KC-45 fallout continues
Filed under: Boeing, Contract Awards, Department of Defense, EADS, GAO, Military Aviation, Northrop Grumman Corp., Proposal, Protest, U.S. Air Force, commercial aviation, logistics, production program
With the decision to not go ahead with the KC-45 recompete and the cancellation of the planned source selection, the Pentagon has decided that due to the decision to cancel the original contract Northrop Grumman, and EADS, will receive some termination fee. This will pay the company for any work that the did while the contract was active prior to the protest and GAO recommendation to recompete the proposal. Termination fees are common for when the Government cancels the contract for administrative reasons. If ti is canceled due to non-performance then it gets a little more difficult. Due to the high visibility of this decision, I am sure the Congress will take a look at any money payed to Northrop Grumman.
See the Los Angeles Times for more on this.
Australia cuts bait
Filed under: Australia, Boeing, Contract Awards, McDonnell Douglas, Military Aviation, production program
The Australian government decided after all to go ahead with the purchase of the F/A-18 to gap fill until the JSF is available. An article is here. The new more liberal government had discussed canceling the contract to save money. Now they claim they have been able to reduce the total cost, so it is worthwhile. See a previous article here. Read more
Not only the US has problems with C3 programs
This article in Forbes.com describes the Danish cancellation of a contract with SAAB. It was for a C3 system called DACCIS. Not only did Denmark cancel the contract they are suing the company for 143 M Danish Kronor. Read more
New Australian government realizes there is a bill associated with cancelling F/A-18 contract
Filed under: Australia, Lockheed Martin, Military Aviation, Restructuring, production program
The new liberal government in Australia has talked about canceling the contract to purchase 24 F/A-18 aircraft to be used as a gap fill until the F-35 JSF is available. See ABC News here for details. Unfortunately there is a termination fee of around $400 M (Australian) associated with cancellation. Read more
Labor government cuts defence budget, English contractors feel pain
This analysis in The Guardian says that BAE and the VT Group will lose billions in orders from the British government if planned cuts to the defence budget go through. Because some of the contracts for hardware have cancellation clauses the government may be force to buy the systems and then sell them to other nations. This is all part of an attempt to reduce public spending.
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