Posted by: Tim Lincoln | November 19, 2009

Will the USAF ever get a new tanker?

Earlier this year the US Air Force indicated that it was ready to hold another competition for a new Tanker/Transport aircraft to replace the aging KC-135 and KC-10 aircraft, which are becoming increasingly expensive to maintain and operate. Previous attempts to purchase replacement aircraft were halted, the first attempt because the purchase was awarded to Boeing without any competition (and the person who awarded the contract later accepted a job at Boeing), and the second attempt after Boeing successfully protested the contract being awarded to an Airbus/Northrop Grumman team.

In the last competition, the Air Force provided a handful of “must have” requirements that needed to be met, and nearly 800 “nice to have” requirements with very little explanation of how those requirements would be calculated towards the award. The most recent request for proposals (RFP), issued September 24th, has 378 mandatory requirements and 93 non-mandatory requirements. Each of the mandatory requirements must be met for the proposal to be considered at all, and the non-mandatory requirements only come into play if the final value of the proposals are within 1% of each other. This time around, the calculations going into the proposals are clearly spelled out, so there is no room for confusion. Or at least, there shouldn’t be. The Air force has also indicated that they will be selecting an aircraft based on the best value, and not the lowest price.

So on the surface it seems as though this third attempt at obtaining a replacement aircraft for the Air Force will go more smoothly. However, several legislators are now jumping on the World Trade Organization’s (WTO) recent ruling that Airbus had received unfair government subsidies in the development of some of their aircraft to argue that the Airbus/Northrop Grumman team should be handicapped in the competition. Never mind the fact that a similar case is still being investigated against Boeing. Most experts expect the WTO to find that Boeing has also received unfair government support, so does that mean Boeing should be handicapped in the competition as well?

It seems like everyone is conveniently ignoring the fact that more than half of the Airbus/Northrop Grumman proposal will be built in the US, or that a large portion of Boeing’s proposal is manufactured outside of the US. That’s right. Boeing’s aircraft may be assembled in the US, but they certainly are not manufactured in the US. Why can’t we just let the Air force say “This is what we need,” let the bidders provide their proposals on how best to meet that need, and go with the best value for the taxpayer. Let’s leave politics out of this.

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