News Articles

[pm39]

Northrop Rejects Tanker Bid Under Draft RFP

"Northrop executives have complained that the 373 pass/fail requirements outlined for qualification in the competition equally weigh less important items -- such as water flow in sinks and toilets -- with critical capabilities -- such as fuel offload rates.

The USAF's latest cost-shootout approach is also perceived by some observers as favoring the smaller tanker, presumably a Boeing 767-based solution (though Boeing has not announced a design)." AviationWeek.com (12/1)  

http://www.aviationweek.com/aw/generic/story.jsp?id=news/DRAFT120109.xml&headline=Northrop%20Rejects%20Tanker%20Bid%20Under%20Draft%20RFP&channel=defense

So Northrop Grumman won fair and square - then Boeing and their supporters realized they had lost the un-lose-able proposal.

[pm39]

airforce-magazine.com

Daily Report eNewsletter

Friday December 04, 2009

Tanker Saga:

Some industry analysts are not buying the "opt out" declared by Northrop Grumman earlier this week, likening it to similar ones from both Boeing and Northrop in the original KC-X competition. Credit Suisse analyst Robert Spingarn reportedly stated in an industry note, "Northrop's decision to abandon the tanker bid versus Boeing is merely a posturing move in our view." However, others are taking the threat more seriously. Rep. John Murtha (D-Pa.), chairman of the defense appropriations panel, told reporters that Northrop's revelation is a "blow to the program" and planned to talk with Pentagon acquisition chief Ash Carter, perhaps to revisit the split-buy approach he favors. (Northrop backers also recently cited interest in a split award.) Defense analyst Loren Thompson of the Lexington Institute blogs that Northrop's Wes Bush "is quite willing to walk away." (Also see Market Watch report; The Telegraph report; The Hill report; DOD Buzz report)

Not So Firm:

Although a Pentagon spokesman Wednesday discounted the notion of changing requirements in the KC-X competition as outlined in the draft request for proposal just to entice Northrop Grumman to reconsider its threatened pull out, Defense Secretary Robert Gates on the same day no doubt whetted speculation that changes could be made. Testifying on Capitol Hill Wednesday on the Administration's plan for operations in Afghanistan, Gates responded to a tanker-related question, saying, "If we were totally locked in to not changing anything we wouldn't have gone through the [KC-X draft request for proposal] comment period." Although Gates reaffirmed his belief that the draft RFP "is even handed," he acknowledged that there had been "a lot of comments both from the competitors and from the Congress and others." He continued, "We will look at the comments that have been made and make a judgment at that point."

Who Said What:

The threatened pull out from the KC-X tanker competition by Northrop Grumman prompted comments from lawmakers on both sides of the issue. In the Boeing camp, Sen. Sam Brownback (R-Kan.) commented that the Northrop-EADs team had tried this before and said, "Potential bidders should not dictate terms to the Air Force." Another Boeing supporter, Sen. Pat Roberts (R-Kan.), called the situation "sole source blackmail." Northrop tanker backer Sen. Jeff Sessions (R-Ala.) expressed no surprise, saying, "It's been apparent from day one that the Air Force's most recent RFP tilted the playing field toward the less-capable Boeing aircraft." According to a Press-Register report, fellow Northrop supporter Sen. Richard Shelby (R-Ala.) called the current draft RFP a "sham" that is essentially "a sole source contract to Boeing." And, back on the Boeing side, Sen. Patty Murray (D-Wash.) claimed "[Northrop-Eads] Airbus is up to its same old tricks."

[reb]

Of course, here'a an option . . .

http://blog.seattlepi.com/aerospace/archives/190857.asp

Boeing delivers fourth and final Japanese tanker

Boeing delivered the last of four KC-767 aerial refueling tankers to the Japan Ministry of Defense on Jan. 8, the company announced Tuesday.

"Providing Japan with the fourth and final KC-767 tanker on-schedule and on-cost, as we did the previous two KC-767s, means a great deal to our company and our relationship with this important customer," Dennis Muilenburg, president and CEO of Boeing Defense, Space & Security, said in a news release.

The 767-based tanker flew to Japan on Dec. 20 from Boeing's tanker modification facility in Wichita, Kan. Boeing's program partner, Itochu Corp., handed over the tanker to Japan Ministry of Defense officials.

Boeing delivered the first three KC-767 tankers to Japan in February 2008, March 2008 and March 2009. The fleet achieved initial operational capability in March 2009 and Japan's Air Self-Defense Force expects to finish operational evaluation early this year, Boeing said.

Boeing also is under contract to deliver four KC-767s to the Italian Air Force. The company said three of those tankers are in flight test, with the fourth airplane still being modified.


- reb

[Georgia]

Has the Pentagon lost its mind? Its starting to sound like the administration's incessant insistence on things which are not . . .

Seeming contradictions:

"Its lucrative"!? When has this been said in a positive light by a US Government official or reported without condemnation or slur in the media??

Sounds like someone is trying to get public opinion on the side of encouraging a sure loser to spend millions to bid a program with the cards stacked against them?

"It's an important program to us. It's also a very lucrative business opportunity and so I'm hopeful that it'll be seen that way," Carter told a conference hosted by Aviation Week magazine. He underscored the department's hope that both teams would ultimately decide to compete.

"Fair!?" - when only one competitor, Boeing, thinks its fair and many supporters of Boeing wonder why there is a competition at all because it 'should' be given to Boeing.

" . . . we have a fair, open, transparent, right-down-the-middle approach to this,"

"We can't force a competition, but we think we have a fair, open, transparent, right-down-the-middle approach to this," Ashton Carter, the Defense Department's chief weapons buyer, said, when asked if he had concerns about the program becoming a sole-source deal with Boeing.

http://www.reuters.com/article/idUSN1713151620100217?type=marketsNews

Pentagon pitches tanker as "lucrative" opportunity

Pentagon says its approach is open, transparent

WASHINGTON, Feb 17 (Reuters) - The Pentagon on Wednesday defended its approach to a multibillion-dollar aerial refueling competition as fair and transparent, and said it clearly offered a "lucrative" opportunity for potential bidders.

Northrop Grumman Corp (NOC.N) and its European partner EADS (EAD.PA) have said they will not compete for a projected $35 billion order for new planes unless the U.S. Air Force makes significant changes to draft rules that Northrop says clearly favor its competitor, Boeing Co (BA.N).

"We can't force a competition, but we think we have a fair, open, transparent, right-down-the-middle approach to this," Ashton Carter, the Defense Department's chief weapons buyer, said, when asked if he had concerns about the program becoming a sole-source deal with Boeing.

"It's an important program to us. It's also a very lucrative business opportunity and so I'm hopeful that it'll be seen that way," Carter told a conference hosted by Aviation Week magazine. He underscored the department's hope that both teams would ultimately decide to compete.

The Air Force has said it will issue a final request for proposals soon, but not before Feb. 23, in its 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 s****ped the first plan, a $23.5 billion deal under which the Air Force planned to lease and buy 100 Boeing 767-based tankers amid a major procurement scandal that sent a former Air Force official to prison.

The Pentagon canceled the second attempt after government auditors upheld a Boeing protest of a contract valued at around $35 billion that was awarded to Northrop and EADS 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, editing by Maureen Bavdek)

[oxr]

So RFP III is a reality.

If Las Vegas set the line at 3 1/2 RFPs, who wants to take the over?

Where were you when this started? Where did you live? Where did you work? How many new products has Apple introduced (or versions of Windows/Vista have been released) since the original requirement was validated?

just a thought... 

[reb]

and there you have it . . .

http://www.marketwatch.com/story/northrop-abandons-bid-to-make-us-aerial-tankers-2010-03-08?reflink=MW_news_stmp

http://www.foxnews.com/politics/2010/03/08/northrop-drops-competition-pentagon-tanker-contract/?test=latestnews

- reb

[reb]

US tanker bid war heats up with Airbus, Russia in wings

by Staff Writers
Washington (AFP) March 19, 2010

The US Air Force tanker bidding contest against Boeing heated up Friday, with Airbus parent EADS mulling a proposal and Russia's state firm UAC gearing up for one next week.
EADS opened the door to a bid against US arch-rival Boeing for the 35-billion-dollar aerial refueling tanker contract on signs of Pentagon willingness to extend the May deadline.

The European Aeronautic Defence and Space Company's expressed interest in the competition, and the surprise emergence of a Russian competitor late Friday, marked new twists in the long-running saga to replace the aging Boeing fleet.

Just last week EADS, the parent of Airbus, was forced to withdraw from the bidding after its lead partner, US defense contractor Northrop Grumman, refused to compete, alleging the requirements were skewed in favor of Boeing.

Northrop's exit from the competition left the field open to the Chicago-based Boeing, the aerospace giant that built the tanker fleet in the 1950s and has promised a formal bid by May 10.

Military commanders view the planned KC-X aircraft as crucial to sustaining US air power and are anxious to replace the older Boeing KC-135 Stratotankers.

The turning point for EADS appeared late Thursday, when the Defense Department acknowledged it would consider "a reasonable extension" to the bidding deadline after learning from EADS it may reenter the fray.

"Yesterday the US Department of Defense (DoD) indicated it would welcome a proposal from EADS North America as prime contractor for the KC-X tanker competition," EADS said in a statement Friday.

"This is a significant development. EADS is assessing this new situation to determine if the company can feasibly submit a responsive proposal to the department's request for proposal," the company said.

Northrop declined to comment on the EADS statement.

EADS said it appreciated the Pentagon's signal of willingness to extend the time frame, but "in the end, the company will only submit a proposal if there is a fair chance to win, after evaluating all relevant factors."

EADS said "an important prerequisite" for its consideration of entry into the competition to provide 179 tankers would be "a significant extension to the period within which to prepare and submit a proposal."

The Defense Department, meanwhile, said that EADS was seeking a 90-day extension of the deadline.

"We would consider reasonable extensions," Pentagon spokesman Bryan Whitman said, adding that the "next step is for them to give us some specifics in terms of what they need the additional time for."

The Pentagon spokesman confirmed that EADS could bid to be the sole contractor without a US partner "as long as they meet the requirements."

The field appeared to widen suddenly to at least a two-way race after a lawyer representing Russian state-owned aerospace group United Aircraft Corporation said the company would enter a bid with a US partner.

"They're going to announce Monday a joint venture with an American company to bid on the tanker program," attorney John Kirkland told AFP.

Kirkland did not identify the US firm but said it was publicly traded.

The DoD could not immediately confirm the upcoming Russian bid.

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

According to a source familiar with the situation, UAC will propose a tanker version of its Ilyushin IL-96, to be built in Russia and assembled in the US southeastern region.

"Bizarre!" said Richard Aboulafia, vice president of analysis at the Teal Group.

"They have no chance at all. In addition to the obvious security concerns, there are strong doubts about their ability to create a jetliner that's up to Airbus or Boeing standards. Even if they did, the political obstacles would be insurmountable," he said in an email.

The Northrop-EADS withdrawal from the race has triggered an uproar in Europe, with French President Nicolas Sarkozy and German Chancellor Angela Merkel this week accusing Washington of bias in favor of the all-American Boeing plane.

The team had won the contract in February 2008, but the deal was canceled after a successful Boeing appeal to the investigative arm of Congress.

In 2003, the Pentagon awarded a contract to Boeing but later suspended it after an ethics scandal involving a company executive and an Air Force official. The Air Force official was later convicted of criminal conspiracy.



- reb

[reb]

Russian state firm to bid for US tanker contract: lawyer

New York (AFP)
March 19, 2010

Russian state-owned aerospace group United Aircraft Corporation plans to bid for a US Air Force tanker contract, teaming up with a US partner, a lawyer representing UAC said Friday. "They're going to announce Monday a joint venture with an American company to bid on the tanker program," attorney John Kirkland told AFP. US aerospace giant Boeing is the only company that has announced it will bid for the 35-billion-contract to supply the air force with 179 aerial refueling tankers. EADS, the parent of Boeing's arch-rival Airbus, said Friday it was considering a bid for the contract after the Pentagon signaled a flexible deadline to accommodate the European aerospace giant.

Just last week EADS was forced to withdraw from the bidding after its lead partner, US defense contractor Northrop Grumman, refused to compete, alleging the requirements unfairly were skewed toward Boeing's smaller aircraft. UAC was launched in 2006 under the administration of then-president Vladimir Putin. The UAC move Friday coincided with talks in Moscow between US Secretary of State Hillary Clinton and Putin, the Russian prime minister. Putin lamented that bilateral trade had plummeted in 2009 as a result of the economic crisis to 16 billion dollars, from 36 billion dollars, although he said the economic potential of the US-Russia partnership remained high. "I appreciate you raising the economic relationship because we are committed to broadening and deepening ties between our two economies, our business leaders and investors," Clinton said.


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[reb]

EADS urges 90-day extension on tanker jet tender: US

Washington (AFP)
March 19, 2010

European airspace giant EADS has called for a 90-day extension to the tendering process for a multi-billion-dollar deal to supply the US air force with tanker jets, a Pentagon official said Friday. "They've indicated to the department that they would like to see us extend the time frame 90 days," spokesman Bryan Whitman said. The tendering process is due to close around mid-May. "We would consider reasonable extensions," Whitman said, adding that the "next step is for them to give us some specifics in terms of what they need the additional time for." He confirmed that EADS could put in a bid to be the sole contractor without a US partner "as long as they meet the requirements." EADS said earlier it may submit a new offer to try to clinch the deal if revised Pentagon tender rules gave it a fair chance of success. Last week, EADS angrily pulled out of the race for the 35-billion-dollar (26-billion-euro) contract to supply 179 tanker planes, alleging the Pentagon had skewed its requirements to favor its US rival Boeing.

- reb

[oxr]

So do they want an extension if the tender rules are not changed?

Really, if you've been involved with a procurement of this complexity, do you think 90 days would be enough time to put together an entire new deal? Or is this just 90 days to give them time to think of something else? How long would it take to just build a new team, or make a corporate financial decision to go it alone?

Great spectator sport...