Northrup Grumman/EADS win USAF tanker bid
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The pro-Boeing brigade are amusing, especially lawmakers and politicians who seem to have little regard for going very public with HALF a story.
There are two very clear facts to be considered...
1. The WTO Report is an interim report, yes Airbus were found guilty, however, Boeing are under investigation for exactly the same thing. Further analysis tells us that the commercial aircraft which were covered by this ruling do not include A330 MRTT aircraft. People in glass houses??
2. Under WTO rules (in particular Article 23), member states cannot take retaliatory action outside the WTO process. If the tanker RFP had language that would not allow NGC/EADS to bid due to this interim report, it in itself would be a violation of WTO. Again, these lawmakers are publicly calling for the USA to breach the WTO.. Smart.. real smart.
Personally I do not see any other outcome than a split buy. I'm not saying it's the right move, but I think it's what will happen.
As for the DC / VC 10 suggestion...
There are two very clear facts to be considered...
1. The WTO Report is an interim report, yes Airbus were found guilty, however, Boeing are under investigation for exactly the same thing. Further analysis tells us that the commercial aircraft which were covered by this ruling do not include A330 MRTT aircraft. People in glass houses??
2. Under WTO rules (in particular Article 23), member states cannot take retaliatory action outside the WTO process. If the tanker RFP had language that would not allow NGC/EADS to bid due to this interim report, it in itself would be a violation of WTO. Again, these lawmakers are publicly calling for the USA to breach the WTO.. Smart.. real smart.
Personally I do not see any other outcome than a split buy. I'm not saying it's the right move, but I think it's what will happen.
As for the DC / VC 10 suggestion...
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Quite a difference between the UAE's A330MRTT Etihad-class seating and the Rendition-class seating proposed for Boeing's ageing Frankentanker design.
The USAF sometimes has rendition-class passengers.
The USAF sometimes has rendition-class passengers.
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I think from that last comment, we may not see Modern Elmo around these here parts for sometime.
He will be enjoying the "Orange Jumpsuit" weight loss and spititual awakening health spa. He may even get a free tour of some sunnier parts of the world and all without the need for travel documentation. How quaint.
He will be enjoying the "Orange Jumpsuit" weight loss and spititual awakening health spa. He may even get a free tour of some sunnier parts of the world and all without the need for travel documentation. How quaint.
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No comment.
The Pentagon recently announced its third attempt to find a supplier willing to accept $35 billion in exchange for 179 airborne refueling tankers. If BusinessWeek's reporting proves prescient, that $35 billion will be divided in some way between the two bidders -- Boeing (BA) and EADS' Airbus subsidiary in partnership with Northrop Grumman (NOC).
Before getting into why the contact will likely end up being split, it's worth focusing on the regional politics involved. The Boeing work for the tanker would be done in Washington, Connecticut and Illinois. By contrast, the Airbus/Northrop Grumman tankers would be built in Alabama and South Carolina -- not to mention Europe. In short, the Democratic party wants Boeing to win, and the Republican party favors Airbus/Northrop.
But what would be in the best interest of the Pentagon? A case could be made for divvying up the order based on the fit between different Pentagon requirements and the capabilities of the bidders' different aircraft. Specifically, the Airbus KC-30s would work best for the Pentagon's longer-range assignments across Asia, and the smaller Boeing KC-767s would cost less to operate on shorter refueling jobs.
The Air Force specifications for the tanker put Boeing at a disadvantage. That's because these specs put a heavier emphasis on the tanker's ability to fly long distances and carry more fuel -- thus ruling out Boeing KC-767.
But that's not all. The Air Force wants its tankers to be able to operate on long, 15,000 foot runways at its newer military bases as well as shorter 6,000-foot runways on bases in India and the Philippines. As BusinessWeek points out, this would again put Boeing at a disadvantage because its other possible tanker, a version of its 777 commercial jet, might not meet that spec.
Boeing is playing from behind on two other fronts as well. The Air Force wants early, so-called pre-production, versions of the tanker within 18 months of the July 2010 contract award at a "not-to-exceed" price per tanker. But since Boeing does not know when it will be able to build its KC-777 or how much it will cost, it may not want to comply with the deadline or the fixed-price requirement.
Nevertheless, the Pentagon could wind up back at square one if it awards the contract to one supplier because a single-source deal will almost certainly result in the loser filing a complaint. And that would only further delay the delivery of these badly needed tankers. So to make sure that the third try at awarding that $35 billion is the last, look for the Pentagon to split the bid.
Before getting into why the contact will likely end up being split, it's worth focusing on the regional politics involved. The Boeing work for the tanker would be done in Washington, Connecticut and Illinois. By contrast, the Airbus/Northrop Grumman tankers would be built in Alabama and South Carolina -- not to mention Europe. In short, the Democratic party wants Boeing to win, and the Republican party favors Airbus/Northrop.
But what would be in the best interest of the Pentagon? A case could be made for divvying up the order based on the fit between different Pentagon requirements and the capabilities of the bidders' different aircraft. Specifically, the Airbus KC-30s would work best for the Pentagon's longer-range assignments across Asia, and the smaller Boeing KC-767s would cost less to operate on shorter refueling jobs.
The Air Force specifications for the tanker put Boeing at a disadvantage. That's because these specs put a heavier emphasis on the tanker's ability to fly long distances and carry more fuel -- thus ruling out Boeing KC-767.
But that's not all. The Air Force wants its tankers to be able to operate on long, 15,000 foot runways at its newer military bases as well as shorter 6,000-foot runways on bases in India and the Philippines. As BusinessWeek points out, this would again put Boeing at a disadvantage because its other possible tanker, a version of its 777 commercial jet, might not meet that spec.
Boeing is playing from behind on two other fronts as well. The Air Force wants early, so-called pre-production, versions of the tanker within 18 months of the July 2010 contract award at a "not-to-exceed" price per tanker. But since Boeing does not know when it will be able to build its KC-777 or how much it will cost, it may not want to comply with the deadline or the fixed-price requirement.
Nevertheless, the Pentagon could wind up back at square one if it awards the contract to one supplier because a single-source deal will almost certainly result in the loser filing a complaint. And that would only further delay the delivery of these badly needed tankers. So to make sure that the third try at awarding that $35 billion is the last, look for the Pentagon to split the bid.
Ecce Homo! Loquitur...
Thread Starter
Northrop Threatens To Pull Out of KC-X Race
Northrop Grumman has told Pentagon acquisition chief Ashton Carter it will not bid for a multibillion-dollar U.S. Air Force aerial tanker contract unless major changes are made to the rules governing the competition.
Pentagon officials fired back hours later, vowing to resist altering the rules to meet a competitor's wishes and saying they have run the new competition "right down the middle."
Northrop President and CEO Wes Bush, in a Dec. 1 letter to Carter, said if the Pentagon wants the company and its European partner, EADS, to compete, defense officials must make "meaningful changes" to the draft request for proposals (RfP) for the KC-X program. "Absent a responsive set of changes in the final RfP, Northrop Grumman has determined it cannot submit a bid for the KC-X program" Bush wrote in the letter.
A Northrop spokesman said Bush complained to Carter, the military's top weapons buyer, because Air Force tanker buyers failed to respond to Northrop's concerns that the draft RfP was stacked in favor of Northrop's rival, Boeing. "It is Northrop's expectation that DoD will modify" the RfP, said company spokesman Randy Belote. A final RfP was expected by Nov. 30, but has not yet been issued.
The Air Force is expected to award a contract to Boeing or Northrop next summer for 179 planes. The contract could be worth $35 billion.
In a Nov. 4 letter, Bush asked that Northrop's list of concerns - which already have been transmitted to the Pentagon - be addressed in a revamped draft RfP. The Air Force replied that the department has informed Northrop that it is sticking with the original draft.
Bush said the company is concerned that the evaluation criteria outlined in the draft RfP give a "clear preference" to a smaller plane with "limited multirole capability." The Northrop-EADS KC-330 is larger than Boeing's expected entrant, the KC-767. The former also offers more cargo- and passenger-hauling capacity. The Air Force's solicitation - written along with the Office of the Secretary of Defense (OSD) - also would place on Northrop, Bush told Carter, "contractual and financial burdens ... that we simply cannot accept."
"This second draft RfP is fundamentally different from what the Air Force said it wanted and needed 18 months ago," Belote said. "The requirement has not changed, but what the Air Force is asking for has changed fundamentally. How did that happen?"
In a statement issued several hours later, the Pentagon said it "regrets that Northrop Grumman and Airbus have taken themselves out of the tanker competition and hope they will return when the final RfP is issued." EADS is the parent company of Airbus.
The DoD statement reiterated defense officials administration-bridging desire for a true competition, but added the Pentagon and Air Force "cannot compel the two airplane makers to compete." DoD said both Northrop-EADS and Boeing have suggested RfP changes "that would favor their offering," but added the department "will not change the war fighter requirements for the tanker to give advantage to either competitor."
The statement repeats Obama administration officials' months-old claim that they have orchestrated this latest attempt at buying new tankers "right down the middle." DoD said a final RfP likely will be released in January.
Northrop-EADS was expected to again compete against Boeing to build new flying gas stations are slated to replace the military's aging KC-135 tankers.
The Bush administration in late February 2008 picked the Northrop-EADS plane over the favored Boeing aircraft, a contract award the latter quickly protested. The contract award was axed that June when the Government Accountability Office determined the Air Force-run competition was flawed. That followed an embarrassing failed attempt earlier this decade to lease KC-767s from Boeing.
Many defense experts, because of that scandal, have stressed the importance of two competitors squaring off for the massive contract. A sole-source contract award could be politically damaging to the military and the White House, experts said. Northrop appears ready to take advantage of this. In the Dec. 1 letter, Bush tells the DoD acquisition chief that Northrop brass "are aware of how important it is to the credibility of the ultimate KC-X tanker award that it be arrived at competitively."
The threat to pull out of the KC-X race will surely be seen by many in the global defense community as an attempt to force OSD and the Air Force into altering the rules and evaluation criteria spelled out in the draft RfP. Bush added that Northrop officials will soon begin notifying its 200 KC-330 supplier firms that the Northrop-EADS team will not compete for the U.S. Air Force contract.
Bush's letter leaves the door open for a Northrop-EADS bid: "It is my hope that the department will modify its approach to this procurement in a way that will enable us to offer our product for your consideration."
Northrop Grumman has told Pentagon acquisition chief Ashton Carter it will not bid for a multibillion-dollar U.S. Air Force aerial tanker contract unless major changes are made to the rules governing the competition.
Pentagon officials fired back hours later, vowing to resist altering the rules to meet a competitor's wishes and saying they have run the new competition "right down the middle."
Northrop President and CEO Wes Bush, in a Dec. 1 letter to Carter, said if the Pentagon wants the company and its European partner, EADS, to compete, defense officials must make "meaningful changes" to the draft request for proposals (RfP) for the KC-X program. "Absent a responsive set of changes in the final RfP, Northrop Grumman has determined it cannot submit a bid for the KC-X program" Bush wrote in the letter.
A Northrop spokesman said Bush complained to Carter, the military's top weapons buyer, because Air Force tanker buyers failed to respond to Northrop's concerns that the draft RfP was stacked in favor of Northrop's rival, Boeing. "It is Northrop's expectation that DoD will modify" the RfP, said company spokesman Randy Belote. A final RfP was expected by Nov. 30, but has not yet been issued.
The Air Force is expected to award a contract to Boeing or Northrop next summer for 179 planes. The contract could be worth $35 billion.
In a Nov. 4 letter, Bush asked that Northrop's list of concerns - which already have been transmitted to the Pentagon - be addressed in a revamped draft RfP. The Air Force replied that the department has informed Northrop that it is sticking with the original draft.
Bush said the company is concerned that the evaluation criteria outlined in the draft RfP give a "clear preference" to a smaller plane with "limited multirole capability." The Northrop-EADS KC-330 is larger than Boeing's expected entrant, the KC-767. The former also offers more cargo- and passenger-hauling capacity. The Air Force's solicitation - written along with the Office of the Secretary of Defense (OSD) - also would place on Northrop, Bush told Carter, "contractual and financial burdens ... that we simply cannot accept."
"This second draft RfP is fundamentally different from what the Air Force said it wanted and needed 18 months ago," Belote said. "The requirement has not changed, but what the Air Force is asking for has changed fundamentally. How did that happen?"
In a statement issued several hours later, the Pentagon said it "regrets that Northrop Grumman and Airbus have taken themselves out of the tanker competition and hope they will return when the final RfP is issued." EADS is the parent company of Airbus.
The DoD statement reiterated defense officials administration-bridging desire for a true competition, but added the Pentagon and Air Force "cannot compel the two airplane makers to compete." DoD said both Northrop-EADS and Boeing have suggested RfP changes "that would favor their offering," but added the department "will not change the war fighter requirements for the tanker to give advantage to either competitor."
The statement repeats Obama administration officials' months-old claim that they have orchestrated this latest attempt at buying new tankers "right down the middle." DoD said a final RfP likely will be released in January.
Northrop-EADS was expected to again compete against Boeing to build new flying gas stations are slated to replace the military's aging KC-135 tankers.
The Bush administration in late February 2008 picked the Northrop-EADS plane over the favored Boeing aircraft, a contract award the latter quickly protested. The contract award was axed that June when the Government Accountability Office determined the Air Force-run competition was flawed. That followed an embarrassing failed attempt earlier this decade to lease KC-767s from Boeing.
Many defense experts, because of that scandal, have stressed the importance of two competitors squaring off for the massive contract. A sole-source contract award could be politically damaging to the military and the White House, experts said. Northrop appears ready to take advantage of this. In the Dec. 1 letter, Bush tells the DoD acquisition chief that Northrop brass "are aware of how important it is to the credibility of the ultimate KC-X tanker award that it be arrived at competitively."
The threat to pull out of the KC-X race will surely be seen by many in the global defense community as an attempt to force OSD and the Air Force into altering the rules and evaluation criteria spelled out in the draft RfP. Bush added that Northrop officials will soon begin notifying its 200 KC-330 supplier firms that the Northrop-EADS team will not compete for the U.S. Air Force contract.
Bush's letter leaves the door open for a Northrop-EADS bid: "It is my hope that the department will modify its approach to this procurement in a way that will enable us to offer our product for your consideration."
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FLTlt
Have you read the RFP?? It is written in such a way that there is no recognition of extra capability. It is price only. There are 373 mandatory requirements, so the toilet is just as important as the refuelling boom. The RFP is heavily tilted in favour of Boeing. Both planes have the same level of "Built in the USA" items.
As for Airbus withdrawal, Boeing did the same thing last time around.
The Air Force specifications for the tanker put Boeing at a disadvantage
As for Airbus withdrawal, Boeing did the same thing last time around.
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They can see the writing on the wall
the 'Buy American' lobby will guarantee Boeing will win regardless so why should Airbus spend their money on fighting a lost cause.
Hopefully the Pentagon will learn a lesson when Boeing (as the sole available supplier) will now be able to charge an outrageous amount per aircraft (ain't a monopoly wonderful)
A free and fair market is perfectly fine provided American products always win
DM
Hopefully the Pentagon will learn a lesson when Boeing (as the sole available supplier) will now be able to charge an outrageous amount per aircraft (ain't a monopoly wonderful)
A free and fair market is perfectly fine provided American products always win
DM
Ecce Homo! Loquitur...
Thread Starter
373 mandatory requirements, some will require changes to one or both aircraft. e.g. the flow rate for the boom will mean Boeing will have to upgrade or replace their current design. All requirements can be met by a KC-135 sized aircraft.
Only if both bids are within 1 percent are any other factors taken into account.
The lowest bid winds.
based on the RFP Northrup/EADS have 0% of winning, so they'd be wasting their money trying.
If that's what the DoD/the Obama administration want, then fine, be up front about it. I can see the Congress (especially McCain) be up in arms about a single source bid, but also see no reason why Northrup show throw money away to provide a pretence of a competion.
Only if both bids are within 1 percent are any other factors taken into account.
The lowest bid winds.
based on the RFP Northrup/EADS have 0% of winning, so they'd be wasting their money trying.
If that's what the DoD/the Obama administration want, then fine, be up front about it. I can see the Congress (especially McCain) be up in arms about a single source bid, but also see no reason why Northrup show throw money away to provide a pretence of a competion.
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Wasn't the NG bid was cheaper than the Boeing one last time round? If it's not all about price and it's 'capability' that's getting discussed then do the same as Boeing will - promise to meet all 373 points before you've tested anything, then change the contract AFTER it's been signed, when the product doesn't match the promise!
Ecce Homo! Loquitur...
Thread Starter
George Talbot column: Dark days for Northrop's tanker team
Northrop Grumman Corp. has made a "tentative decision" not to bid on the U.S. Air Force tanker contract, according to a top defense analyst. Loren Thompson, an analyst with the Lexington Institute in Arlington, Va., said senior Northrop executives have determined that their KC-30 tanker - a plane that would be assembled in Mobile - can't win under the Air Force's proposed guidelines.
US to go ahead with tanker plane even without Airbus: Gates
WASHINGTON — The Pentagon will go ahead with plans for a new tanker aircraft even if Airbus parent EADS withdraws from the competition for the lucrative contract, Defense Secretary Robert Gates said on Wednesday.
The administration hoped that EADS and its partner Northrop Grumman would not follow through on a threat to pull out of the bidding, Gates said. "But we will move forward. We have to have new tankers," he told the House Armed Services Committee.
Northrop Grumman Corp. has made a "tentative decision" not to bid on the U.S. Air Force tanker contract, according to a top defense analyst. Loren Thompson, an analyst with the Lexington Institute in Arlington, Va., said senior Northrop executives have determined that their KC-30 tanker - a plane that would be assembled in Mobile - can't win under the Air Force's proposed guidelines.
US to go ahead with tanker plane even without Airbus: Gates
WASHINGTON — The Pentagon will go ahead with plans for a new tanker aircraft even if Airbus parent EADS withdraws from the competition for the lucrative contract, Defense Secretary Robert Gates said on Wednesday.
The administration hoped that EADS and its partner Northrop Grumman would not follow through on a threat to pull out of the bidding, Gates said. "But we will move forward. We have to have new tankers," he told the House Armed Services Committee.
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But since Boeing does not know when it will be able to build its KC-777 or how much it will cost, it may not want to comply with the deadline or the fixed-price requirement.
Is it me or is that not just asking for trouble .letting a company who can't even give you. Ball park figure. a contract ok fair deal things over run but to not give a general price is scarry.
Is it me or is that not just asking for trouble .letting a company who can't even give you. Ball park figure. a contract ok fair deal things over run but to not give a general price is scarry.
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fallmonk,
No, the messiah will stand in front of the teleprompter and ensure everyone understands that
"THIS IS THE RIGHT THING TO DO".
Is it me or is that not just asking for trouble .letting a company who can't even give you. Ball park figure. a contract ok fair deal things over run but to not give a general price is scarry.
"THIS IS THE RIGHT THING TO DO".
Ecce Homo! Loquitur...
Thread Starter
AWST (Ares): You've Got to Know When to Hold 'Em
Word emerged today that Alabama GOP Sen. Richard Shelby placed a so-called blanket hold on Obama administration nominees awaiting Senate confirmation. Why? Apparently, a desire to force the Pentagon to alter the final USAF KC-X tanker request for proposals, as Northrop Grumman and EADS want, is one reason.
It's often said - so excuse my abbreviated version - that the Senate works by consensus. Indeed, it really can take just one voting member to bring everything to a halt. Historians and pundits like to call the Senate, where members are elected every six years, the cooling saucer to the boiling cup of passions emerging from the House of Representatives, where the whole chamber stands for public judgment every other year.
Still, as Kenny Rogers said, you've got to know when to hold them, know when to fold them - and here, it seems, the long-time Alabama senator is certainly making a gamble. How will such a blatantly political, bring-home-the-bacon maneuver play when Congress is at record low confidence levels with the U.S. public?
"While by all accounts a Northrop Grumman contract would create significant numbers of jobs in his home state, Shelby's initiative is also a move to secure funding for a company that has long funded him," note watchdogs at the Washington-based Center for Public Integrity.
We'll see, but I do want to note that Boeing and its congressional boosters - I'm looking at you, Washington state delegation - might also want to be careful what they ask for. As Lockheed and its recent Joint Strike Fighter imbroglio proves, winning a massive defense program isn't everything it used to be.
Word emerged today that Alabama GOP Sen. Richard Shelby placed a so-called blanket hold on Obama administration nominees awaiting Senate confirmation. Why? Apparently, a desire to force the Pentagon to alter the final USAF KC-X tanker request for proposals, as Northrop Grumman and EADS want, is one reason.
It's often said - so excuse my abbreviated version - that the Senate works by consensus. Indeed, it really can take just one voting member to bring everything to a halt. Historians and pundits like to call the Senate, where members are elected every six years, the cooling saucer to the boiling cup of passions emerging from the House of Representatives, where the whole chamber stands for public judgment every other year.
Still, as Kenny Rogers said, you've got to know when to hold them, know when to fold them - and here, it seems, the long-time Alabama senator is certainly making a gamble. How will such a blatantly political, bring-home-the-bacon maneuver play when Congress is at record low confidence levels with the U.S. public?
"While by all accounts a Northrop Grumman contract would create significant numbers of jobs in his home state, Shelby's initiative is also a move to secure funding for a company that has long funded him," note watchdogs at the Washington-based Center for Public Integrity.
We'll see, but I do want to note that Boeing and its congressional boosters - I'm looking at you, Washington state delegation - might also want to be careful what they ask for. As Lockheed and its recent Joint Strike Fighter imbroglio proves, winning a massive defense program isn't everything it used to be.
