Backers of Two Tanker Contracts Want To Stay Anonymous
Filed under: EADS, K-CX News, KC-X, KC-X Tanker News, Northrop Grumman Corp., backers, bad news, campaign manager, detriment, e mail, grumman, mail exchange, northrop grumman, tankers, wichita eagle, women in uniform
The investors backing a campaign asking the government to split its contract for aerial refueling tankers between Boeing and Northrop Grumman want to remain anonymous for now. The campaign is called Build Them Both. “We are funded by a group of investors who have asked to remain nameless at this time,” said the effort’s campaign manager, Carrie Giddens. The group is not union sponsored and does not have ties to either Northrop or Boeing, Giddens said in an e-mail exchange. However, “we have sought out funding from both companies, their suppliers and unions who would be impacted by building them both.” The requests went out in the past two weeks. On Monday, Giddens called Northrop’s decision to pull out of the bidding process “bad news for American workers, our men and women in uniform, and for the taxpayer.” With only one company seeking a contract, 50,000 jobs that would have been created won’t be, Giddens said in the statement. “Without an ongoing competition there is no way to control costs, to the detriment of our military and taxpayer.”
Wall Street Journal Says Trans Atlantic Defense Deal Falters
The Wall Street Journal has weighed on the KC-X Tanker bid process, in an article entitled “Trans Atlantic Defense Deal Falters.” The article notes:The decision by Northrop Grumman Corp. and its European partner this week to drop out of a $40 billion competition to build aerial-refueling tankers for the Air Force is the latest example of how trans-Atlantic defense ventures have faltered. Many observers view the size of the tanker deal, and the prominent role played by Northrop partner European Aeronautic Defence & Space Co., as the most significant instance of how trans-Atlantic partnerships can get tripped up. Noorthrop billboard in Alabama in 2008 advertised a future tanker plant, but the company quit the project. “There’s no doubt that this outcome will reinforce the long-held understanding in Europe that the U.S. defense market is highly protected,” said Alex Nicholl, a specialist on European defense companies at the London-based International Institute for Strategic Studies. “This is not the first time that the rules of a U.S. competition have been rewritten to suit the American competitor. No doubt it won’t be the last.”Read the entire article at theJournal.
Long Term Aircraft Plan Includes 109 KC-X Tankers
Filed under: Congress, KC-X, KC-X Tanker News, Syndicated Industry News, U.S. Navy
The Air Force, Navy and Marine Corps released to Congress their “Aircraft Investment Plan”. This lays out how many fixed wing aircraft they intend to buy and maintain through 2020. The U.S.A.F. intends to buy 109 tankers by that year at an estimated cost of over $30 billion.
The Air Force also plans to maintain a force of 223 C-17 and 91 C-5 heavy lift aircraft. The core of the services aircraft though will be the F-35 JSF with about 600 planned for purchase at the current schedule.
New Group Advocating For Split Tanker Buy
Filed under: Alabama, Boeing, Congress, EADS, KC-X, KC-X Tanker News, Northrop Grumman Corp., Syndicated Industry News, Washington
The Washington Post writes today about a new group buying advertisements to support the concept of buying KC-X tankers from both Boeing (BA) and Northrop Grumman (NOC). The group is called “Build Them Both” and its financiers have so far remained private. The idea of a split buy was floated last year but despite the ability to produce aircraft faster the related logistical costs are so high that the Air Force and DoD won’t consider it.
The article may be found here as the second part of the post.
Governors Support Boeing Tanker in DC Press Conference
Filed under: Boeing, Congress, KC-X, KC-X Tanker News, Syndicated Industry News
Seattle’s Channel 5 covered the Governor’s press conference on the KC-X Tanker contract, in Washington D.C, this afternoon. According to Channel 5:
At the National Press Club in Washington, D.C., Washington state Gov. Chris Gregoire announced the launch of a bi-partisan coalition of governors to push for Boeing-built refueling tankers. It’s called the U.S. Tanker 2010 Coalition, and other states represented include Oregon, Kansas, Connecticut, Maine, Utah, Illinois, Missouri and Iowa – all states with a stake in the outcome, mostly as suppliers of parts.
“Together, we are going to make it known we’re going to fight for this work,” Gregoire said Monday.
Read more at King5.com.
India Relooking New Tanker Aircraft
Filed under: Business Line, Companies, Contract Awards, Countries, EADS, Events, India, Military Aviation, Proposal, development program, logistics
India currently operates a version of the Ilyushin-76 transport aircraft as an aerial tanker. The Il-78 “Midas” has been in service with Russia and India for several years and is a rugged, fairly cheap solution. Recently the Indian government had proposed new tankers based on the Airbus A330 aircraft. The same tanker is being purchased by England and would be considered again by the U.S. Air Force for its KC-X competition.
Now it is reported that the Finance Ministry has raised some concerns over the cost of the A330 compared to the Il-78. Both aircraft were proposed for the contract and the Il-78 was the cheaper bid. The Ministry feels that the contract should be reconsidered on cost grounds and also due to the fact that India already operates the Il-78 making it easier to integrate the new tankers. It is assumed though that the A330 platform offers benefits in capability and technology level over the older Russian aircraft.
India has been planning on new investment in their Armed Forces utilizing the purchase of foriegn, Western equipment to quickly upgrade their technological level. At the same time new rules on offsets and foriegn investment means that their economy will gain through these deals. The most important contract that is out there is for a new fighter which is currently undergoing the early stages of competition. Several U.S. and European companies as well as MiG have submitted bids.
It might be that the Indian Government decides that the higher cost of the A330 is worth it if the capability purchased is significantly enhanced.
Coming to a Theater Near You…the Boeing KC-7A7
Filed under: Boeing, KC-X, KC-X Tanker News, Syndicated Industry News
We are very proud of our 80-year tanker heritage at Boeing. But it’s also very important to show you what the future of air refueling could be. While we have highly capable KC-767 tankers flying in operational squadrons in Japan today and in the future in Italy, it's time we provide a glimpse of our 'family of tankers' operating together.
That’s why we’re thrilled to show you our new video...
When global reach and mission success is critical, the combat-ready KC-7A7 is ready to deliver maximum capability at lowest cost...all on day one.
Enjoy!
Process Under Attack
Filed under: Boeing, KC-X, KC-X Tanker News, Syndicated Industry News
While our opponent and their supporters have begun attacking the U.S. Air Force and its KC-X Tanker draft Request for Proposal, we have chosen to work within the process and continue asking questions some of which are posted on the Federal Business Opportunities website.
In the past, this competition to replace America’s critical fleet of air refueling tankers has been fought very publicly. Our preference is to allow the process to play out rather than work the requirements through the media. We will talk about the KC-X tanker competition when we’re ready and when it’s appropriate.
Ultimately, the men and women who selflessly serve our nation deserve the very best. We believe that is an American designed and built, combat-ready tanker with max capability at lowest cost. That tanker is the Boeing KC-7A7.
DoD Early Estimates Two Tankers Have High Costs
Prior to the release of the latest RFP for the KC-X tanker program some in Congress and the media mooted using a split award for the aircraft. This would allow for faster fielding of tankers to expedite replacement of the older KC-135’s. It would also possibly reduce the chance of a protest by either Northrop or Boeing as well as spreading the contract around to different states. The biggest issue with the idea is that it would add cost to the program. Through the necessity of having two separate support tails the overall program would be more expensive. There would be two training tracks, sets of support equipment and parts pools alone. The aircraft also may not be complimentary. The DoD estimated back in April that the total additional cost would be over $14 billion. Obviously neither the Air Force or the U.S. Government has this kind of money available to support the idea. It would have to be payed for at the expense of other Air Force or DoD programs. It may be that cost estimates with more refinement are created that reduce this, but right now the plan is one company and one aircraft.Air National Guard To Have Role With KC-X
Since 9/11 the U.S. military has moved to integrate even more their National Guard and Reserve Forces. They have been called up at high rates and have received more and upgraded equipment. Currently the Air National Guard of various states like Alabama fly KC-135 tankers. If the full fleet of KC-X aircraft are built then some of the states will receive these new tankers. Recently it was announced that the Air National Guard will provide participation on the KC-X source selection. This is most likely to help make sure that any specific requirements of the Air Guard are considered and is not common with programs of this size.
Boeing Responds To KC-X Draft RFP Release
Filed under: Acquisitions, Boeing, Business Line, Companies, Congress, EADS, Events, Military Aviation, Northrop Grumman Corp., Proposal, Services, U.S. Air Force, logistics, production program
Yesterday after the Air Force put out the draft RFP for the new tanker program. The third try at this acquisition Boeing responded with the following statement:
“Our next step is to conduct a detailed review of the document. We want to understand how requirements will be defined and prioritized and how the proposals will be evaluated. That information will help us decide which plane to offer or whether to offer both planes. We appreciate that there will be frequent, open discussion with the U.S. Air Force as we go forward. Both the Air Force and the American taxpayer will benefit from the tanker options we can offer. Boeing has a KC-7A7 ‘family of tankers’ available to meet the warfighter’s requirements. Whether it’s the agile, flexible 767-based tanker or the large 777-based tanker, Boeing will deliver a combat-ready tanker with maximum capability at the lowest cost.”
More details on Boeing’s plans may be found at the KC-7A7 United States Tanker website.
WTO ruling might hurt EADS tanker bid
PARIS, Sept. 9 (UPI) -- The World Trade Organization's decision to uphold U.S. complaints that Airbus received improper subsidies might burden the Europeans' chances to win a multibillion-dollar U.S. Air Force contract for refueling tankers.
EADS Sells More A330 Tankers To Saudi Arabia
Filed under: Australia, Boeing, Business Line, Companies, Congress, Contract Additions, Countries, Department of Defense, EADS, England, Events, Japan, Military Aviation, Northrop Grumman Corp., Services, U.S. Air Force, UAE, United States, commercial aviation, development program, logistics, production program
EADS announced today that Saudi Arabia had doubled their order for aerial tankers by buying three more A330 MRT aircraft. This means that the Kingdom will now have six of the advanced tankers. They along with the U.K., Australia and the U.A.E. have ordered the aircraft. As part of the buy of the new aircraft Saudi Arabia has ordered logistic and parts support for the tankers although no contract value was announced.
The big contract for military refueling aircraft is the new tanker for the United States Air Force (USAF). EADS and Northorp Grumman had won the contract for the KC-X last year only to see it overturned on a Boeing protest. Now the new Obama Administration and the USAF will try again with a completely new RFP. That contract would be for over one hundred aircraft and would dwarf previous orders. There is still discussion of possibly splitting the contract between the two suppliers with a goal of maximizing the number of aircraft delivered in a short time. The USAF and Defense Department are against that as the two aircraft would require their own substantial support tail of parts, maintenance and training which would be quite expensive.
The A330 is a bigger aircraft then the 767 proposed by Boeing last time but requires larger airfields and more gas to fly a comparable mission. The bigger aircraft can carry more fuel for other aircraft so there has to be a balance struck there. It is definitely conceivable that the loser of the next contract will protest anyway so there may be further delays to the acquisition of the greatly needed capability.
Congressman Murtha Makes Inefficient Recommendation for KC-X
Filed under: Alabama, Boeing, Business Line, Companies, Congress, Contract Awards, Department of Defense, EADS, Events, Federal Budget Process, GAO, Military Aviation, Northrop Grumman Corp., Protest, Restructuring, Services, Suspensions, U.S. Air Force, Washington, commercial aviation, development program, logistics, production program
Congressman Murtha, the powerful Democratic head of the House Appropriations Subcommittee for defense, was visiting Mobile, AL and made a rather stupid recommendation for the KC-X program. The Seattle Post-Intelligencer reports that he said the Air Force should split the work between Boeing and the EADS-Northrop Grumman team. Unless the military is going to buy large numbers of a system — and 150 odd tankers does not count — the costs associated with having two training, support and parts systems are unjustifiable. The aircraft would also end up more expensive as there is less economy of scale available with small lot buys. Murtha is just trying to split the knot but the suggestion is not practical.
Navistar gets logistic vehicle contracts
Filed under: Contract Awards, Navistar, U.S. Army, logistics, production program
Navistar was awarded two contracts by the Army to provide tactical support vehicles. These include one contract for tankers to carry fuel, oil and water. The vehicles are for use in Iraq and Afghanistan. Navistar has won several contracts to provide these kind of vehicles. One would have to assume that over the past seven years the Army has used a lot of these vehicles beyond what the originally intended. They will require either replacement or recapitalization, where they are rebuilt and retrofitted to be like a new one.
See the press release at MarketWatch.com.
Gates gives up
Filed under: Boeing, Contract Awards, Department of Defense, EADS, Federal Budget Process, GAO, Military Aviation, Northrop Grumman Corp., Proposal, Protest, U.S. Air Force, commercial aviation, development program, logistics, production program
The Secretary of Defense today canceled the KC-45 re-proposal. He decided that there was not enough time to do this before the end of President Bush’s second term. The announcement was made via a press release this afternoon. Secretary Gates stated that ““It has now become clear that the solicitation and award process cannot be accomplished by January,” he said. “Thus, I believe that rather than hand the next administration an incomplete and possibly contested process, we should cleanly defer this procurement to the next team.”
This decision ends temporarily a seven year saga that started with Boeing being given a lease for 767 tankers, through a proper competition that was thrown out by the GAO, and what was expected to be a quick recompete starting this month.
See the actual release at DefenseLink.mil.
Italian KC-767 tanker slips
Filed under: Boeing, Contract Awards, Italy, Military Aviation, U.S. Air Force, logistics, production program
Boeing will face financial penalties from Italy as delivery of their KC-767 tankers have slipped 36 months. Originally planned for a 2005 delivery the first won’t be ready until late 2008. Issues with the pod holding the drogue refueling system and also meeting some of the Italian specific requirements that are set higher then the FAA’s have caused the delays. This will not help with the Boeing bid on the USAF new tanker.
See Bloomberg.com for more.
KC-45 Videos from Northrop Grumman
Filed under: Airbus, EADS, Northrop Grumman Corp., U.S. Air Force, Video
I found these interesting videos about the KC-45, on YouTube. The first is an advertisement for the tanker; the second focuses on the KC-45 assembly process. They’re both worth taking a look at:
Boeing’s role in defense aviation shrinks
Filed under: Boeing, Military Aviation, commercial aviation, development program
This good article in The Seattle Times summarizes how defense aviation is playing a less-and-less role in Boeing’s business. See the article here. It traces how from World War II on Boeing built large transports, tankers and bombers for the US Army Air Corps and Air Force. Now, with the loss of the KC-45 contract, they really are not doing any such business. They obviously rely primarily on their civil aircraft for the bulk of their earnings and profits. Boeing defense business is starting to be more and more in the area of engineering services and total program development and management. They were the Lead System Integrator (LSI) on what used to be called National Missile Defense (NMD) in the Nineties. They have also had similar roles in other major contracts.
UK goes the lease route for their tankers
Filed under: Boeing, Contract Awards, EADS, England, Northrop Grumman Corp., commercial aviation, logistics
In kind of a switch from the US the UK decided to lease their new tankers from EADS. It also looks like full Contractor Logistics Support (CLS) will be utilized. This means that the contractor will be paid to do all of the maintenance on the aircraft. This has become more common in the US as well as it minimizes the up front costs to the government as they do not have to stock parts or train mechanics. Read more
UK orders 14 tankers from EADS
Filed under: Boeing, Contract Awards, EADS, England, commercial aviation, logistics
As predicted EADS along with a group of English and French companies won a contract to build 14 tankers for the Royal Air Force. See a story here. The contract is worth $26 Billion. Boeing had been eliminated from the competition a few years earlier.
Newest Conspiracy Theory on Why Boeing Lost The KC-45 Tanker Contract
In an article in the Asia Times Online, Julian Delasantellis argues that Boeing lost the KC-45 tanker contract, because the Bush administration’s foreign policy requires the ability to bomb far-away countries at any time:
What if, stripped of all the flowery rhetoric you deliver once a year at the United Nations, the essence of your foreign policy is simply a never-ending search for new countries to bomb?
You need a way to get the benefits of land-based aircraft for power projection, without the drawbacks of needing to find friendly countries willing to host your local airfields.
In short, you need really good airborne refueling tankers – the coaling stations of the modern age.
Air Force awards LAIRCM contract to Boeing
Filed under: Boeing, Contract Awards, U.S. Air Force, production program
Boeing won a contract to buy and install Large Aircraft Infra-Red Countermeasures (LAIRCM) systems on US Air Force aircraft. These would go on tankers and transports and provide protection against heat-seeking missiles. While no aircraft has recently been attacked in Iraq or Afghanistan there remains the chance that it will be. Forbes.com article on this is here. The contract is worth $77 M.
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