previous duopoly marketplace is increasingly being populated by government-sponsored players, leaving Boeing and Airbus as those that, by any objective measure, benefit least from government support.

“The ongoing struggle of the WTO to address the world as it was in 2004 (the date the cases were filed) raises the question whether it can succeed in its basic mission to create a climate for a negotiated settlement on the basis of fair market rules in the interest of both the industry and the employees on both sides of the Atlantic.

“Another delay is a disappointment. But we are looking forward to the Boeing subsidies panel report. It will eventually come, and it will show: Boeing has received billions of dollars in WTO illegal subsidies.

“The importance of this report is greater, however, than a simple vindication of the obvious fact that Boeing aircraft such as the B787 would not exist without government subsidies.

“When the two WTO reports are published, those nations whose industries are building the aviation technologies of tomorrow can consider the WTO's views on the past to craft new market rules that efficiently guarantee fair trade, a level playing field and continuous technology investment."

-ends-

[buglerbilly]

Sources: U.S. Aerospace-Antonov To Bid Only One Tanker; DoD Rejects Plea For More Time

By JOHN T. BENNETT

Published: 9 Jul 2010 07:36

The U.S. Defense Department have rejected a request made by U.S. Aerospace and its Ukrainian partner for more time to put together a bid for a multibillion-dollar U.S. Air Force tanker contract, industry sources say.

As a result, the team will enter only one aircraft, not three, into the high-profile KC-X competition, say U.S. Aerospace-Antonov sources.

The U.S. aircraft components manufacturer and its Ukrainian partner, Antonov, will only enter the conceptual two-engine AN-112-KC, team sources said. That decision was made late on July 8 after U.S. Aerospace and Antonov officials learned the Pentagon had denied their request to extend by 60 days the date by which bids are due, sources said.

All industry bids must be submitted on July 9.

In a July 7 telephone interview, Charles Arnold, a senior adviser to the U.S. Aerospace board, said 60 additional days would have given the two firms ample to time to prepare a more in-depth proposal.

"Without the additional time," he said, "it just will not be the work it could be."

Pentagon officials had the option of meeting U.S. Aerospace and Antonov half way. A Pentagon source had indicated it was unlikely the deadline would be extended for a second time. DoD already gave EADS more time when its former partner, Northrop Grumman, withdrew.

Arnold made clear, however, that the transatlantic team would bid even without additional time.

"If they give us 30 additional days, we will be happy," he told Defense News.

As first reported July 2 by DefenseNews.com, U.S. Aerospace and Antonov sources said last week they intended to enter three aircraft: the four-engine AN-124-100, a two-engine variant of that airframe known as the AN-122, and the AN-112, a design specifically tailored to the KC-X requirements.

The AN-112 would be the only plane in the race designed specifically for the Air Force's tanker requirements. Arnold said that plane has been configured to several other competitions, and would be tweaked to fit the KC-X specs, as well.

Virtually nothing is known about the AN-112, U.S. aviation and defense analysts say.

A U.S Aerospace-Antonov fact sheet obtained by Defense News describes the

AN-112 as a "modern mid-sized military transport." The fact sheet states the 112 meets all 373 of the Air Force's 373 mandatory KC-X requirements.

It also would be the "most durable, dependable, and serviceable" aircraft in the competition, according to the fact sheet. The document also touts its fuel offload, cargo capacity and projected service life.

Boeing is expected to enter a 767-based aircraft, and EADS plans to pitch a tanker based on its A330.

Pentagon officials on July 7 confirmed they have heard from the U.S. Aerospace-Antonov team.

The department welcomes "any company that is interested and qualified" to bid for the 179-plane, $35 billion tanker contract, Pentagon spokeswoman Cheryl Irwin said July 7.

U.S. defense analysts say the U.S. Aerospace-Antonov bid is a long shot to capture the KC-X contract, citing U.S. Aerospace's recent financial troubles, as well as Antonov being state-owned and its close relationship with Moscow. Some analysts and officials say its nothing more than a publicity stunt; U.S. Aerospace-Antonov sources tell Defense News this is merely the first in an expected series of partnerships to pursue U.S. military and commercial contracts.

[buglerbilly]

Boeing submits bid for US military mega project

July 10, 2010 - 12:09AM

US aerospace giant Boeing on Friday submitted its bid for a 40-billion dollar US military contract also contested by bitter rival Airbus.

Boeing said it had hand-delivered the 8,000-page proposal to build 179 aerial refueling tankers for the US Air Force to a base in Ohio.

In a statement, the firm said its bid would create "an American-made" tanker that "will satisfy all 372 mandatory Air Force requirements and be capable, survivable, and combat-ready at the lowest cost to the taxpayer."

Airbus submitted its bid on Thursday, stressing its tanker would be more practical because it is based on an already existing plane.

Boeing shot back that its plane would be based on the 767 commercial airplane.

"We are honored to support our US Air Force customer and submit this proposal to meet the critical mission needs of this nation," said Dennis Muilenburg, the head of Boeing Defense, Space and Security.

Although the details of the bid were not made public, Boeing's plane is expected to be smaller and less costly to operate than that of Airbus.

Boeing claimed the plane would be "more cost-effective to own and operate than the larger and heavier Airbus A330 tanker," and would "save American taxpayers more than 10 billion US dollars in fuel costs alone over its 40-year service life because it burns 24 percent less fuel."

Hoping to snare the contract "of the century," executives from Airbus's parent firm EADS said their 8,819-page bidding document was submitted ahead of a Friday deadline.

The European firm is proposing a military version of its A330 commercial passenger airliner, the KC-45.

With an eye on its US rival, EADS said if it won the contract, a new aircraft manufacturing facility in Mobile, Alabama would help create 48,000 US jobs.

Boeing said its bid would create "approximately 50,000 total US jobs."

Airbus and Boeing have traded accusations of unfair competition as they compete for the kudos and cash that come with producing 179 aircraft for the US military.

US lawmakers have called for the value of Airbus's alleged subsidies to be factored into the European firm's bid.

A third company, US Aerospace, has announced it would put up a last-minute bid in partnership with the Russian-Ukrainian manufacturer Antonov.

But its ability to meet US military requirements remains uncertain, given its serious financial difficulties. And Antonov has not confirmed its participation in the project.

US Aerospace said on Wednesday that it would like the bid deadline extended by 30 or 60 days.

The Air Force is expected to make its decision by November 12.

It will be the third time the Defense Department has awarded the contract.

In 2003, Boeing won the lucrative deal, but the decision was overturned after a conflict of interest between the Pentagon and the aircraft manufacturer was revealed.

A senior purchasing manager at the Department of Defense had been negotiating her employment with Boeing at the time of the bid. The Air Force official was later convicted of criminal conspiracy.

Airbus won a second call for proposals in a joint bid with US firm Northrop Grumman in 2008.

Again, the decision was annulled when the US Government Accountability Office found the offers were incorrectly analyzed.

Northrop-Airbus subsequently withdrew from the race triggering an uproar in Europe, with French President Nicolas Sarkozy and German Chancellor Angela Merkel accusing Washington of bias in favor of the all-American Boeing plane.

© 2010 AFP
This story is sourced direct from an overseas news agency as an additional service to readers. Spelling follows North American usage, along with foreign currency and measurement units.

[buglerbilly]

Ares

A Defense Technology Blog

KC-X Bids In: And the Race Begins, Again

Posted by Amy Butler at 7/9/2010 12:45 PM CDT

Another year is halfway through, and another round of tanker bids is in. A winner is expected Nov. 12, though Air Force officials simply say Fall.

Don't expect much out of the Pentagon. It appears to be in lock down mode. Air Force spokeswoman Col. Debra Millett says the service will not even disclose how many bidders offer proposals. Clearly, the name of the game is protest avoidance.

Here's Millett's statement:


The KC-X program is presently in the source selection process, and in order to protect the integrity and independence of this process, we are prohibited by the Federal Acquisition Regulation (FAR) from providing further detail.

However, the Department continues to be committed to a free, fair and open competitive process within the parameters of those rules and regulations. We expect a contract award sometime in the fall.

EADS North America turned in its 8,819 pg. proposal a day early on July 9. Company officials were clearly confident in their A330-200-based proposal, but didn't miss an opportunity to point out what they see as public rhetoric from rival, Boeing, which EADS North America Chairman Ralph Crosby calls "crap."

He and his colleagues also flatly rejected the notion that a recent WTO finding that Airbus accepted illegal subsidies in developing its commercial product line should have bearing on the KC-135 replacement program.

Boeing announced today it submitted its 8,000-pg bid as well. Still, its design remains shrouded in some mystery. Officials reiterate that the 767-based proposal will feature a 787 Dreamliner cockpit and an "advanced" KC-10 boom with an expanded flight envelope and fly-by-wire controls.

Each company must meet 372 mandatory requirements to compete; the winner will largely be determined by a price shootout. Adjustments to the price will be made to account for fuel burn, efficiency and facilities associated with each bid.

Meanwhile, the only wild card left is whether California-based US Aerospace will propose three Antonov models. The little-known company filed papers last week with the SEC indicating an intent to bid, but it is largely being met with skepticism.

Any company wishing to compete must meet a "financial viability" requirement that can be proven with documentation. It is unclear whether US Aerospace meets this, and company officials have not returned repeated calls and emails for comment.

[buglerbilly]

A bit more on the Boeing submission.............

Boeing Submits Its Bid For KC-X

By JOHN REED

Published: 9 Jul 2010 11:45

Boeing officials on July 9 said they had "hand delivered" their bid on the $35 billion KC-X tanker replacement contest to the U.S. Air Force, one day after rival EADS submitted its own entry.


Boeing's proposal is based on an updated version of the tanker the firm produced for Italy and Japan. An Italian jet is shown above. (BOEING)

The Chicago defense giant is offering up an updated version of its 767-based tanker ordered by Italy and Japan, dubbed the NewGen Tanker.

All Boeing will say about its latest offering is that it meets all 372 performance requirements laid out in the Pentagon's request for proposals, and that it will feature the glass cockpit of the 787 Dreamliner and the boom from the venerable KC-10 Extender.

THAT doesn't match an earlier post which said Boeing was trialling or developing a digital boom to match or surpass the new EADS one............

In a news release, Boeing took several swipes at EADS' Airbus A330-based offering, saying that it will burn 24 percent more fuel and be up to 20 percent more expensive to maintain than the Boeing jet. Boeing's statement also threw a veiled insult at EADS by saying the NewGen has "a cockpit design philosophy that puts the pilot in command rather than allowing computer software to limit combat maneuverability."

WTF does this double-speak mean?!

Airbus jets make use of extensive computer controls to assist pilots in operating the aircraft.

An undisclosed Pentagon and Air Force team will now evaluate the offerings based on their ability to meet the 372 performance metrics along with their price tags and operating costs. If the bids meet all 372 requirements and are both priced within 1 percent of each other, the evaluation team will compare the jets' performance on several dozen additional requirements. The airplane that meets the most of those will win.

[buglerbilly]

U.S. Aerospace Offers Reasons KC-X Bid Might Fail

By JOHN T. BENNETT

Published: 9 Jul 2010 15:16

U.S. Aerospace on July 9 submitted its long-shot bid for the U.S. Air Force's KC-X tanker contract, but in documents filed with federal regulators the same day, the company gives itself little chance of winning.

The California-based aircraft components maker and its Ukrainian partner Antonov have entered a modified version of the AN-112-KC into the $35 billion tanker race, joining Boeing and EADS.

Since announcing the unlikely partnership, U.S. defense and aviation analysts have scoffed at the notion that U.S. Aerospace and Antonov could win the competition. U.S. Aerospace officials have acknowledged their lone path to victory is pitching the lowest price.

In a new twist, however, an 8K/A report U.S. Aerospace filed with the U.S. Securities and Exchange Commission on July 9 essentially acknowledges what experts have been saying for a week.

"The Air Force may find that our proposal does not meet all mandatory [request for proposals] requirements, that we do not have qualified subcontractors and teaming partners, that we are not a capable and responsible contractor, that we have not obtained or processed the classified information that is needed to prepare a proposal, that we have not demonstrated that the company has the facility and personnel clearances that are prerequisites to receiving, handling and storing classified information, and that our failure to meet the proposal submittal deadline was attributable to our failure to act diligently and promptly," the document states.

But wait, there's more.

The company tells the SEC the air service might conclude Antonov "is not an acceptable subcontractor, that required teaming agreements have not been entered into, and that using [a] Ukranian commercial aircraft as the basis for a KC-X tanker proposal is unacceptable."

U.S. Aerospace also acknowledges the Air Force might deem the AN-112-KC "too new" or "not adequately designed, manufactured or certified." The SEC filing also states the team might not have submitted all necessary information to amply support their last-minute bid.

"For any or all of these reasons, the Air Force may not select our bid, may disqualify our bid, or may refuse to consider it on the merits, or at all," according to the SEC form.

[buglerbilly]

DATE:09/07/10

SOURCE:Flight International

IAI ready to flight test Colombia's 767 tanker

By Arie Egozi

In the middle of the HUGE USAF Tanker contest we have the private contractors re-developing former commercial airliners into Tankers...........

Israel Aerospace Industries expects to launch flight-testing in early August with a Boeing 767-300 that has been converted to a tanker for the Colombian air force.

IAI won a contract in 2008 to convert the commercial airliner to serve as an in-flight refuelling aircraft and VIP transport for Colombia. It will be delivered before the end of the year.

The company acquired the used 767 and has converted it with a hose and drogue refuelling system.


© Israel Aerospace Industries

IAI has also offered a 767 version (artist's impression, above) equipped with a tail boom for requirements in nations such as Poland.

Colombia operates one Boeing 707 tanker, as listed in Flightglobal's MiliCAS database. IAI is also upgrading the nation's Kfir fighters, and delivering additional, ex-Israeli air force examples under a separate contract.

[buglerbilly]

Boeing Touts KC-X Cost, Jobs

By Colin Clark Friday, July 9th, 2010 11:35 am



Boeing’s tanker bid is in for the $40 billion program. The company focused on size and cost in its release announcing the bid.

The 8,000-page proposal, “hand-delivered” to Wright-Patterson Air Force Base, “offers an American-made, 767-based multi-mission tanker that will satisfy all 372 mandatory Air Force requirements and be capable, survivable, and combat-ready at the lowest cost to the taxpayer,” according to the company’s press release.

Aiming squarely at claims by EADS NA that its plane can offload more fuel at faster rates and has a tanker flying and ready to get built, Boeing said its tanker “will deliver widebody capabilities in a narrowbody footprint, operate in any theater or from any base, and — with the lowest operating cost of any tanker in the competition — save the Air Force and the American taxpayers billions of dollars.”

One of the attributes mentioned in the Boeing release — the digital flight deck using 787 Dreamliner displays — raises interesting questions about cost that Boeing has so far not addressed. This is the biggest change from the last bid. Several close observers of the tanker competition say placing such modern technology in a relatively old airframe will require substantial and probably costly modifications.

Among the reasons for the Boeing decision to install the 787 technology is that this is proof of commitment to the company’s “design philosophy that places the pilot in command rather than allowing computer software to limit combat maneuverability.” That’s a nice dig at Airbus’ fly-by-wire approach which places considerable reliance on intelligent software and built-in systems to manage airplane performance.

Boeing also claims it will provide “tens of thousands more jobs in the United States than an Airbus A330 tanker that is designed and largely manufactured in Europe.” EADS NA claims 48,000 U.S. jobs will result should it be awarded the contract. Biggest difference here is that Boeing claims “more than 800 suppliers in more than 40 states” while EADS claims 200 U.S. companies on its supplier base.

Read more: http://www.dodbuzz.com/2010/07/09/boeing-touts-kc-x-cost-jobs/#ixzz0tEHubtix

[Chunder]

Interesting that IAI has gone down the 767 path... in 2008 the Bush administration vetoed a FMS on the sale of 767 tankers to Israel for fear of use against Iran. Obviously IAI feels that the 767 is worthy of development (I don't recall the Israelies seeking either airbus tanker variant).

[JimWH]

The Boeing dig at the Airbus's FBW has to be one of their more ridiculous plays. A modern FBW allows a pilot to get on with getting the plane to do what they want it to do rather than having to wrestle the aircraft. It's like objecting to a GUI because it robs users of the ability to run a computer through command lines.

[Marc 1]

In a news release, Boeing took several swipes at EADS' Airbus A330-based offering, saying that it will burn 24 percent more fuel and be up to 20 percent more expensive to maintain than the Boeing jet. Boeing's statement also threw a veiled insult at EADS by saying the NewGen has "a cockpit design philosophy that puts the pilot in command rather than allowing computer software to limit combat maneuverability."

WTF does this double-speak mean?!

Airbus jets make use of extensive computer controls to assist pilots in operating the aircraft.

The clue is in the line below yours - the A330 being the more recent design and in line with Airbus philosophy is FBW with protections built in that limit the pilots to whatever flight envelope is designed in. You cannot for instance on the commercial A330 deliberately roll the wings more than a certain degree of bank, nor can you pitch the nose up beyond certain levels. If the airspeed drops too much and a stall is imminent the flight computers will drop the nose etc. The 767 is a manual airplane, if the pilot wants to he can rip the wings off pulling too many g's in a dive, do a barrel roll etc - the pilot is the boss. This is the Boeing philosophy - even the FBW 777 will allow the pilot to make the decisions rather than the computer limiting the pilot.

From what I have gathered the two different approached have their fans - some pilots believe that some of the systems in the airbus' have probably saved passengers lives by ensuring a hamfisted pilot didn't kill himself and the plane, others argue that its better to have the falible pilot in direct control regardless rather than fighting computers that may seem to be intent on killing all onboard. The oft heard criticism was aparently uttered by an airbus pilot who had something misconfigured on the A320 that pranged at LeBourgeut about 15-20 years ago - he was supposedly heard to say on the cockpit voice recorder: "What's it doing now?"

[buglerbilly]

The clue is in the line below yours - the A330 being the more recent design and in line with Airbus philosophy is FBW with protections built in that limit the pilots to whatever flight envelope is designed in. You cannot for instance on the commercial A330 deliberately roll the wings more than a certain degree of bank, nor can you pitch the nose up beyond certain levels. If the airspeed drops too much and a stall is imminent the flight computers will drop the nose etc. The 767 is a manual airplane, if the pilot wants to he can rip the wings off pulling too many g's in a dive, do a barrel roll etc - the pilot is the boss. This is the Boeing philosophy - even the FBW 777 will allow the pilot to make the decisions rather than the computer limiting the pilot.

From what I have gathered the two different approached have their fans - some pilots believe that some of the systems in the airbus' have probably saved passengers lives by ensuring a hamfisted pilot didn't kill himself and the plane, others argue that its better to have the falible pilot in direct control regardless rather than fighting computers that may seem to be intent on killing all onboard. The oft heard criticism was aparently uttered by an airbus pilot who had something misconfigured on the A320 that pranged at LeBourgeut about 15-20 years ago - he was supposedly heard to say on the cockpit voice recorder: "What's it doing now?"

I know what the theory is but its bollox as far as I am concerned, more Boeing BS masquerading as reality. A fully-loaded 767 has the agility of a brick............well, apart from the fact it'll drop like a stone if stressed too far........

[buglerbilly]

Airbus slashes prices to win US military project

(AFP) – 16 hours ago

BERLIN — European aerospace giant Airbus has cut its prices in a bid to win a fight with US rival Boeing for a 40-billion-dollar US Air Force contract, a German business daily reported on Monday.

Airbus has cut the proposed cost for the contract to build 179 aerial refuelling tankers by at least 10 percent from the level in a previous offer in 2008, the Financial Times Deutschland (FTD) reported, citing industry sources.

Last week, the two competitors submitted their offers to Washington, setting the stage for a high-stakes transatlantic trade scrap.

It will be the third time the contract has been awarded.

In 2003, Boeing won the deal, but the decision was overturned after a conflict of interest emerged between the Pentagon and the aircraft manufacturer.

Five years later, Airbus won a second call for proposals in a joint bid with US firm Northrop Grumman but again the decision was annulled when the US Government Accountability Office found the offers were incorrectly analysed.

Northrop Grumman subsequently withdrew from the race triggering uproar in Europe with French President Nicolas Sarkozy and German Chancellor Angela Merkel accusing Washington of bias in favour of the all-American Boeing plane.

The Air Force is expected to make its decision by November 12.

The project, worth an estimated 35-40 billion dollars (27.7-31.5 billion euros), is seen as crucial for bolstering US air power and will be a financial boon for the winning firm.

The FTD said that the deal could be worth as much as 100 billion dollars when follow-up contracts were taken into account.

Copyright © 2010 AFP. All rights reserved

[buglerbilly]

Battle in the Skies: EADS and Boeing Fight It Out for Refueling Fleet Deal

(Source: Deutsche Welle German radio; published July 9, 2010)

European aerospace giant EADS has confirmed it has made a bid for a massive US military contract for tanker refueling aircraft. Arch rival Boeing is expected to submit its proposal on Friday.

The European Aeronautic Defense and Space Company (EADS) bid to win the contract to build a new fleet of US Air Force aerial-refueling planes did not come as a surprise. Back in April, the Pentagon announced it was willing to extend the bidding deadline to July 9 in order to allow the Airbus parent company more time to consider submitting an offer.

EADS North America Chairman Ralph Crosby responded at the time by saying the deal, worth up to 39 billion euros ($50 billion), was a "hell of an opportunity" for the company.

An opportunity it has now seized. Speaking to reporters on Thursday, Crosby said the EADS 8,000-page proposal would prove its tanker's "unequalled capabilities." He said his company was proud of its offering, which he described as "the only one in this competition that is flying and refueling today."

A successful EADS bid will see the European giant make a military version of the Airbus A330 commercial passenger plane to replace the Boeing-built fleet, now an average of 50 years-old.

Stiff competition

But Airbus is not in the running alone for the construction of 179 aerial-refueling tankers. Boeing, which is the Pentagon's second largest supplier by sales, is expected to submit an offer based on its 767-passenger jet on Friday.

Earlier, US Aerospace said it was also planning a last-minute bid in collaboration with Russian-Ukrainian manufacturer Antonov. But given the American company's financial woes and the fact that Antonov has yet to confirm its involvement in the project, there is some doubt about the seriousness of the unexpected announcement.

Aviation expert Cord Schellenberg told Deutsche Welle that even if there is a third bid, he doesn't see US Aerospace as a serious contender. "This is a race between Boeing and Airbus," he said, adding that although there was no clear favorite, there was a good chance that geography would play the deciding hand.

"The US administration has to decide whether they are willing to accept a European manufacturer or not," Schellenberg said, adding that American lobbyists were pushing very hard for home-designed and home-produced tankers.

Born in the U.S.A.

There has been much lament about the potential implications of the lucrative contract falling into European hands, and topping the list is the ever-present issue of Americans losing jobs. EADS however, says that if it wins the bidding war, the aircraft would be assembled at a new facility in Alabama, thereby creating jobs.

As strategic as such a pledge might be, Schellenberg says its not enough for the military minds that want Uncle Sam's stamp everywhere.

"They think they should buy American and not only aircraft produced in the US," Schellenberg said. "They should by designed by and come from an American company as well."

An eye for an eye

Transatlantic rivals, Boeing and Airbus have been locked in a bitter fight for the tanker deal since 2003. That year, the contract was awarded to Boeing but the decision was overturned after the revelation of a conflict of interest. Then in 2008, it went to Airbus but was withdrawn again after the US Government Accountability Office found the offers had been incorrectly analyzed.

With that kind of history, the two companies are watching each other with eagle eyes, waiting to trip one another up whenever the opportunity arises. Last week, the World Trade Organization (WTO) responded to a US complaint over subsidies to Airbus, ruling that state support had helped Airbus get its flagship A380 airborne.

In a tit-for-tat countersuit, the European Union has the WTO looking into allegations of improper US federal, state and local subsidies to Boeing. An interim report on the case had originally been expected by next week but an announcement on Thursday put the date back to mid-September.

EADS, the parent company of Airbus, had been hoping that the report would deflect some of the negative attention focused on it after last week's ruling, and the EU and Airbus criticized the delay.

"The time lag between this case and the United States' case against support to Airbus… has constantly increased over the six years this dispute has been running and the gap is now at nearly a year," the EU's executive Commission said.

But Ralph Crosby rejected any talk of the subsidies in the context of the tanker deal. "We are spending all our time on relatively arcane and inconsequential issues," he told reporters, adding that the only real issue was how well the respective proposals meet the needs of the Pentagon. "It is the defense acquisition for the remainder of the century," he said.

Cord Schellenberg agrees that it would make sense to forget geographical and political issues and to focus instead on business.

"The question is who is offering the better aircraft at the better price?" he said. "That is what the state should be looking for, especially as this is a tanker and not a war aircraft."

The US Air Force is expected to announce its decision in November.

-ends-

[buglerbilly]

Mobile Rally Celebrates KC-45 Tanker Team Move to the Gulf Coast

(Source: EADS North America; issued July 12, 2010)

MOBILE, AL --- The greater Mobile region today held a community rally to celebrate the relocation of EADS North America's KC-45 Tanker program team to Mobile, Ala. On July 8 the company submitted its proposal in the U.S. Air Force KC-X aerial refueling tanker competition, and reaffirmed its intention to build the KC-45 in Mobile.

KC-45 production will take place at a new aircraft center of excellence to be built at Mobile's Brookley Industrial Complex, creating more than 1,500 direct jobs and thousands more in the greater Gulf Coast area. Nationwide, KC-45 production will create or support 48,000 American jobs across a supplier team of more than 200 companies.

While a final decision from the Air Force is months away, EADS North America is ready to begin work in Alabama, and today began the transfer of its KC-45 program management team of almost 200 employees to its new Mobile offices.

"We're confident in our offering, and want to be ready to get to work right away when the Air Force selects the KC-45," said EADS North America Chairman Ralph Crosby. "Our fighting men and women have waited far too long for a new tanker, and the people of this part of the country have waited far too long for the jobs the KC-45 would bring."

Crosby was joined at today's rally by Alabama Governor Bob Riley, Alabama Senator Jeff Sessions, Alabama's 1st Congressional District Representative Jo Bonner, Mobile Mayor Samuel L. Jones and Mobile County Commission President Merceria Ludgood. Crosby praised all the elected officials for unwavering support throughout EADS North America's KC-45 campaign.

"All along we've asked for only one thing: for the Pentagon to select the airplane that is best for the men and women who serve our nation. We're confident that if the best airplane is selected, it will be the KC-45. The KC-45 is the only one in this competition that is flying and refueling today. It is the superior aircraft," said Gov. Riley.

"If the welfare of our warfighters trumps politics in this competition, the Air Force will select the EADS tanker," said Alabama Senator Richard Shelby. "It is clearly the most capable plane, and will be built by American workers to best serve and protect American warfighters."

"The Mobile community is proud to stand arm-in-arm with EADS in the competition for the Air Force tanker," said Alabama Senator Jeff Sessions. "The EADS tanker is clearly the superior aircraft, offering more capabilities to the men and women who protect our nation, and at a better value to the taxpayer. EADS' investment in Mobile, combined with a talented workforce and excellent resources and infrastructure, is an important step in turning South Alabama and the Gulf Coast into a world-class center for aviation manufacturing," Sessions added.

If the KC-45 is selected, EADS North America also has committed to building commercial A330 freighter aircraft at Brookley Field -- more than doubling the aircraft production that the tanker alone will bring.

"EADS' partnership with South Alabama is a natural fit," said Congressman Bonner. "Our region has the talented workforce and the infrastructure to deliver the very best tanker to our war fighters, while laying the foundation for a new aviation corridor along America's Gulf Coast. We are excited to be a part of an EADS team which offers our military the most advanced and adaptable refueling aircraft in the world."

"I am thrilled to partner with a world-class company like EADS North America to help bring badly needed, high-skilled jobs to a workforce unsurpassed in its skill and dedication," added Mobile's Mayor Jones. "As a United States military veteran with deep experience with combat aircraft, I could not be prouder that Mobilians will be at the forefront of building the EADS North America KC-45."

"The partnership between Mobile and EADS North America offers the hardworking women and men of Mobile a critical shot in the arm as we feel the effects not only of the national economic downturn, but of an oil spill that has devastated our community," said Mobile County Commission President Ludgood. "Mobilians are thrilled both at the much-needed jobs this partnership would bring, but also at the opportunity to contribute to the defense of the nation."

The reliability and performance of the KC-45 and its refueling systems has been validated by over 1,000 boom/hose-and-drogue contacts and refuelings involving a wide range of aircraft, including F-16 and F/A-18 fighters, E-3 AWACS and other A330 tankers. The KC-45 is the U.S. Air Force configuration of the A330 Multi Role Tanker Transport, which has been selected by four allied nations, winning every head-to-head competition against Boeing tankers. The KC-45 carries more fuel, cargo and passengers over greater ranges than the NewGen concept aircraft that Boeing is offering the Air Force.

EADS North America is the North American operation of EADS, a global leader in aerospace, defense and related services. As a leader in all sectors of defense and homeland security, EADS North America and its parent company, EADS, contribute over $11 billion to the U.S. economy annually and support more than 200,000 American jobs through its network of suppliers and services. Operating in 17 states, EADS North America offers a broad array of advanced solutions to its customers in the commercial, homeland security, aerospace and defense markets.

-ends-

[buglerbilly]

A330 MRTT Appears In Royal Australian Air Force Colours

(Source: Airbus Military; issued July 14, 2010)



One of the two Airbus Military A330 MRTT Multi Role Transport Tankers scheduled to be delivered to the Royal Australian Air Force this year has now been painted in the service’s colours. The aircraft, seen here at the Airbus Military facility at Getafe, Madrid, is the second to have undergone conversion and one of five ordered by the RAAF. The first two will be delivered later this year and will serve under the designation KC-30A with 33 Squadron at RAAF Amberley.

The Airbus Military A330 MRTT is the most advanced and most cost-effective Multi Role Tanker Transport existing today. The large 111,000 kg/245,000 lb basic fuel capacity of the successful A330-200 airliner, from which it is derived, enables the A330 MRTT to excel in air-to-air refuelling missions without any additional fuel tanks.

The A330 MRTT is offered with a choice of proven in-air refuelling systems, including an advanced aerial refuelling boom system, and/or hose and drogue wingpods and/or fuselage refuelling unit. Thanks to its true wide-body fuselage, the A330 MRTT can also be used as a pure transport aircraft able to carry up to 380 passengers or a payload of up to 45 tonnes / 99,000 lb. It can also easily be converted to accommodate up to 130 stretchers for Medical Evacuation (MEDEVAC). Australia, Saudi Arabia, the United Arab Emirates and the United Kingdom have ordered a total of 28 A330 MRTTs.

Airbus Military is the only military and civil transport aircraft manufacturer to develop, produce, sell and support a comprehensive family of airlifters ranging from three to 37 tonnes of payload. Within Airbus, Airbus Military is responsible for the A400M programme, as well as for military tanker transport derivatives based on Airbus civil aircraft, with the integration of the state-of-the-art flight-refuelling boom (ARBS) which is unique in its class.

With the C-295, CN-235 and C-212, Airbus Military is the global leader in the market segments for light and medium-sized military transport aircraft. Altogether Airbus Military has sold more than 1,000 aircraft with over 650 flying with more than 100 operators worldwide.

-ends-

[buglerbilly]

Boeing: Our KC-X Entry Has Lower Lifecycle Cost

Posted by Bradley Peniston | July 18th, 2010


Boeing's 767-based tanker (Boeing photo)

By JOHN REED, LONDON – Boeing’s bid on the U.S. Air Force’s $35 billion KC-X competition is both “cost-effective and financially responsible,” Dennis Muilenburg, CEO of the company’s Defense Space and Security (DSS) division, told reporters here July 18.

While Muilenburg remained tight-lipped about virtually all details of the Chicago-based defense giant’s 767-based bid, he revealed that the company is betting on the 767’s relatively low lifecycle costs to help beat rival EADS’ A330-based tanker in the competition. Some expect the EADS bid will be lower than Boeing’s offer.

On the eve of the Farnborough air show, Muilenburg would not directly say whether Boeing’s sticker price would beat EADS’ subsidized aircraft. All the CEO would say is that the U.S. Air Force is “a very important customer to us” for whom the Chicago company has put “a solid bid on the table” at an aggressive price that also maintains the company’s fiscal responsibilities to its shareholders.

He would not elaborate on the pricing other than to say the jet will costs billions of dollars less in lifecycle costs compared to the European plane, in large part because the 767 burns roughly 24 percent less fuel than the A330. Product support costs such as fuel and maintenance spending account for up to 70 percent of the true cost of a weapon, said Muilenburg.

Boeing and its U.S. allies have worried that EADS will take advantage of its European government financial backing to undercut Boeing’s 767-based NewGen tanker in the competition; even if that means the European defense giant will not make a profit on the initial sale of the 179 aircraft.

This comes as the U.S. company is moving to gain up to 25 percent of its defense-related revenue from international contracts over the next five years, in part to help offset the sharp downturn in U.S. defense spending, according to the CEO.

With no major U.S. aircraft buys guaranteed toward the middle and end of the decade, Boeing is hoping to keep its F/A-18E/F Super Hornet, F-15 Eagle and C-17 Globemaster III lines humming through the years with various international sales, especially in the Middle East, Africa and Asia, said Muilenburg.

Boeing expects to bounce back from the flat revenue of 2010, caused in large part by spending cuts unveiled in 2009 by U.S. Defense Secretary Robert Gates, with a slight uptick in revenue for the coming year due to international growth, he added.

One example of this is a pending deal for 10 C-17s to India that the company hopes to sign sometime in the next year. This sale would keep the Globemaster line open through 2013, giving the company additional time to find new international customers for the strategic airlifters, according to Muilenburg.

Without the Indian order, the C-17 line will shut down at the end of 2012, the CEO said.

Still, the CEO admitted that the company’s plan to grow international revenue to 25 percent is partially reliant on the U.S. streamlining its export control regulations.

“It’s an enabler,” said Muilenburg — several times — of the role export reform has in helping the company sell its products globally.

The flattening of U.S. defense budgets is shrinking research and development funding, a trend that may hurt the defense industry’s ability to generate cutting-edge technology, Muilenburg said.

“If you go back 20 years ago, we had double-digit numbers of new development programs,” said Muilenburg. “If you look back over the last decade, that’s dwindled to just a handful of new large scale programs and if you look forward over the next 10 years, there are very few large-scale development programs”

This is forcing Boeing and its competitors to spend their own money to keep advanced research projects alive for the near term, said Chris Raymond, Boeing DSS’ vice president for business development during the press conference. That model, however, “is probably not sustainable,” he said.

In the meantime, Boeing will rely in part on sustainment and upgrade contracts for its existing products used around the globe to lessen the impact of drought of new U.S. programs, said Raymond.

[buglerbilly]

EADS: We Intend To Make Money on KC-X

Posted by Bradley Peniston | July 18th, 2010



By PIERRE TRAN, LONDON – EADS wants to make money out the U.S. Air Force tanker deal and is ready to lose the competition rather than pocket a loss, chief executive Louis Gallois said ahead of the Farnborough airshow.

“We want to make money on this program,” Gallois told journalists July 17 here. “I’d prefer to lose rather than not to gain money.”

He said EADS has a profitability target for supplying its militarized A330 multirole tanker and transport aircraft and has set its price accordingly.

“I think we will be competitive,” he said.

Winning the KC-45 competition would be of strategic importance, “but we can live without it,” he said.

Gallois said EADS has a good chance to win against archrival Boeing because the European company has put much of the development and risk work behind it.

He said the aircraft offered in the U.S. competition is 90 percent common with the plane being delivered to the Royal Australian Air Force later this year.

EADS wants to increase its presence in the U.S. market, which is half the world’s military market and holds leading technologies, he said. The group wants to be known as an American citizen for making military aircraft, he said.

The Pentagon has shown itself to be evenhanded in the tanker competition, Gallois said.

“I am extremely impressed with the Pentagon,” he said. “The Pentagon is sticking to an extremely fair and professional process.”

He added, “They wish competition to get the best price and the best product. I am very impressed by that. We will have a fight in Congress; that’s different.”

[buglerbilly]

DATE:18/07/10

SOURCE:Flight Daily News

FARNBOROUGH: Alabama keeps fingers crossed over oil-spill impact

By Kerry Reals

State of Alabama officials are keeping their fingers firmly crossed that the region's aerospace industry will remain unaffected by the BP oil spill, and that EADS will win the US Air Force's KC-X tanker contract and bring much-needed jobs to Mobile.

Troy Wayman, vice-president of economic development at the Mobile area Chamber of Commerce, says the devastating oil slick caused by the explosion of BP's Deepwater Horizon offshore rig in the Gulf of Mexico in April has so far "had no detrimental impact on the aerospace industry".

He adds: "The only fear is if it affects shipping for raw materials, but I don't see that happening. I'm confident aerospace will be an industry that is insulated from the impacts of the oil spill." However, Wayman is concerned that the oil slick could have an impact on "the perceived quality of life here" and may impede the ability to recruit qualified aerospace employees to the region.


© Airbus Military

While the fingers of Wayman's right hand remain crossed for aerospace to escape the after-effects of the oil spill, he is also crossing the fingers of his left hand in the hope that EADS's bid for the KC-X tanker will be successful. He says the US government's decision to overturn the contract award to EADS and Northrop Grumman was "heartbreaking", but is confident that EADS's new, standalone bid will be selected over the Boeing bid, which he describes as "just a Powerpoint presentation at this time".

EADS plans to locate its manufacturing facility for the tanker at Brookley Field in Mobile, creating more than 1,000 jobs for the region. "The project would be not only the crown jewel of our aerospace industry but also a game-changer for the region," says Wayman. "It's a price shoot-out and we're standing shoulder-to-shoulder with EADS."

The State of Alabama will be using its exhibit at the show to promote Brookley Field as a "unique asset" of its aerospace industry. "We'll be specifically targeting folks connected with the tanker project as well as other projects not related to the tanker," says Wayman.

[buglerbilly]

Boeing Mum On Glass Cockpit

By Colin Clark Monday, July 19th, 2010 9:49 am

It’s a major addition to Boeing’s entry in the tanker competition — perhaps the biggest change — but Boeing is keeping information about the glass cockpit very close to its chest.

One source tells us categorically that Boeing did not include the cockpit in its bid. We pressed Boeing spokesmen on the issue and they referred us to the July 9 press statement announcing their bid. It says their new tanker includes “a digital flight deck featuring Boeing 787 Dreamliner electronic displays and a cockpit-design philosophy that places the pilot in command rather than allowing computer software to limit combat maneuverability.”

DoD Buzz filmed the cockpit of the new 787 here at Farnborough and we spoke with Boeing officials about the cockpit. It is clearly a highly sensitive issue for them as they have proven deeply reluctant to discuss any details of the cockpit, especially the risks — or lack thereof– of integrating the new systems on the 767. It is, they aver, competition sensitive.

One Boeing source pointed us to the press release and said, “that’s as far as we will go.”

The key issue seems to be whether the cockpit will be shifted to the new tanker in toto or whether some “displays” will come from the 787 Dreamliner.

Buzz readers who know something about the cockpit are encouraged to better inform us and the taxpaying public as to just what is at stake here and why.

Meanwhile, Boeing continued to hammer away at the larger size and weight of the EADS NA offering, the modified A330. It is, Boeing tanker guru Chuck Johnson noted during his briefing today, 40 tons heavier than the Boeing offering. With that comes higher fuel costs and swelling milcon costs, Boeing claims. Below, you’ll find a short film illustrating Boeing’s main points.

Read more: http://www.dodbuzz.com/2010/07/19/boeing-mum-on-glass-cockpit/#ixzz0u8WCiD3b

[buglerbilly]

Boeing: Italian Tankers Ready For Final Checks

Posted by Bradley Peniston | July 20th, 2010

By TOM KINGTON, FARNBOROUGH, UK – Following a series of technical problems that have delayed Boeing’s delivery of four 767 tankers to Italy, the firm and its customer appear optimistic that the hitches are behind them and that deliveries are pending.

After first promising delivery in 2005, Boeing needed to fix a vibration problem with a wing pylon on the aircraft and then tackle a stability problem on the centerline hose and drogue.

The final procedure before handover, the so-called Tender for Acceptance in which Italian crews check the aircraft, has repeatedly slipped.

That procedure has still not started, but Boeing spokesman Bill Barksdale said on July 20 that the ball was now in Italy’s court.

“We are ready for the TFA to begin and we are talking to the Italian government to hear when they want to start, how much time they want and what it will involve, all of which will determine when deliveries start. We believe the TFA will start this summer,” he said.

Asked if all the technical problems had been resolved, he replied, “We are ready to go.”

A senior Italian defense official was cautiously optimistic.

“We hope the TFA will start soon, and hope to have two deliveries by the end of the year with all capabilities as ordered,” he said.

[buglerbilly]

Airbus Military: UK Tanker to Fly By September

Posted by Bradley Peniston | July 21st, 2010

It really wouldn't surprise me if France and the UK come to some Share Agreement with this fleet to the benefit of both.........

By PIERRE TRAN, FARNBOROUGH, UK – A first flight of the A330 multirole tanker and transport (MRTT) aircraft ordered for Britain’s Future Strategic Tanker Aircraft (FSTA) program is due before the end of the third quarter, said Antonio Caramazana, Airbus Military vice president, head of Airbus military derivatives.

Flight trials of the second FSTA aircraft is expected “soon after,” Caramazana told journalists July 19 at the Farnborough Airshow. That is expected to be around two months after the flight of the first aircraft, a source familiar with the program said.

Britain used a public-private partnership in the FSTA program to provide in-flight refueling capability for the Royal Air Force.

Airbus Military, a unit of EADS, described the MRTT aircraft as relatively mature, pointing to the imminent delivery of the first units to Australia.

Two MRTT aircraft for the Royal Australian Air Force are currently in flight test, with a first delivery scheduled before the end of the year. A third aircraft is undergoing conversion in Brisbane. Australia has ordered a total five aircraft.

In the flight test program, the MRTT has made more than 1,000 contacts on the aerial refueling system with a variety of military aircraft. Some 921 contacts were made with the fixed fuel boom, and 219 using the hose and drogue system from the wings by mid July.

The program of in-flight refueling tests includes 419 contacts with an F-16 fighter, 219 with an F-18 and 21 with the AWACS eye in the sky aircraft. A further 481 contacts were made with A310 and A330 aircraft, and a KC-135 tanker transferred fuel 19 times with the MRTT.

Some 350 tons of fuel has been transferred in the tests.

One MRTT is being converted for the United Arab Emirates, and one unit will also undergo conversion for Saudi Arabia, in the Getafe facility near Madrid.

EADS submitted its offer of the MRTT, a militarized A330, for the U.S. Air Force tender for the KC-X tanker aircraft July 8.

[buglerbilly]

DATE:21/07/10

SOURCE:Flight Daily News

FARNBOROUGH: Boeing hints at KC-767 NewGen Tanker design

By Stephen Trimble

In a huddle with reporters after a press briefing, a Boeing executive offered the most tangible hint to date that the KC-767 NewGen Tanker blends major structural components from different aircraft models.

Charles Johnson, Boeing vice president of air force mobility, told reporters during the briefing that it will not be "easy" for EADS North America to adapt the KC-45 with cockpit armour and defensive systems.

Asked afterward if Boeing could reassure the public that the KC-767 NewGen Tanker would require less challenging design changes, Johnson said he could.


©Boeing

A reporter noted that Boeing's KC-767 design featured a wing and fuselage from different aircraft models, which would seem to pose a greater redesign challenge than integrating defensive systems and cockpit armour.

Johnson replied that "it's pretty straightforward actually" to install a wing from a different model on to the 767-200 fuselage.

Johnson cited the example of the Boeing P-8A programme, which matches the wing of the 737-900ER to the fuselage of the -800 and is built in-line rather than modified afterward.

That was the closest Boeing has come to revealing details of the structural design of the KC-767 NewGen Tanker. In the last round of the KC-X competition, Boeing faced criticism for blending elements of three different 767 models into the so-called "frankentanker".

A day earlier, Boeing executives at a media roundtable pointedly declined to link the experience on the P-8A programme to the NewGen Tanker design, saying that doing so would be giving away competitive information.

Instead, Dennis Muilenburg, offered only one other key detail about the NewGen Tanker.

In response to questions, Muilenburg revealed the KC-767 NewGen Tanker includes a boom based on the hardware of the KC-10 and upgraded with fly-by-wire controls developed for the KC-767s purchased by Italy and Japan.

Boeing had previously indicated the system includes fly-by-wire, but had not disclosed the system for KC-X came from the Italian and Japanese tankers.

It seems a small detail, but it's one of the few specific disclosures that Boeing has allowed to be released in the intense competition for a contract award to build up to 179 tankers.

[buglerbilly]

DATE:21/07/10

SOURCE:Flight Daily News

FARNBOROUGH: Airbus ministers keep the heat on WTO

By Graham Dunn

European ministers representing the nations behind Airbus joined the attack on the delay in the World Trade Organisation's verdict on alleged subsidies for Boeing commercial aircraft.

Last month, the WTO finally ruled that Airbus received illegal subsidies from European governments, a decision that Boeing says proves its rival is competing unfairly and invalidates its attempt to sell A330-based tankers to the US military.

A separate WTO panel is considering a parallel European counter-claim, although its report on whether the US government broke global trade rules will not be published until September at the earliest.


© Airbus Military
Will the WTO ruling damage EADS's attempt to sell A330-based tankers to the US military

Ministers from France, Germany, Spain and the UK, meeting during the Farnborough air show, hit out at the delay and insist the WTO needs to deal with the two cases in a "parallel and balanced way".

UK minister for business and enterprise Mark Prisk says: "It has now been delayed three times. If it were to be seen to be delayed further past September that would be deeply concerning."

His French counterpart, transport secretary Dominique Bussereau, adds: "It does create a disequilibrium. We all deplore the situation. There is a disconnect that we didn't have." EADS chief executive Louis Gallois had earlier described himself as "enormously frustrated" at the latest delay.

While insisting the full story "will only be complete when the second report is issued", ministers add where they do not agree with the first WTO report's findings, it will encourage the EC to make a "robust challenge" through the WTO's appeal process.

Meanwhile, ministers attending the press conference from France, Spain and the UK confirmed previously announced plans of support for the new A350 remain unchanged,

[buglerbilly]

DATE:25/07/10

SOURCE:Flight Daily News

FARNBOROUGH: Antonov awaits USAF response to KC-X bid

By Stephen Trimble

"Not yet". That is the line from Antonov on whether it has received a response to its shock last-minute bid for the US Air Force's KC-X tanker contest early this month.

"This is the first opportunity for us to bid in such a tender in the USA," says Antonov president general designer Dmitry Kyva. Teamed with US Aerospace, it has submitted a bid based on the proposed An-112KC.

"It is very difficult for us to evaluate our chances," he says, but adds: "Our aircraft meets all the requirements."

Kyva describes the Ukrainian company's surprise venture into the 179-aircraft KC-X battle as "a new experience". It hopes to receive a response allowing it to go forward in the contest, against the Boeing KC-767 NewGen Tanker and EADS North America KC-45, but he comments: "We will not be too upset if we don't."

[buglerbilly]

DATE:27/07/10

SOURCE:Flight International

Boeing goes on new KC-X offensive

By Stephen Trimble

Boeing launched a new rhetorical offensive in the KC-X contract battle at Farnborough, reviving old criticisms about its rival's approach to hard envelope protection and non-feedback sidesticks.

Charles Johnson, Boeing vice-president of mobility, charged that the bedrocks of Airbus's cockpit philosophy would place military pilots in danger.

In response, EADS North America, which has proposed an Airbus A330-200 modified into the KC-45 tanker, shot back that the KC-767 NewGen Tanker poses the greater risk to pilot safety.


"Boeing is clearly raising these red-herring issues in an attempt to distract from its lack of a tanker and from the considerable risk it is offering the [US] Air Force by proposing a tanker that only exists on paper," EADS NA says.

The new debate aggravated the rhetoric on both sides of the debate, which had previously been mostly characterised by bickering over fuel capacity and commercial aircraft subsidies.

In marketing videos, Boeing had boasted about how the KC-767 is designed to give pilots full control to manoeuvre the aircraft in any situation, such as dodging a missile attack.

But company officials had so far refrained from directly criticising the Airbus hard envelope protection system, which is designed to limit the pilot's ability to manoeuvre the aircraft beyond preset limits.


The KC-767, by contrast, gives the pilot "complete, full access to the aircraft envelope", Johnson says, adding: "The pilot can always override" limits set by the flight controls.

"You want to be able to make [certain manoeuvres] and not always be limited," Johnson says.

EADS NA says that pilots in the A330 multi-role tanker transport - on which the KC-45 is based - are not limited to making any manoeuvre that they would need in combat.

Johnson also criticises the Airbus use of sidesticks that provide no feedback response to pilots. Boeing yokes are back-driven, allowing the pilot to feel a response from the flight controls even in a fly-by-wire aircraft.


"Boeing's condemnations of fly-by-wire technology are puzzling, given its extensive use of the same technology in many of its own military aircraft, and the air force's use of sidestick in some of its most successful aircraft," EADS NA says.

[Chunder]

The thing that arises in my head about Boeing and 'Full authority control" Reminds me of barrel rolls in 707's, b47's & B-52's...

AFAIK Full Authority has probably resulted in more needless deaths / dismissals through show casing an aircrafts "agility" than without. Admittedly before computers...

Which begs the statement, which fucking idiot somewhere is dreaming of the day that a BOEING pilot miraculously saves his pig assed tanker, with a top gun style barrel role saving the aircraft from a missile designed to shoot down fighters?

Assuming even if in the incontestably small likelihood of it happening, (let along more than once), what's the point of factoring it in, who gives a shit? You may (hah) loose an aircraft.
Hardly a selling point on the scale of the contract...

[Unicorn]

It's Boeing, a logic free zone at the best of times, which these are not.

Unicorn

[buglerbilly]

U.S. Aerospace Protests KC-X Source Selection

Aug 4, 2010



By Amy Butler abutler@aviationweek.com

The Pentagon is assessing only two bids for the U.S. Air Force KC-135 replacement competition because a last-minute proposal from U.S. Aerospace/Antonov was not received before the deadline, according to Geoff Morrell, Pentagon press secretary.

This has sparked a protest from U.S. Aerospace filed Aug. 2 with the U.S. Government Accountability Office (GAO). Company officials say that the “conduct of the Air Force was unreasonable,” among other complaints, according to an industry executive. They claim that personnel at the Aeronautical Systems Center at Wright-Patterson AFB, Ohio, where the KC-X program office is located, discriminated against their bid.

Bids for the KC-X competition, estimated to be worth about $35 billion for 179 tankers, were due at 2 p.m. July 9 local time at Wright-Patterson AFB, Ohio (which is in the Eastern time zone). EADS submitted its proposal a day early, and dispatched two copies — one by air and one by ground — to be sure it arrived. Boeing’s submission was received at around 9 a.m. July 9, according to Morrell. “Those deadlines count,” he says. “They mean something. They are there for a reason and any professional contractor knows that.” Both EADS and Boeing said their proposals were more than 8,000 pages in length.

According to an industry executive, a messenger carrying a bid from U.S. Aerospace arrived at the Wright-Patterson gate at about 1:30 p.m., 30 minutes before the deadline. “Air Force personnel intentionally denied the messenger entry to the base” and later provided “incorrect directions,” and forced the messenger to wait when he got turned around. The proposal was marked 2:05 p.m., but this executive says that the bid was under Air Force control prior to that time

Morrell, however, stands by the Pentagon’s view that the proposal was not received on time. “This is a $30-40 billion bid,” he says. “This is not a high school homework assignment. Deadlines count here.”

U.S. Aerospace/Antonov had requested an extension to the proposal due date, but that was declined by the Pentagon. On March 31, the Defense Department had already extended the deadline by 60 days to provide time for EADS to prepare its bid. Its longtime teaming arrangement with former prime contractor Northrop Grumman ended abruptly in March, forcing the company to step up in the prime role at the last minute.

“The proposal was late and by law we are not allowed to consider it,” Morrell said in response to a query from AVIATION WEEK. “We are considering two proposals and U.S. Aerospace is not one of those being considered.”

Chuck Arnold, a senior advisor to U.S. Aerospace, says the company is proposing an An-112 concept based on the four-engine An-70 transport. The design features a boom capable of offloading 1,600 gal. per minute (more than the 1,200 gal. per minute required by the Air Force), and he boasts that it would be far less expensive than the Boeing 767-based design or the EADS A330-200 tanker platform.

Arnold declined to identify the boom manufacturer or any U.S. partners other than U.S. Aerospace, a small firm based in Southern California that was to be prime; he citied a nondisclosure agreement with Antonov. Antonov is a state-owned manufacturer in the Ukraine, but Arnold insisted, without providing details, that some assembly of the tankers would take place in the United States.

The eleventh-hour emergence of the U.S. Aerospace/Antonov bid sparked many questions. U.S. Aerospace is a small company; in Securities and Exchange Commission (SEC) filings the company has listed about 30 employees. It is not clear how such a small contractor would be able to manage a massive contract and supply chain, though Arnold touts the small company size as a benefit in lean management.

Additionally, the company has recently had financial problems, including debt. Arnold notes that board members recently secured an influx of funding to “clean up the books,” but this, too, calls into question the ability of the firm to manage a major Defense Department contract. A July 1 SEC filing notes additional cash on hand.

A new board of directors took over the company in March, renaming it from New Century to U.S. Aerospace and shifting the focus to address only aerospace products.

However, the company seemed even in its July 1 SEC filing to be aware that it may not meet the requirements called for by the Air Force. To compete in KC-X, each bidder must meet 372 mandatory requirements and demonstrate its ability to manage the contract. The Pentagon’s denial for the bid extension was “resulting in a significantly more rushed process than we desired, and substantially hindering our ability to submit a full and complete bid package,” according to the July 1 SEC filing from U.S. Aerospace. “The Air Force may find that our proposal does not meet all mandatory RFP requirement, that we do not have qualified subcontractors and teaming partners, that we are not a capable and responsible contractor, that we have not obtained or processed the classified information that is needed to prepare a proposal, that we have not demonstrated that the company has the facility and personnel clearances that are prerequisites to receiving, handling and storing classified information, and that our failure to meet the proposal submittal deadline was attributable to our failure to act diligently and promptly.”

Arnold says that “If our plane is looked at, we will be selected,” adding that he expects “obstacles” for the company in competing.

The Air Force’s tanker pursuits have been years in the making. A 2002 attempt by the service to lease Boeing 767 tankers crumbled after Sen. John McCain (R-Ariz.) found bloated pricing and began an investigation that eventually led to jail time for former senior Air Force procurement official Darleen Druyun and former Boeing Chief Financial Office Michael Sears.

A later competition won by Northrop Grumman/EADS was thrown out after a Boeing protest uncovered missteps by the Air Force during the source selection process. More recently, Defense Secretary Robert Gates himself stepped in last year to table a new competition; he called for a “cooling off” period between the contractors.

The current competition is the Air Force’s most recent attempt to replacing aging KC-135s. A downselect is expected in November shortly after the national elections.

Image: Boeing

[buglerbilly]

Background to the above........

Ares

A Defense Technology Blog

Only Two Bids for KC-X -- US Aerospace/Antonov is OUT

Posted by Amy Butler at 8/4/2010 3:53 PM CDT

If you thought the latest KC-X competition couldn't get weirder once the obscure U.S. Aerospace/Antonov bid surfaced last month, you were wrong.

Despite crowing by the U.S. Aerospace advisor, Chuck Arnold, about a KC-X bid, it seems the company didn't dot its i's and cross its t's -- at least not in time.

Bids to compete for the program -- 179 KC-135 replacements estimated to be worth $35 billion -- were due at 2 p.m. EST at Wright-Patterson AFB, Ohio. Apparently, the U.S. Aerospace/Antonov bid didn't make it in time (subscriber only).

"Those deadlines count," says Geoff Morrell, Pentagon press secretary. "They mean something ... They are there for a reason and any professional contractor knows that."

EADS submitted its bid a day early, and dispatched two copies -- one by air and one by land. Boeing's bid was received at about 9 a.m. on July 9, Morrell says. He declined to say when paperwork from U.S. Aerospace/Antonov arrived, if at all.

"The proposal was late and by law we are not allowed to consider it," Morrell says. "We are considering two proposals and U.S. Aerospace is not one of those being considered."

On March 31, the Pentagon announced a 60-day extension to the due date for proposals; EADS requested an extension after its former prime contractor, Northrop Grumman, abruptly walked away from the team. "Any serious bidder had at least 120 days in which to get their bids together," Morrell says.

Arnold, however, insisted as recently as last night to Aviation Week that its company had submitted a bid and "if considered" would win.

He did not promptly return a call for comment about Morrell's statements.

UPDATE: U.S. Aerospace filed a protest with the Government Accountability Office Aug. 2 citing "unreasonable" conduct by the U.S. Air Force. According to an industry executive, the company's messenger arrived at the Wright-Patterson AFB gate at 1:30 p.m. July 9 (30 minutes before the deadline) and was denied entry, given bad directions and told to wait by Air Force personnel. As a result, the Air Force stamped the proposal received at 2:05 p.m.

Could it be that five minutes brings this KC-X schedule to its knees?

[buglerbilly]

USAF Chief: KC-X Award Date Is Firm

By JOHN REED

Published: 4 Aug 2010 15:51 Print | Email

The U.S. Air Force will not further delay the KC-X contract award date, the service's top officer promised Aug. 4.


U.S. Air Force Chief of Staff Gen. Norton Schwartz speaks Aug. 4 to Defense News editors and reporters. (SHEILA VEMMER / STAFF)

"I would be very, very surprised" if the award deadline on the $35 billion contest slips past mid-November, Gen. Norton Schwartz, Air Force chief of staff, said after meeting with the editorial staff of Defense News and Air Force Times. "We're going to come in when we say we are."

Earlier this week, several analysts said that the award date would slip past the new year. The Everett (Wash.) Herald quoted one as saying the "entire process" could be delayed to 2012 because of potential protests by the losing bidder.

In late spring, the Pentagon granted EADS a 60-day extension to the bidding process, allowing the European defense giant to file its offer July 9. At first, the Defense Department said that it would award the contract in September despite the 60-day bid extension.

But the Air Force has since acknowledged that the award date has been delayed until Nov. 12, 10 days after Congressional elections.

EADS is offering a modified version of its Airbus A330 civil jetliner under the KC-45 moniker, while rival Boeing is pitching an upgraded version of its KC-767 tanker dubbed the NewGen Tanker. A team of U.S. Aerospace and Ukraine's Antonov is also bidding several options.

[buglerbilly]

Ares

A Defense Technology Blog

KC-X Due Date: Nov. 10 vs Nov. 12

Posted by Robert Wall at 8/5/2010 3:47 AM CDT

The Government Accountability Office has until November 10 to rule on the protest U.S. Aerospace has filed over being locked out of the KC-X tanker competition.

The protest was formally filed on August 2. The GAO can rule before then, and extensions are also possible, especially if further filings are made in the case, but November 10 currently is the due date for a ruling.

Still unclear is how the deadline may effect the other KC-X target date: November 12; that is when the Pentagon was expected to announce the winner of the source selection process, which currently pits EADS and its A330 against Boeing with its 767 offerings.

Clearly, should the GAO side with U.S. Aerospace, the November 12 target date would have to slip, and a source selection decision this year would appear all but impossible.

If the GAO rules against U.S. Aerospace, the exercise will have been a nice warm up act for the GAO protest that is likely to be filed by the losing bidder in KC-X.

[buglerbilly]

DoD: U.S. Aerospace Protest Won't Force KC-X Delay

By JOHN T. BENNETT

Published: 5 Aug 2010 10:20

A protest filed by U.S. Aerospace alleging the U.S. Air Force unfairly rejected its bid for a multibillion-dollar aerial tanker contract will not force the Defense Department to delay a contract decision slated for this fall, says DoD spokesman Geoff Morrell.


U.S. Aerospace, which launched a bid for the KC-X contract to replace the aging KC-135, has filed a protest with the Government Accountability Office. (Air Force)

"I can tell you the awarding of this contract is still scheduled for this fall," Morrell told Defense News in an Aug. 5 e-mail.

U.S. Aerospace, which earlier this summer launched a long shot bid for the KC-X contract with Ukrainian aircraft firm Antonov, on Aug. 4 announced it had filed a protest with the Government Accountability Office.

The California-based firm is alleging U.S. Air Force officials "intentionally" took steps designed to allow them to reject their tanker bid.

In documents released by U.S. Aerospace, company officials state a messenger arrived on July 9 at Wright-Patterson Air Force Base, Ohio, to deliver their bid "well before 1:30 pm, more than half an hour before the 2:00 pm deadline," according to the documents.

The company alleges the messenger was initially denied access to the base, and later given incorrect directions to the bid drop-off location.

The messenger "at all times complied with the instructions of Air Force personnel, from the time he arrived at the installation until the proposal was taken by Air Force personnel at the program building," according to the company documents. "Although the proposal was arbitrarily marked received at 2:05 pm, it was under Air Force control before the bid deadline."

That essentially is the cornerstone of the U.S. Aerospace protest.

Federal acquisition regulations state "that a proposal received after the time specified for receipt of offers will be considered if certain conditions are met and 'it was received at the Government installation designated for receipt of offers and was under the Government's control prior to the time set for receipt of offers,'" the U.S. Aerospace documents said. "Our proposal was received at the Government installation designated for receipt of offers, i.e. Wright-Patterson Air Force Base, and was effectively under the Government's control prior to 2:00 pm, the time set for receipt of offers, because the messenger was following the instructions of Air Force as to what to do and where to go with the proposal. Accordingly, the proposal should be considered as part of the source selection."

The company also is alleging Air Force personnel are biased against Antonov.

"Our bid protest also alleges that certain Air Force personnel may have intentionally delayed the messenger from delivering our proposal, in order to create a pretext for refusing to consider it because they have political issues with our Eastern European supplier, thus violating the requirement that the program be a fair and equal competition, open to all qualified bidders," according to the documents.

The California aircraft parts manufacturer also questions the "conduct" of some Air Force officials.

"The conduct of some Air Force personnel - such as repeatedly leaking information to the press, granting one bidder [EADS] a 60-day extension but denying any extension to [U.S. Aerospace], intentionally delaying advising us that it would not be granted an extension, and intentionally delaying sending us the information disks needed to prepare the proposal - give rise to an appearance of impropriety regarding the conduct of some members of the Air Force," according to the documents.

Pentagon and Air Force officials expect to award a contract in mid-November.

Morrell's statement about the protest having no impact on those plans match comments made 24 hours earlier by Air Force Chief of Staff Gen. Norton Schwartz.

"I would be very, very surprised" if awarding of the 179-plane, $35 billion contract is delayed beyond mid-November, Schwartz said after meeting with Defense News and Air Force Times editors and reporters. "We're going to come in when we say we are."

[buglerbilly]

Ares

A Defense Technology Blog

US Aerospace/Antonov: A Peek at the KC-X Protest

Posted by Amy Butler at 8/5/2010 1:58 PM CDT

The Government Accountability Office is now reviewing the Aug. 2 protest filed by US. Aerospace/Antonov.

The company is claiming it was unfairly shut out of the competition. And, the crux of this argument will likely boil down to the type of discussion that former President Bill Clinton had when he said "it depends on what the definition of 'is' is."

At issue is when USAF took control of the proposal documents submitted by U.S. Aerospace. All of the following detail was provide from an industry executive who wished to be anonymous due to the sensitivity of the issue.

The company claims its messenger, which was delivering the proposal was at the Wright-Patterson Area B gate before 1:30 p.m. July 9. The deadline was 2 p.m. that day.

According to the company, Air Force personnel at the gate "initially denied the messenger entry to the base, then gave incorrect direction to the 1755 Eleventh Street Building 570," where the proposal was headed. The messenger apparently became lost, and Air Force personnel told him to wait while they came to him.

By the time the papers reached their destination, the Air Force stamped the proposal as being received at 2:05 p.m.

U.S. Aerospace was notified July 22 via a letter from the Aeronautical Systems Center at Wright-Patt that the company's bid was late and would not be considered as part of the source selection.

So, one of the questions that is likely to be addressed as GAO reviews the protest is at what point the USAF had "control" over the proposal.

Was it when the messenger stepped onto the base? I'd suspect that when it comes to matters of security, the Air Force would say its personnel have control over all people on their bases. When it comes to a contracting matter, it may be different.

Apparently, Air Force officials subsequently told a company representative that delays at installation gates are common (and they are -- I've been subject to more than a few), and that the company should have anticipated this potential snag and planned appropriately.

But, the U.S. Aerospace argument is that Air Force personnel "intentionally delayed the messenger from delivering the proposal in order to create a pretext for refusing to consider it because they have political issues" with the principal supplier, Ukrainian state owned Antonov, according to the industry executive.

If this is proven to be true, it will bring the KC-X competition and the entire U.S. Air Force acquisition system to its knees after and already rough decade of missteps and scandals.

Another issue likely to arise during the review process is whether the Air Force was responsive to requests from U.S. Aerospace to the classified documents required to provide a fully compliant bid.

The U.S. Aerospace argument is that the Air Force took a week or more to provide the documentation required for the company to respond to its bid. The Air Force, however, has a rigid process for such communications and asked the company to resubmit its request through an official process channel. The net result was that the company had less time to review the materials and respond to the RFP.

On this matter, the Air Force is likely to argue that the processes for bidders are set -- as laid out in the FAR -- and the service is unable to budge from them.

UPDATE: During an Aug. 5 press conference, Pentagon Press Secretary Geoff Morrell said it was "absolutely absurd" to think USAF personnel intentionally delayed the U.S. Aerospace messenger. He also noted that Boeing and EADS "went to great measures" to ensure their bids arrived on time. "Any professional contractor understands how hard and fast these deadlines are and go through extraordinary measures to get their proposals in on time," he said.

[buglerbilly]

Ares

A Defense Technology Blog

U.S. Aerospace Not the First Contractor To Be Accused of Tardiness

Posted by Amy Butler at 8/5/2010 2:30 PM CDT

The Government Accounting Office is now in the process of assessing the claims made against the Air Force by U.S. Aerospace, the would-be KC-X competitor who claims that service personnel delayed receipt of its proposal.

At issue is whether the team -- US Aerospace and Antonov -- got their bid for the $35 billion KC-X competition to the proper office at Wright-Patterson AFB, Ohio, on time: 2 p.m. July 9.

The team says a messenger arrived more than 30 minutes prior to the deadline; the Air Force stamped the document as received at 2:05 p.m.

Surprisingly (to me, at least) there is a healthy body of case law on this issue, according to Ralph White, GAO's managing associate general counsel for procurement law. He says there are actually many cases reviewed for timeliness issues over the past 50 years the GAO has been handling protests.

So, this means there will be plenty of case law from which both sides can draw as they make their arguments on the matter.

White also outlined the schedule for this protest. Significant deadlines (which, like KC-X cannot be slipped to the right) are:

*The U.S. Air Force has 30 calendar days to file its argument in response to the U.S. Aerospace protest. White says the Air Force can submit is response early if it wants to hasten the process.

*U.S. Aerospace then has 10 calendar days to file a response to the Air Force’s arguments.

*If a hearing is required, a date would be established thereafter.

*A resolution must be reached within 100 calendar days.

Alternatively, the two parties also have the option of entering into alternative methods of dispute resolution, such as a mediator. This, however, is unlikely given the high stakes of this protest.

[Deks]

Very clever. I suppose the messenger would have had an electronic organiser to sign which would settle it once and for all. I suspect that if they did, it wouldn't be this far along though.

[buglerbilly]

Ares

A Defense Technology Blog

US Aerospace/Antonov: A Peek at the KC-X Protest [Updated]

Posted by Amy Butler at 8/6/2010 8:58 AM CDT

The Government Accountability Office is now reviewing the Aug. 2 protest filed by US. Aerospace/Antonov.

The company is claiming it was unfairly shut out of the competition. And, the crux of this argument will likely boil down to the type of discussion that former President Bill Clinton had when he said "it depends on what the definition of 'is' is."

At issue is when USAF took control of the proposal documents submitted by U.S. Aerospace. All of the following detail was provide from an industry executive who wished to be anonymous due to the sensitivity of the issue.

The company claims its messenger, which was delivering the proposal was at the Wright-Patterson Area B gate before 1:30 p.m. July 9. The deadline was 2 p.m. that day.

According to the company, Air Force personnel at the gate "initially denied the messenger entry to the base, then gave incorrect direction to the 1755 Eleventh Street Building 570," where the proposal was headed. The messenger apparently became lost, and Air Force personnel told him to wait while they came to him.

By the time the papers reached their destination, the Air Force stamped the proposal as being received at 2:05 p.m.

U.S. Aerospace was notified July 22 via a letter from the Aeronautical Systems Center at Wright-Patt that the company's bid was late and would not be considered as part of the source selection.

So, one of the questions that is likely to be addressed as GAO reviews the protest is at what point the USAF had "control" over the proposal.

Was it when the messenger stepped onto the base? I'd suspect that when it comes to matters of security, the Air Force would say its personnel have control over all people on their bases. When it comes to a contracting matter, it may be different.

Apparently, Air Force officials subsequently told a company representative that delays at installation gates are common (and they are -- I've been subject to more than a few), and that the company should have anticipated this potential snag and planned appropriately.

But, the U.S. Aerospace argument is that Air Force personnel "intentionally delayed the messenger from delivering the proposal in order to create a pretext for refusing to consider it because they have political issues" with the principal supplier, Ukrainian state owned Antonov, according to the industry executive.

If this is proven to be true, it will bring the KC-X competition and the entire U.S. Air Force acquisition system to its knees after and already rough decade of missteps and scandals.

Another issue likely to arise during the review process is whether the Air Force was responsive to requests from U.S. Aerospace to the classified documents required to provide a fully compliant bid.

The U.S. Aerospace argument is that the Air Force took a week or more to provide the documentation required for the company to respond to its bid. The Air Force, however, has a rigid process for such communications and asked the company to resubmit its request through an official process channel. The net result was that the company had less time to review the materials and respond to the RFP.

On this matter, the Air Force is likely to argue that the processes for bidders are set -- as laid out in the FAR -- and the service is unable to budge from them.

UPDATE: During an Aug. 5 press conference, Pentagon Press Secretary Geoff Morrell said it was "absolutely absurd" to think USAF personnel intentionally delayed the U.S. Aerospace messenger. He also noted that Boeing and EADS "went to great measures" to ensure their bids arrived on time. "Any professional contractor understands how hard and fast these deadlines are and go through extraordinary measures to get their proposals in on time," he said.

UPDATE: I neglected to link to U.S. Aerospace's own press release. The company says its price is $29.5 billion (far below the estimate of $35 billion). And, this amounts to about $150 million per aircraft. Details, though, are scant.

[Deks]

Yep, there's good reason why Boeing and EADS had their bids in the day before.

[buglerbilly]

KC-X Bidder Dialogue Begins Despite Protest

Aug 12, 2010



By Amy Butler

The U.S. Air Force has begun the formal process through which the service communicates with KC-X bidders about their proposals in preparation for picking a winner, according to officials familiar with the process.

This signals that the service is proceeding with its KC-135 replacement source selection despite the protest launched last week by would-be bidder U.S. Aerospace, which teamed with Ukrainian state-owned Antonov to pitch a modified An-70 tanker. U.S. Aerospace claims in its Aug. 2 protest that Air Force personnel deliberately delayed a messenger carrying the proposal at the security gate at Wright-Patterson AFB on July 9. As a result, the Air Force stamped the proposal as being received five minutes after the due date, and disqualified the company from bidding (Aerospace DAILY, Aug. 5).

The “evaluation notice” (EN) process with Boeing and EADS began Aug. 11, according to these officials. Through these ENs, the Air Force will conduct formal communications with the companies about their bids. This is a very structured procedure in which queries are asked and answered in writing through designated personnel; conversations with bidders at this point are kept to a minimum to avoid any unintentional bias for or against either entrant. Following this course will be key for the Air Force to avoid the overturning of the source selection if the losing bidder launches a protest.

The Pentagon plans to announce a winner around Nov. 12 for the competition to build 172 tankers, work estimated to be worth about $35 billion. This schedule would change if the Government Accountability Office upholds U.S. Aerospace’s protest, which is to be ruled upon by Nov. 10.

Boeing is proposing a 767-based tanker, while EADS is offering its A330-200-based model.

Photo: Boeing

[buglerbilly]

Indian Exec: Firm May Sue Airbus Over Delayed A330s

By VIVEK RAGHUVANSHI

Published: 16 Aug 2010 15:16

Curious little story BUT don't read too much into it................

NEW DELHI - India's only long-haul cargo airline, Flyington Freighters, Hyderabad, is threatening to sue Airbus for the delayed delivery of 12 A330-200 cargo aircraft.

A senior Flyington executive said the delays have caused financial hardships for the airline. Deliveries of the A330-200 were expected to begin in July 2008, but now, he said, Flyington fears the slippage will spill over into 2011.

Attempts to reach Airbus and EADS officials here for response were not successful.

Delay in awarding the U.S. Air Force tanker contract may be behind the delivery delays, the executive said. "I believe Airbus intended to deliver the 12 A330-200 aircraft to Flyington only if successful in winning the U.S. Air Force contract and able to build these aircraft in Mobile, Alabama," where Airbus has pledged to build the U.S. aircraft if it wins that deal, he said. "My impression is that Airbus has only limited capacity in Toulouse and may be unable to build our 12 A330-200 aircraft [there]."

EADS North America is pitching the KC-30 converted tanker/freighter, a version of the A330-200 passenger aircraft, in the U.S. Air Force contest. Rival Boeing is offering the KC-767 Advanced Tanker, a modified version of its 767-200 long-range freighter.

Airbus, the Flyington executive said, wanted orders for the A330-200 to prove its viability to the U.S. Air Force.

"In hindsight, Airbus's aggressive pursuit of Flyington appears to have been driven by Airbus's strong interest in securing an A330-200 launch customer to unlock European Union launch air support and demonstrate to the U.S. Air Force that Airbus had a viable commercial variant for its proposed tanker," he said.

Flyington's planned commercial operations from India to destinations throughout Europe, West Asia and Africa now face uncertainty because of the delayed deliveries, the executive said.

Flyington Freighters initially entered discussions with Boeing for the purchase of freighter aircraft, but it later switched to Airbus and in March 2007 ordered six A330-200s, which were scheduled for delivery beginning in July 2008.

"We held preliminary talks with Boeing, but opted for an Airbus fleet of freighters because the A330-200F offers low operating costs and significant operational benefits," the Flyington executive said. "The aircraft gives Flyington Freighters a solid springboard for success in the rapidly expanding Indian freighter market."

[buglerbilly]

Ares

A Defense Technology Blog

U.S. Aerospace Protest on the Fast Track

Posted by Amy Butler at 8/18/2010 3:38 PM CDT

The Government Accountability Office (GAO) has agreed to an expedited review process for the protest launched by would-be KC-X bidder U.S. Aerospace against the Air Force.

The outcome will now come in 65 days rather than the 100 days that is standard for most procurement protests. A decision is now expected Oct. 6, according to GAO. This will fall well in advance of the Pentagon's planned downselect on Nov. 12.

A few days into the protest, the Air Force requested the use of “express option procedures,” which are allowable under GAO regulations, says Ralph White, managing associate general counsel for procurement law at the GAO. Air Force officials have declined to answer media questions about the protest despite repeated requests.

Granting the expedite request is the sole responsibility and under the sole purview of the GAO, according to White. Unlike Boeing’s protest of a 2008 KC-X award to Northrop Grumman/EADS, which included thousands of pages of documents to review, the U.S. Aerospace protest is “much more straightforward,” he says. The Boeing protest resulted in an overturn of the Northrop contract award, leading to the current competition.

U.S. Aerospace “would have preferred not to use the express option,” White says, but he suggests the key protest issue can likely be resolved quickly.

The company claims that the Air Force intentionally obstructed its messenger from delivering the U.S. Aeropace/Antonov An70-based bid on time by July 9 at 2 p.m. A gate guard delayed the messenger and provided bad directions to the building where the proposals were expected, the company’s protest claims. The Air Force stamped it as received at 2:05 p.m. and subsequently disqualified the company from competing due to the tardiness.

The expedited schedule calls for the Air Force to file its response to the protest claims within 20 days, not 30 days, of the GAO accepting the case for review. That new date is Aug. 26, White says. U.S. Aerospace now has five days, not 10, to provide its final response. White says if the company appeals for more days to respond, it is likely to be granted a small reprieve.

[buglerbilly]

Boeing announces new plant in Illinois but gives no details

By LES BLUMENTHAL
McClatchy Newspapers

WASHINGTON -- Rumors were flying through the nation's defense and aerospace communities Thursday morning as an announcement neared on a new production plant at an airport in southern Illinois. It was no secret that it would be a Boeing plant, but beyond that little was known.

Some speculated that the plant would be used to overhaul retired 747s that the airlines were buying from desert graveyards, where they'd sat for years. Others thought it would be used to convert secondhand 767s into Air Force refueling tankers. There was even speculation that the plant would make parts for Boeing's new 787 Dreamliner.

When the announcement finally came, Boeing had nothing to say about what would be manufactured at the plant at MidAmerica Airport in Mascoutah, Ill.

Given its proximity to Boeing's production facilities in the St. Louis area - and the fact that the head of Boeing's defense, space and security division was at the news conference - there seemed little question that it would be defense-related, however.

Some analysts said it would give Boeing a presence at Scott Air Force Base, whose Air Mobility Command is one of the company's biggest customers.

"If you are a company doing significant business with the mobility command, it makes a lot of sense to have a major presence nearby," said Loren Thompson, an analyst with the Lexington Institute, a northern Virginia defense and national security research center.

The Air Mobility Command, which coordinates the global movements of aerial refueling tankers and Air Force cargo planes, flies everything from aging Boeing KC-135 tankers and newer C-17 airlifters to AWACS, JSTARS and the Flying Command Posts, Thompson said.

"If Boeing expects to continue doing that type of business, it's not a bad idea to have a facility there," he said.

Boeing also has bid on a $35 billion contract to build a new generation of aerial tankers for the Air Force. The Boeing plane would be based on a 767 airframe built at the company's plant in Everett, Wash., and converted for tanker use at its Wichita, Kan., facility. The contract eventually could be worth $100 billion. The European Aeronautic Defence and Space Co. - a European defense contractor that's the parent of Airbus, Boeing's chief competitor in the commercial airline market - has submitted a tanker bid based on an Airbus A330 airframe.

With $23.5 billion in contracts, Boeing was the nation's third largest defense contractor in 2008. It trailed only Lockheed Martin, with $35.7 billion, and Northrop Grumman, with $24.9 billion.

While Boeing's corporate headquarters is in Chicago and its commercial airplane division is based in Seattle, its defense work is centered in the St. Louis area, where 16,000 workers build F-15s, F-18s and C-17s. Boeing acquired much of McDonnell Douglas' defense operations when it took over that company in the late 1990s.

The MidAmerica Airport plant would be Boeing's first manufacturing facility in Illinois.

The company said the new plant would house assembly and subassembly work.

A spokesman for Boeing in northern Virginia, Dan Beck, said the company was well aware that Scott Air Force Base and the Air Mobility Command were nearby.

"We always like to be close and responsive to our customers," Beck said. "But that didn't drive this thing."

Beck said the decision to put the plant at MidAmerica was due to the proximity to Boeing's St. Louis defense plants and the fact that there was a highly skilled work force in the area.

"What we are looking at are defense programs," he said. "The possibilities are unlimited."

Read more: http://www.miamiherald.com/2010/08/19/1783835/boeing-announces-new-plant-in.html#ixzz0x8XUA2Fe

[buglerbilly]

First Airbus Military A330MRTT for UK Royal Air Force Leaves Hangar

(Source: Airbus Military; issued August 27, 2010)

The first A330 MRTT Future Strategic Tanker Aircraft (FSTA) for the UK Royal Air Force has completed the indoor trials, such as systems trials, required prior to First Flight and has been rolled out of its hangar at Airbus Military’s Getafe, Madrid facility to continue with the outdoor trials, such as fuel trials and others.

Once all trials are successfully completed, the aircraft will be handed over to the Flight Test Team for First Flight which is due in the first part of September.

The aircraft has been converted from a basic A330-200 airframe by Airbus Military.

Following the flight-test programme it will be delivered late next year to the AirTanker consortium responsible for operating the aircraft on behalf of the UK Royal Air Force.

-ends-

[buglerbilly]

EXCLUSIVE - U.S. tanker award date becomes more uncertain

By Jim Wolf

WASHINGTON | Sat Sep 4, 2010 4:41am IST

WASHINGTON (Reuters) - The target date for the much-delayed award of a possible $50 billion U.S. Air Force refueling-plane deal just got murkier, and potentially more politicized.

No longer is mid-November necessarily the moment of truth in the rematch pitting Chicago-based Boeing Co(BA.N) against Airbus parent EADS(EAD.PA), its European rival.

"The decision will be in the fall," Lt. Col. Jack Miller, an Air Force spokesman, told Reuters Friday. "What I gave you is the latest, and corrects and clarifies any previous statements."

"Fall" means potentially as late as Dec. 20, according to the calendar.

Lt. Gen. Mark Shackelford, the Air Force's top uniformed acquisition officer, had said on June 18 that the contract was expected to be awarded in a "mid-November time frame." The Defense Department has told the bidders to be ready to start work by Nov. 12.

Miller said the winner could be announced before or after Nov. 12, a date he described as a planning construct for rival bids submitted by the July 9 deadline. At stake is an order for an initial 179 aircraft that could be worth $25 billion to $50 billion.

This round marks the third time the Air Force has sought to start replacing its Boeing-built KC-135 tanker aircraft that on average are about 50 years old. The purchase has long been listed as the Air Force's top acquisition priority.

An initial effort, a lease-purchase with Boeing, collapsed in 2004 amid a scandal that sent the Air Force's former second-ranking arms buyer and Boeing's ex-chief financial officer to prison for conflict-of-interest violations.

The Pentagon in 2008 awarded a 179-plane deal to a team made up of Northrop Grumman Corp and EADS, only to have it overturned on appeal from Boeing. The U.S. Government Accountability Office found the Air Force had made enough errors in judging the contest to have changed its outcome.

ELECTIONS

The results of the Nov. 2 U.S. mid-term elections could play into the competition's latest round, analysts have said. Southern Republicans have rallied to the Airbus A330 derivative that EADS has offered. Its final assembly would take place at a plant to be built in Mobile, Alabama, if EADS prevails.

Boeing's modified 767 on offer would be primarily built in Democratic districts in Washington state, and finished in Kansas. It has wide backing from the Democrats who control Congress plus the Kansas delegation.

Republican gains in the voting could change control of the congressional committees with the power of the purse over the Defense Department and alter the fortunes of the rival bidders.

Richard Aboulafia of the Fairfax, Virginia-based Teal Group aerospace consultancy, said the Air Force appeared to be seeking more "leeway" to look at the poll results before announcing the winner.

"Two things I would not bet against," he said. "The first is a further delay. The other is politicization. These are the two givens that we've lived with throughout this program."

Guy Hicks, a spokesman for EADS' North American arm, said his company "remained focused on mid-November for an expected award."

William Barksdale, a Boeing spokesman, said, "We have to be patient. This is their process and we look forward to answering any more questions they may have about our bid."

Sen. Patty Murray, a Washington Democrat who is an outspoken Boeing advocate, reacted angrily in June when she thought the Pentagon was delaying the award.

"The truth is that the Pentagon's plans to bend over backwards for Airbus will mean another delay at the expense of our men and women in uniform, American workers, and our economy," she said in a June 21 statement sparked by Shackelford's comments on a mid-November time frame. She could not be reached for further comment Friday.

Bidders may increase or decrease their proposed prices in response to government requests for final offers under U.S. federal acquisition regulations.

(Reporting by Jim Wolf, editing by Matthew Lewis)

[buglerbilly]

Israel Aerospace Industries Completed Series of Successful Flight Tests of Colombian Air Force's Boeing 767 Air Refueling Aircraft

Sep 5, 2010

Itzhak Nissan, President and CEO of Israel Aerospace Industries: "We are proud to be working with such a distinguished customer as the Colombian Air Force, and are pleased to have been chosen to take on such critical projects as supplying and upgrading Kfir aircraft and supplying aerial refueling aircraft. These projects reflect IAI's strength and its integrative capabilities."


The Colombian Air Force's Kfir C10 fighter aircraft being refueled by the B767 air refueling tanker

A series of successful flight tests aimed at opening the flight envelope have been completed for the pre-owned B767-200ER (Extended Range) aircraft, converted by Bedek Aviation Group of Israel Aerospace Industries (IAI) to a Multi Mission Tanker Transport (MMTT) configuration for the Colombian government and the end user, the Colombian Air Force.

The converted aircraft is equipped with two Wing Air Refueling Pods (WARPs) of the ARP3 model, developed and manufactured by IAI.

During the first 3.5-hour flight test, the full envelope, including altitude, speed, and Mach number, was opened without any flutter or buffet problems. Additional in-flight refueling tests of a C10 Kfir fighter jet, also produced by IAI, were successfully completed.

The MMTT pilot reported an extremely smooth flight with no technical events.

The air refueling system functioned very well, and the first hook-ups and fuel transfers were the most exciting moments of the flight. IAI's test pilot team that flew the aircraft reported that the systems performed flawlessly. The pilot of the Kfir (the aircraft being refueled) appreciated the easy, stable hook-up in each of the two WARPs.

As previously reported, IAI was awarded a multi-year contract in 2007 worth more than $150 million to upgrade the Colombian Air Force's Kfir aircraft. In June of 2009, the first Kfir aircraft were redelivered to the Colombians, and have been in operational activity ever since.

The tanker conversion project, which lasted more than two years, was completed by IAI's technicians, flight test pilots, and engineers, all of whom contributed to the development and integration of the air refueling system into the B767. Their dedication and hard work culminated in the minutes during which the tanker and the Kfir met in the air and performed the hook-up, an "exciting and proud" moment for those involved in the project.

IAI's chief test pilot Ronen Shapira, who flew behind the B767-200ER in a G250 business jet aircraft, also confirmed the smooth flight: "The flights were successful, and the aircraft performed extremely well with the air refueling pods. The aircraft performance and overall stability of the aircraft and the drogues all displayed impressive results."

Eli Hattem, General Manager of IAI's Bedek Aviation Group, commented: "These successful flight tests are an important milestone in this conversion. We are pleased to report that everything is progressing smoothly and look forward to continuing to strengthen our ties with the Colombian government and its Air Force."

In the coming days, the B767-200MMTT will perform additional flights before its redelivery to the Colombian Air Force.

[buglerbilly]

U.S. Aerospace Files Second KC-X Protest

Sep 7, 2010

By Amy Butler

U.S. Aerospace, the bidder kicked out of the U.S. Air Force’s KC-135 replacement competition for allegedly submitting its proposal late, has filed a second protest of the service’s decision not to let the company compete for the $35 billion program.

The U.S. Government Accountability Office (GAO), which conducts bid-protest audits, lists the protest as having been filed Sept. 1 and due for a decision by Nov. 5.

U.S. Aerospace is teamed with Ukrainian state-owned Antonov to propose a tanker based on the An-70. However, Air Force officials said the proposal arrived roughly 5 min. past the 2 p.m. July 9 deadline and was ineligible for consideration. The source selection, meanwhile, continues between an EADS A330-200-based tanker and Boeing’s offer, based on the 767. Lt. Gen. Mark Shackelford says a winner will be announced in the fall.

U.S. Aerospace’s second protest claims that the Air Force lacks sufficient evidence to prove that the proposal was actually submitted late, according to industry officials. The service apparently lacks videotape evidence from the security gate at Wright-Patterson AFB, Ohio, showing that the U.S. Aerospace messenger entered July 9 to deliver the documents. Additionally, security logs that would document the entry were apparently not printed, and electronic copies have not been produced or were on a computer hard drive that has crashed, an industry official says.

The Air Force’s claim not to have video evidence of the messenger at the guard gate lacks credibility, as the facility is fenced and monitored, industry officials say.

The company also raises questions about whether there was actually a dispute over the receipt of the proposal among officials in the KC-X program office. Company officials claim that it is possible a uniformed officer falsified or erroneously entered the time on the delivery receipt, industry officials say. Another Air Force official allegedly stated that she was unaware of the U.S. Aerospace messenger having arrived on base prior to the 2 p.m. deadline; company officials, however, say that e-mails and voice mails did inform this official of the messenger’s arrival time.

The fundamental legal question will likely be how the government defines receipt of a proposal and whether the Air Force followed its own rules on the matter. According to the request for proposals issued in February, the solicitations were to be addressed to the 836 Aeronautical Systems Group on 1755 Eleventh St. in Building 570. This is an office at Wright-Patterson, behind the security gate and fences. U.S. Aerospace’s attorneys have asked GAO for a hearing to cross-examine witnesses. They also are requesting documents and other evidence regarding the guard gate’s entry logs and the allegedly crashed hard drive.

U.S. Aerospace filed its first protest Aug. 2, refuting the decision to boot the company from the competition. Though protests typically are allowed up to 100 days to be resolved, GAO granted an Air Force request for an expedited review that will conclude in 65 days, or by Oct. 6. This new protest was filed in response to data gleaned by U.S. Aerospace in the Air Force’s response to the original protest, according to industry officials.

[buglerbilly]

Ares

A Defense Technology Blog

Thrown-out KC-X Bidder Launches Second Protest

Posted by Amy Butler at 9/7/2010 12:22 PM CDT

U.S. Aerospace's list of complaints about the U.S. Air Force's conduct in receiving its bid -- allegedly late -- for the KC-X competition is getting longer.

The company filed its second protest last week, claiming the Air Force intentionally misplaced or lost evidence that would prove its assertion that the U.S. Aerospace bid was late to Wright-Patterson AFB. The deadline for entries was July 9 at 2 p.m. And Air Force officials kicked U.S. Aerospace out for filing its bid 5 minutes late.

At issue in the protest is whether the company actually was late in delivering its bid and whether the Air Force accurately described the process for submitting bids. Also, the Air Force's record-keeping of the submission will come into question; the company claims the service lacks entry logs for the gate at Wright-Patterson AFB and also had a computer hard drive containing entry footage from security cameras crash.

Air Force officials have consistently declined to comment on the issues at play in the protest.

The second protest will be ruled upon by the Government Accountability Office by Nov. 5. This protest was filed after the Air Force provided its response to the first protest from U.S. Aerospace. The first protest was lodged Aug. 2, and GAO expects to rule on it by Oct. 6.

Meanwhile, Air Force officials are proceeding with the source selection for KC-X based on two proposals: Boeing's based on the 767 and EADS's based on the A330-200.

Lt. Gen. Mark Shackelford, the military deputy to the Air Force acquisition secretary, says that the Small Diameter Bomb II competition was run cleanly. The lack of a protest from losing bidders Boeing/Lockheed Martin was a "woo hoo victory" for the service, which has lately been beleaguered by some high profile procurement missteps. Raytheon snagged that $450 million contract to build a 250-lb. glide bomb capable of destroying moving targets through weather.

Shackelford says that an independent team reviewed the SDB II process five times as it progressed, and this process will be duplicated for the KC-X procurement.

[buglerbilly]

Boeing leaves open tanker price tweak

By Jim Wolf and Tim Hepher

WASHINGTON | Tue Sep 7, 2010 8:10pm BST


Dennis Muilenburg, President and CEO of Boeing Defense, Space & Safety, speaks during the Reuters Aerospace and Defense Summit 2010 in Washington September 7, 2010.
Credit: Reuters/Molly Riley

Obviously my idea of Sealed Bids process differs from Boeing's..........."I've given you a Bid BUT I'll drop it whatever percentage IF you give me the contract.............you know you can trust us!" :shrug

I must have been wasting my time in Procurement for the last 40+ years.........:stfu

WASHINGTON (Reuters) - Boeing Co (BA.N) left open the possibility of trimming its current bid to build 179 new U.S. refueling aircraft in its continuing drive to deny the deal to Airbus parent EADS (EAD.PA), its European rival.

The U.S. Air Force is weighing competing bids on the contract, valued at $25 billion to $50 billion, that were due on July 9 and is asking the bidders follow-up questions.

The rematch marks the third time the Air Force has sought to start replacing its Boeing-built KC-135 tanker aircraft that on average are about 50 years old. The purchase has long been listed as the Air Force's top acquisition priority.

The government typically seeks a final proposal revision and if asked, "we'll respond to that," Dennis Muilenburg, the head of Boeing's weapons-building arm, told the Reuters Aerospace and Defense summit in Washington on Tuesday.

"Our intent is to continue to offer a winning offer," he said when pressed on whether the company might lower its bid for competitive reasons. "Beyond that I can't comment until we get specific requests from the customer."

He said the tanker is a "national priority, and Boeing is prepared to respond with that kind of priority."

Guy Hicks, a spokesman for EADS's North American arm, said in response that an "interactive process with the customer" has begun.

"We have submitted a compelling proposal that meets our business case," he said in an email. "We have the most capable tanker available -- period."

The Air Force says it will award a contract this fall, which could mean as late as December 20.

Muilenburg said Chicago-based Boeing must balance its responsibilities to all stakeholders as it weighs any such bid revision. "We're going to make decisions here that are financially responsible," he said.

The initial Air Force tanker-acquisition effort, a would-be lease-purchase with Boeing, collapsed in 2004 amid a scandal that sent the Air Force's former second-ranking arms buyer and Boeing's ex-chief financial officer to prison for conflict-of-interest violations.

The Pentagon in 2008 awarded a 179-plane deal to a team made up of Northrop Grumman Corp (NOC.N) and EADS, only to have it overturned on appeal from Boeing. The U.S. Government Accountability Office found the Air Force had made enough errors in judging the contest to have changed its outcome.

Boeing's bid in the latest round of competition was cheaper than its previous, failed bid against Airbus for the 179-plane deal, Jean Chamberlin, Boeing's general manager for the bid, told Reuters in a July 9 telephone interview. Boeing remained concerned about a "heavily subsidized competitor," she said, alluding to a U.S.-European subsidies dispute that adds a diplomatically sensitive geo-economic dimension to the tanker mix.

Muilenburg declined to describe the 767 variant Boeing is offering this time but said it is an existing airframe with "in-line modifications," such as an all-new digital cockpit of the type used in the 787 Dreamliner.

Boeing's catalog has three different sizes of the passenger version of the 767, built to carry 181 to 245 people between 5,600 and 6,600 statute miles.

In an effort to deny information to its competitor, Boeing has not said publicly which airframe it would use, but Muilenburg's comments appeared to rule out a hybrid version that EADS contends would be risky to produce.

(Reporting by Jim Wolf and Tim Hepher, editing by Gerald E. McCormick)