Now Boeing can lose both KC-X and CSAR-X while the Dems lose the elections in November!

Quote: Boeing to Protest Air Force Tanker Decision By AUGUST COLE and J. LYNN LUNSFORD March 10, 2008 6:37 p.m. Boeing Co. said it plans to protest the U.S. Air Force's decision to award a $40 billion contract for aerial refueling tankers to a team comprised of Northrop Grumman Corp. and the parent company of rival Airbus. Boeing said it will file a formal protest on Tuesday asking the Government Accountability Office to review the Air Force's decision to give the contract to Northrop and European Aeronautic Defence & Space Co. "Our team has taken a very close look at the tanker decision and found serious flaws in the process that we believe warrant appeal," said Boeing Chairman and Chief Executive Jim McNerney in a statement. "This is an extraordinary step rarely taken by our company and one we take very seriously."

http://online.wsj.com/article/SB1205...1897125441.html?mod=googlenews_wsj

[Edited 2008-03-10 15:44:28]

So far, Albaugh, head of Boeing IDS, has been the face of Boeing on the KC-X. I find it interesting that Jim McNerney is making the public announcement about the appeal. If anyone doubts that this contract loss (as well as the other issues with BCA) isn't putting pressure on him to step down, this should remove those doubts. It's almost as if he's hanging his hat on this event to prove he still has what it takes to lead.

Well I guess that doesn't come as too much of a surprise. I understand the GAO has up to 100 days to uphold or throw out this appeal. So, maybe another three months of tanker threads!   

Well, they say there's two sides to every story:

http://money.cnn.com/news/newsfeeds/...cles/newstex/AFX-0013-23662706.htm

Quote: The company said the Air Force fully explained why the KC-45A tanker was 'clearly the superior tanker' for the contract. In particular, Northrop said the Air Force attributed its choice to the KC-45A being 'more advantageous' to the government in areas such as mission capability, past performance and cost.

http://www.marketwatch.com/news/stor...F36-F7B5-4A0E-AECB-EBD0A40D99C2%7D

http://www.tradingmarkets.com/.site/news/BREAKING%20NEWS/1185108/

Quote: Over the course of the selection process, Northrop Grumman and its competitor Boeing Co. repeatedly said the Air Force acquisition process for the KC-X program was fair, open and fully transparent.

I suspect that this will still be disputed when the last NWA DC9 goes to the desert  .

Just how long can they keep the KC135 flying.

With the case of CSAR-X there were a handful of tangible examples where the GAO found reason to uphold the losing bidders (in this case - two sperate companies) protests but in KC-X I have yet to hear a single reason as to why Boeing feels the GAO will even give them the light od day?! So now not only did Boeing let the USAF down in submitting an inferior platform now they are directly going against the USAF's specific wishes and going to protest the bid just because they can (more so than because they honestly believe the GAO will overturn the award and reopen it - but maybe their just looking for payback for their CSAR-X bid protest?

Well, once the GAO comes back and says they find no reason to side with Boeing's protest, than the USAF can award CSAR-X to LM soon thereafter and Boeing can be left out on the cold on both competitions - smooth move Boeing.

This is like sueing for your high school diploma when the reason you were never otherwise awarded it was because you didn't meet the criteria!

Sue Payton and her team took 6-9 months specifically trying to make sure that their decision would yield no space for sustainment of a protest and do you think Boeing will have a legitimate case? I don't think so, but we'll hear what it is that they are protesting by the end of tuesday.

Nobody knows the shortcomings of Boeing's KC-X bid better than the USAF and they were doing everything they possible could do to select Boeing in CSAR-X but I suspect that will now cease. Boeing couldn't offer a superior bid in either competition and now the USAF can finally tell Boeing how they really feel.

Boeing only loses with this protest: not only points for submitting an inferior bid (both CSAR-X and KC-X in my opinion) but also for whining about losing just for the sake of whining.

I eagerly look forward to reading the GAO's ruling on this protest as it will only further discredit Boeing's credibility and expose the short comings of thier KX-767AT bid. Maybe Boeing can sue all of those airlines that choose the A-330 over their B-767, too?

[Edited 2008-03-10 16:24:10]

Let it go Boeing. Its over, spend the money on other programs.

The key issues is the fact that Air Force did not say anything about size of the tanker in their original RFP. After NGC threatened to drop out of the competition unless Air Force accounts for the larger size of the A330, this criteria was added.

Boeing has a heartburn with this last change, because it would have offered 777 if the size was part of the evaluation criteria.

One could argue that accounting for size AFTER the bids were submitted, was done in order to favor the NGC team. This is really not that complicated or controversial.

If the Boeing team was not able to well identify the Air Force needs it's a commercial mistake nothing more. The Airbus team did a good job showing a larger aircraft was better suited for the Air force operations so they deserve the contract.

In the commercial aviation business you always have competition between smaller or bigger aircraft. The airlines never specify the exact aircraft capacity they want, they ask the manufacturers to make propositions.

I wont argue that NGC must have done an outstanding job showing the benefits of the bigger aircraft, however this would not have mattered unless the Air Force changed the RFP to account for size difference i.e. Bigger is better.

Boeing floated the idea of the 777 based tanker, however Air Force said that they were not interested. Then they turn around, change the criteria, and award the bid to the bigger platform.

Bottom line, Air Force changed the criteria to benefit the NGC, after it turned Boeing away from proposing a larger platform. It doesn't sound very fair to me, and unlike commercial world, Government contracts can be appealed much more effectively.

Quoting Stratofortress (Reply 6): Boeing has a heartburn with this last change, because it would have offered 777 if the size was part of the evaluation criteria.

I doubt it could have. It could not have reached the 7000ft runway requirement at MTOW for one and as it's list price is way higher than the B767, I cannot see how it would have fitted into the cost requiremets. In addition, the 767 is commercially dead with just 46 orders (the bulk being freighters) in years 06 and 07 and none so far in 08, while the 777 has taken 236 in the same time frame (Source: boeing.com) with a backlog of production orders. I wonder how Boeing could have built the 777 tanker in a reasonable time frame.

Another view.....

http://www.flightglobal.com/articles...er-award-to-northrop-and-eads.html

Quoting Stratofortress (Reply 8): I wont argue that NGC must have done an outstanding job showing the benefits of the bigger aircraft, however this would not have mattered unless the Air Force changed the RFP to account for size difference i.e. Bigger is better. Boeing floated the idea of the 777 based tanker, however Air Force said that they were not interested. Then they turn around, change the criteria, and award the bid to the bigger platform.

Not really. You're simplifying things to the point of implying that Boeing should have offered a KC-747 and Airbus a KC-380. The Air Force has not said "bigger is better", it has concluded that, everything else equal, greater capabilities are preferable over lesser capabilities. But everything else is not equal: the KC-45 also scored better than the KC-767 on the other criteria.

Nor would everything else be equal in the case of a KC-777. It would be bigger than the KC-45, but what about cost? If Boeing can't beat the KC-45 on cost with a 767-based offer, it would certainly not be able to do so with a 777-based offer.

It tells you something that the only sales arguments Boeing seems to be able to come up with are that the KC-767 is smaller and that it is "more American".

Quoting Stratofortress (Reply 8): I wont argue that NGC must have done an outstanding job showing the benefits of the bigger aircraft, however this would not have mattered unless the Air Force changed the RFP to account for size difference i.e. Bigger is better.

Boeing had the same RFP that NG had. I know NG ran the KC-767AT through its analysis to see where it came up against the RFP metrics, and I am sure unless someone in Boeing was so arrogant that they thought they had it in the bag, they would have done the same for the KC-30. At the same time I am sure they would have ran the KC-777 through the analysis as well.

I think Boeing knew very well where it stood.

Quoting Stratofortress (Reply 8): Boeing floated the idea of the 777 based tanker, however Air Force said that they were not interested. Then they turn around, change the criteria, and award the bid to the bigger platform.

The decision not to field the 777 was Boeing's doing, not the USAF.

http://www.flightglobal.com/articles...che-process-to-replace-ageing.html
http://www.flightglobal.com/articles...nker-rfp-reveals-kc-777-offer.html

Absolutely reasonable for Boeing to contest this. With Billions at stake, it would be insane not to request a review.

Will EADS ever supply this plane.........?

Anyone read the Boeing analysis?

http://blog.seattlepi.nwsource.com/aerospace/archives/133904.asp

Sorry if it's been posted already - scroll down a bit.

This stood out: "Indeed, the Air Force evaluated Boeing as having significantly more strengths (discriminators) than the competitor" under "Mission Capability".

[Edited 2008-03-10 18:43:10]

Quoting Khobar (Reply 14): This stood out: "Indeed, the Air Force evaluated Boeing as having significantly more strengths (discriminators) than the competitor" under "Mission Capability".

I find the entire argument to be quite fascinating, not just the Mission Capability section. If true, this smells just as bad as the original tanker RFP back in 2003 where people were griping about Boeing being given favorable treatment.

I also found this from the Northrop/EADS perspective to be interesting:

Quote: · Using more recent data from our suppliers and applying the Labor Department's formula for projecting aerospace jobs at the state and regional level, the KC-45A will employ approximately 48,000 direct and indirect jobs nationwide.

So does that mean NG/EADS will take back their mocking of a few weeks ago of Boeing's employment numbers? Or do we assume their numbers now include the janitors and building pest-control guys?  

[Edited 2008-03-10 19:11:41]

'the competition should have been assessed greater risk for its complex and unproven multi-country build approach.'

Found this comment quite amusing from the Boeing PR.

5000+ aircraft deliveries and an adoption of 'complex multi-country' build for it's 787 seems to have passed them by  

Quoting TristarAtLCA (Reply 16): 'the competition should have been assessed greater risk for its complex and unproven multi-country build approach.' Found this comment quite amusing from the Boeing PR.

You mean the same process they used to deliver the Lakota EARLY to the US   

Maybe the process Boeing is using to the KC-767 is better, it is only costing the 82,000 a day in late fees, and another recent military applications of commercial airframes like wedgetail, what was that a 500 million dollar late fee so far on that ?

Quote: Boeing also disputes the USAF's assessment of the Northrop/EADS team's past performance as satisfactory arguing that relevant Airbus programmes - Australia's KC-30B tanker and the A400M airlifter - "are struggling"..

And Boeing thinks the USAF will continue to go out of their way and stretch the parameters of other similar contests such as CSAR-X after they decide to oppose the USAF in this bid? That's odd, because suddenly the HH-47 no longer meets the CSAR-X KPP of being able to be transported on a C-5 and re-assembled for flight within 3 hours - sucks to be you!

Quoting RedFlyer (Reply 15): Quoting Khobar (Reply 14): This stood out: "Indeed, the Air Force evaluated Boeing as having significantly more strengths (discriminators) than the competitor" under "Mission Capability". I find the entire argument to be quite fascinating, not just the Mission Capability section. If true, this smells just as bad as the original tanker RFP back in 2003 where people were griping about Boeing being given favorable treatment. I also found this from the Northrop/EADS perspective to be interesting:

But read that again - that is Boeing's words in their own opinions - I believe the GAO will make Boeing look like fools all the more so than they already currently do after losing the award.

Quote: Additionally, Boeing argues an analytical model used by the US Air Force to assess the fleet effectiveness of the rival tankers was developed by Northrop, and changes to the model "before and after RFP release" allowed a larger aircraft to compete.

Now why wouldn't Boeing have disagreed with this earlier?

Quoting Stratofortress (Reply 6): Boeing has a heartburn with this last change, because it would have offered 777 if the size was part of the evaluation criteria.

Well if Boeing would have offered a KC-777 to replace a KC-135 than they all the more so would have lost!

A KC-777 would have been too large, too expensive, and too risky to compete becuase it would have been an entire paper airplane competing against a KC-30 aircraft that already had a flying example: even as much as the KC-767AT was a Frankentanker paper airplane, at least there was a KC-767 of some form flying around for Boeing to claim some sort of experience of building a tanker not built during the Cold War.

Sorry Boeing - the KC-767 was too small, the KC-777 was too big, but the KC-30 was just the right size!

Quoting Zeke (Reply 17): You mean the same process they used to deliver the Lakota EARLY to the US scratchchin

You mean the Lakota that requires millions of dollars in mods to make it flyable for the US??? LOL.

Quoting AirRyan (Reply 18): And Boeing thinks the USAF will continue to go out of their way and stretch the parameters of other similar contests such as CSAR-X after they decide to oppose the USAF in this bid? That's odd, because suddenly the HH-47 no longer meets the CSAR-X KPP of being able to be transported on a C-5 and re-assembled for flight within 3 hours - sucks to be you!

Why do people think that the USAF will have a "vendetta" against Boeing if they protest? The USAF really doesn't care which one they get, as long as it works. They fill out the "dream sheet" and hope Congress funds it. If Congress wants to fund the EADS/NG tanker, ok. But if Congress wants to fund the Boeing tanker, so be it. Congress can be more "vindictive" then the USAF could ever hope to be. Look at all the stuff Congress has forced upon the military, look at what they have cut. This is how this will play out. I bet there will actually be two contracts in the end. One hundred for EADS/NG and one hundred for Boeing. And both will be used, abused and neglected(but maybe not in that order). Not the smartest way but since when has Congress done anything smart?And just remember, the orignial jet tanker contract was to go to Douglas, but in the end the USAF chose the Boeing(or should I say Gen LeMay chose Boeing.)

Dan in Jupiter

Quoting Khobar (Reply 14): This stood out: "Indeed, the Air Force evaluated Boeing as having significantly more strengths (discriminators) than the competitor" under "Mission Capability".

Viewed through the same glasses that see big problems with the exising A330 tanker programs but don't even mention the disaster that's been the Italian and Japanese 767 tankers?

Quote: · Boeing's past performance was rated "Satisfactory" · Northrop Grumman/Airbus was also rated satisfactory, despite having no relevant tanker experience and having never delivered a tanker with a refueling boom · Press reports indicate that some of the most relevant programs for Airbus (the KC-30 for Australia and the A-400M) are both significantly over cost and behind schedule Therefore, it follows that Boeing 1) had satisfactory past performance, and 2) relevant Airbus programs like the Australian KC-30 tanker and the A-400M are struggling.

This is the most pathetic piece of spin I've seen in quite some time.

Quoting Bennett123 (Reply 3): Just how long can they keep the KC135 flying.

Just as long as the B52's.  

A5XX

Quoting Khobar (Reply 19): You mean the Lakota that requires millions of dollars in mods to make it flyable for the US??? LOL.

Since when ?

Start cynical rant:

Why do I have this feeling that this tanker deal has been concluded a long time ago? Maybe I don't have as much faith in things as you do, but I suspect that the GAO will order to reopen the competition after Boeing will win. This whole thing is just a set up. Pick Northrop-Grumman/EADS first just to show the world that other planes could be selected, than after protest pick Boeing because in the end it's all about politics.

With military contracts, there's no such thing as a level playing field. Never. There's just to much power play involved making sure that, in the end, the war fighter is just subject to the grills of the politicians. Never mind about the men and women putting their a$$ on the line. They need the best stuff that is out there that money can buy. They don't need equipment that is best for their politicians.

Ah well, it was nice for Northrop-Grumman/EADS while it last...

End cynical rant: 

Cheers!   

Quoting Sprout5199 (Reply 20): They fill out the "dream sheet" and hope Congress funds it. If Congress wants to fund the EADS/NG tanker, ok.

This is an interesting point, because frankly, both planes met the RFP, and had different strengths, but the Air Force would not be getting a bad plane either way. And again, the USAF thought only a couple years ago that the 767 was the right choice and would work for them over a 20-40 year life, so that can't have changed abruptly.

Arguments from all sides are hollow. The USAF is putting a pretty face on the decision but some of their assertions are suspect. Boeing is of course going to claim they were wronged and their older plane is better, and EADS/NG is going to claim that their plane is just better, no matter how much bigger it may be, and no matter if it really adds to refueling time due to fewer tankers in the sky or takes up too much space on the ramp.

Quoting BHMBAGLOCK (Reply 21): This is the most pathetic piece of spin I've seen in quite some time.

I have to agree. I really like the beginning of each of the summaries, 'Therefore it follows' . I love the way it sounds so factual.

But, with everything being said at the moment, this really sums it up for me:

'and we should not require our military personnel to learn to speak French to be able to operate our refueling tankers.'

Said Senator Sam Brownback (R-Kansas - Yes, we know about Boeing's plant there).

Words, in this instance, simply fail me to describe how stupid this man sounds.

http://www.murray.senate.gov/news.cfm?id=294136

Quoting Ikramerica (Reply 25): the USAF thought only a couple years ago that the 767 was the right choice and would work for them over a 20-40 year life, so that can't have changed abruptly.

A couple of years ago, there was no open evaluation, nor a RFP: the contract was just awarded to Boeing and we now know why, don't we? Corruption: 2 high ranking Boeing people were sent to jail and a USAF official committed suicide over it.

Quoting Ikramerica (Reply 25): Both planes met the RFP, and had different strengths, but the Air Force would not be getting a bad plane either way.

Actually, the KC767 had a hard time meeting the criteria of the RFP in full! Some of the basic criteria (like taking off from a 7000 ft runway) can only be met by seriously restricting the plane's load: the KC767 can't make it off a 7000 ft long runway at max take off weight, which is one of the reasons why the KC767 is officially rated second after the KC30 by the USAF.

Would the KC767 be a bad plane? Certainly not, but why would you settle for overall second best? At higher price? Remember the KC767 won on ZERO of the 5 criteria set forward by the USAF, including mission capability AND cost...

[Edited 2008-03-11 02:36:30]

Quoting BHMBAGLOCK (Reply 21): This is the most pathetic piece of spin I've seen in quite some time.

Exactly. I've not heard much on the A330 MRTT program causing any kind of controversy here, except for perhaps that we went with a European product rather than buying a US one. For the most part, the A330 MRTT has slipped by under the radar.

I don't know what Boeing is on about, but they certainly aren't reading from the mainstream media, or following mainstream public opinion. What the mainstream media IS focusing on is the expected ripping up of the F18 Super Hornet contract with Boeing.

My guess is that the best option here for Airbus is to pull out and give up, because sure as hell, it looks like a political stitch up and Boeing will get it through election grand-standing.

Quoting JakeOrion (Reply 5): Let it go Boeing. Its over, spend the money on other programs.

The one thing Boeing fears most ist an Airbus aircraft factory in the US. With Airbi made in the US by workers getting paid in USD, they loose one of their big advantages: The low USD.
Up to now Airbus sells it's planes in USD and has to pay most of their expenses (salaries etc.) in Euros and the exchange rate gets worse and worse. This makes the profit margins of Airbus smalller than those of Boeing.
The US military contract gives Airbus management the justification towards their European employees and union to set up a factory inside the US. Once this factory exists, with core staff ttrained taken from the military plant, they can easily expand it to manufacture other types for the civilian market in the USD regions.

BTW, with the 767 line operating currently a reduced output, Boeing, if they win the contract, will probably just rehire staff they laid off a while ago. Boeing is notorious for their hire and fire policies.

Jan

Quoting Cpd (Reply 28): My guess is that the best option here for Airbus is to pull out and give up, because sure as hell, it looks like a political stitch up and Boeing will get it through election grand-standing.

The last thing to do for EADS is to pull the plug themselves!

Just let this go to the end: either they will prevail (since their offer is technically the best) or they will see the contract rewarded to Boeing based on nationalistic politics and can then use this fact to their best interest.

Don't forget the USA is challenging Europe's launch aid to EADS, yet Europe/EADS is saying it is merely correcting for market distorting military contract which are automatically awarded to Boeing.

When this deal goes to the KC767 after all, the USA can forget about their WTO case and EADS is guaranteed of receiving launch aid for many decades to come! After all: if Boeing still wins this one, despite scoring ZERO points from the USAF, then it is best proof indeed that what EADS is saying about the USA automatically rewarding military contracts to American manufacturers is true indeed and Europe has every right to correct for such market distorting working methods...

[Edited 2008-03-11 03:55:56]

I find it amazing that in three days they were able to analyze a process that took many Air Force and Pentagone experts months to compile and judge on.

Also on the PR side, the A330 MRTT for Australia and UK are over cost and behind schedule. I am not aware of the RAAF's A/C being late, and looking at the latest comments from the Aussies, they seem pretty happy about how it goes.

The UK project was delayed also because of how the MoD would finance the whole thing.

And please remind me of how things are going for the Japanese and Italian tankers???

They can only blame themselves, for dirty arrangements 5 years ago, and for procrastinating things with an inferior product now.

Quoting JakeOrion (Reply 5): Let it go Boeing. Its over, spend the money on other programs.

It is not as if they do not have something else to do, and something that should be more likely to succeed!

IMHO, if Boeing has indeed found flaws in a process which proves it's product was unfairly penalised, then an appeal seems wholly justified. I am pretty sure I would if they where the circumstances

I do however wonder if they also spent the weekend sounding out Congressman, and discovered the level of support was not to their benefit when this deal eventually (ever?) reaches Congress, and a direct appeal was the action left open to them.

Just some thoughts.

Boeing should protest until they land a $35B contract in France or Germany. Translated, that means they'll be protesting this until hell freezes over.

Quoting Wingman (Reply 34): Boeing should protest until they land a $35B contract in France or Germany. Translated, that means they'll be protesting this until hell freezes over.

Why should they protest based on that? That's not the free-market way is it?
/Milan320

Quoting Slz396 (Reply 30): When this deal goes to the KC767 after all, the USA can forget about their WTO case and EADS is guaranteed of receiving launch aid for many decades to come! After all: if Boeing still wins this one, despite scoring ZERO points from the USAF, then it is best proof indeed that what EADS is saying about the USA automatically rewarding military contracts to American manufacturers is true indeed and Europe has every right to correct for such market distorting working methods...

Please. Airbus is going to ask for and receive it's launch aid regardless of which way the tanker bid goes. "It's allowed in the treaty, so we are within our rights to recieve it..."

The one possibility that I don't think people have allowed for is that a democratic president (if elected) will slash military spending. Don't be surprised if the KC45 is one of the projects that gets zero-funded in a new administration.

Quoting Knoxibus (Reply 31): The UK project was delayed also because of how the MoD would finance the whole thing.

It may be hard to find the news clouded in all of the other aerial tanker news, but I thougt I read a brief aritcle just this morning about how they have recently got the financing all in order and are wanting to lease something like 12 tankers?

Quoting TristarAtLCA (Reply 33): I do however wonder if they also spent the weekend sounding out Congressman, and discovered the level of support was not to their benefit when this deal eventually (ever?) reaches Congress, and a direct appeal was the action left open to them.

That's exaclty what I think happened - Pelosi is so incredibly partisan she is in great part the reason why Congress only has a 20% approval rating: IMPEACH Pelosi NOW!