Friday, June 27, 2008

HASC Tanker Briefing Round Up

Yesterday the Air and Land Subcommittee of the HASC met with GAO officials and a last minute DoD procurement stand-in for the Sue Payton.

From the reports we received, it is clear that the majority of members came away from the brief more convinced then ever that the Air Force has continually misled Congress about the tanker selection process.

By their remarks, even those Members who support the KC-30 seemed to have concluded that GAO did a thorough job in rendering its decision and that the reasons for rebidding the contract are compelling and overwhelming.

When questioned if the GAO believed that the was malice directed against Boeing, the reply was that they did not believe so. But, they did mentioned that there was pattern of incompetence that clearly resulted in favoring the KC-30.

Chairman Abercrombie, who reportedly was none to happy with what he heard yesterday, has scheduled another Air and Land Forces Subcommittee hearing on the tanker contract for July 10th. This time around Ms. Payton and DoD acquisition chief John Young are expect to be in attendance.

12 comments:

Aurora said...

The GAO has provided the Air Force with the way out of this nightmare. NG/EADS' proposal was "non responsive". Reverse the decision and award this to the KC-767. DOD has its hands full on two fronts, Iraq and Afghanistan. They don't need another front on the Hill.

This gang is running out of time (and options) anyway; six, seven months is what they have left. DOD could choose to punt this to the next administration, like they did with the F-22, but this would allow the Democrats to tar McCain during the campaign with this issue. Take it off the table and do the right thing. This process was flawed at best; at worst...no, I don't want to go there just now.

ewaggin said...

Question: Contracting Procedure

Articles that I've been reading, and posts here at TWB, variously use "reopen", "rebid", "recompete", etc, when discussing where the tanker contract is going next.

Are these terms interchangeable?

Given the magnitude of the mistakes in the contract award (as documented by the GAO report), it seems that the next step would be to correct the factual errors.

This would certainly include the various pricing errors that resulted in the MPLCC of the Boeing bid being inflated.

It might also include a determination that Airbus was ineligible for an award, due to their failure to meet two of the mandatory criteria.

So, what is the proper term to use when making corrections to a botched contract award?

"Reopen" might imply this; "rebid" and "recompete" seem to imply giving Airbus a second bite at the apple, which would be unacceptable.

Anonymous said...

Let the contract stand as awarded and the USAF will have Tankers.

Anonymous said...

Let the contract stand as awarded and the USAF will have Tankers.


No they won't, because Congress would neither appropriate the money nor authorize it to be spent on this contract with all the violations of procurement law and practices that occurred.

The only quick option would be to disqualify EADS for being 'non responsive' and award the contract to Boeing.

If they try to rebid it with the same RFP, it'll be a slam-dunk for Boeing. Without the numerous violations of the original RFP that were done in the selection criteria, the EADS entry was not even remotely competitive. The RFP called for a MEDIUM tanker, not another LARGE tanker like the KC-10A the USAF already has.

If they change the RFP, they will need to go through the whole process again, and Boeing will then offer a KC-777 tanker...more capable by far than the A330 based aircraft. But the process will take two years.

Those are the real options, if you think there are others, you're deceiving yourself.

Anonymous said...

Boeing can not afford to offer the B777 tanker or the time to develop one. The initial cost would double over the B767 tanker.

Boeing knew this, that is why they offered the B767.

If the USAF rebids the KC-X tanker contract, the contract most likely be tailored to the KC-30 which will make Boeing bid the KC777. Again, Boeing will lose the contract to NG/EADS and start the whining process all over again.

Anonymous said...

if they tailor a new contract to fit the -30 boy will this look like a big set up, the first tailored for a med then changed then ok we will tailor it for a big one. You would have to be stupid not to see what is going on here.

Anonymous said...

Boeing can not afford to offer the B777 tanker or the time to develop one. The initial cost would double over the B767 tanker.

Boeing knew this, that is why they offered the B767.


That's just pure ignorance. They had already done substantial prelim work for the KC-777. In fact, they were touting it for this contract, until the RFP specified a MEDIUM tanker:

http://seattlepi.nwsource.com/business/286578_air27.html

http://www.strategypage.com/htmw/htairmo/articles/20070131.aspx

http://goliath.ecnext.com/coms2/summary_0198-350756_ITM

http://en.wikipedia.org/wiki/Boeing_777#777_Tanker_.28KC-777.29


Boeing offered the KC-767 because it was RESPONSIVE TO THE RFP. Had the Air Force not illegally changed the selection criteria specified in their own RFP, the 767 would have won.

This was a MAJOR violation of procurement law, one of the reasons the GAO issued such a scathing report and authorized that the Boeing Corporations costs of the preparing the protest be paid for by the taxpayers.

If the Air Force truly wants a KC-10A replacement, they can put it in the RFP and let Boeing and Airbus bid on it and let the chips fall where they may. What they CAN'T do, is change the RFP designated criteria after the fact to favor one bidder, and that is precisely what they did.

So if the original RFP was valid, the USAF ought to disqualify the Airbus entry as non-responsive and award the contract to Boeing. If the original RFP did not truly reflect mission requirements, they need to find out who approved it to begin with and can him/her, then determine a VALID RFP and go through the whole process over again.

Nothing else will work, and anyone telling people in Alabama that somehow Congress is going to fund the tanker if the USAF does anything else is simply setting them up for disappointment.

Anonymous said...

...What if the AF rebids and asks for a LARGE tanker, Boeing shows up with the 777 and Northrop with the A310 and NG wins again, or better yet Bob Stevens digs up the old tooling on the L1011 and the AF splits it between NG and LM...

Anonymous said...

I did not say they are going to tailor the contract for the KC30, but that Boeing has nothing to compete with, value wise, to support the USAF's needs.

Anonymous said...

I did not say they are going to tailor the contract for the KC30, but that Boeing has nothing to compete with, value wise, to support the USAF's needs.

Apparently the GAO's opinion differs from yours. They said the Air Force “made a number of significant errors that could have affected the outcome of what was a close competition between ..."

Absent these procedural errors, they believe the Boeing bid may well have won. Henct the reason they both supported the Boeing objection and ordered the government to pay Boeing's costs of lodging the objection.

Perhaps you need to find a different way to spin your displeasure.

Anonymous said...

...What if the AF rebids and asks for a LARGE tanker, Boeing shows up with the 777 and Northrop with the A310 and NG wins again, or better yet Bob Stevens digs up the old tooling on the L1011 and the AF splits it between NG and LM...

What if the Cubs win the pennant?

The Air Force HAS a Large Tanker. It's called the KC-10A extender, made by McDonnell Douglas (now a part of Boeing Aircraft). It would seem easier to resurrect THAT assembly line than to recreate the L-1011 (out of production since 1984). Also, the middle engine on the L1011 exhausts much lower than the middle engine on the KC-10, posing turbulence problems to T-tailed large aircraft (C-17s).

The A310 might have made sense for this competition since it is indeed a MEDIUM aircraft and is already the testbed for the boom that Airbus hopes someday to get operational on the A330 tanker, but it is probably too small to win a LARGE tanker competition...unless of course, the USAF completely ignores the requirement for the LARGE tanker RFP like it did this one for a MEDIUM tanker RFP.

But as I said, any change of the RFP like that puts this program back to square one...probably three years away from a source selection.

Splitting the contract would probably be the stupidest thing the Air Force could do (doesn't mean they won't do it, though), since this would cause them to bear development costs for BOTH programs while forfeiting advantages of economy of scale in the production process. Worse yet, they now have to provide logistics for both airframes.

The fact of the matter is that N-G isn't going to be able to make this source-selection stick, and the Air Force is going to have all the oversight in the world on the next one since they have now screwed this up twice.

Can Airbus win in that environment? I don't know how they would. They are being killed by the weak dollar tight now, they have problems with the A380, the A350XWB, and the A400M. Their senior execs are under indictment for insider trading, their Power 8 restructuring is falling apart over fights with the politicians and the unions....I mean....damn...buying from Ilyushin would probably be smarter than buying from Airbus right now.

Anonymous said...

Anonymous June 30, 2008 7:12 PM
That's just pure ignorance. They had already done substantial prelim work for the KC-777.

From your first link (September 27, 2006):
Eight KC-767s are already in development. They are being built for the air forces of Japan and Italy. It would take about three years to modify the 777 into a tanker, McGraw said.
None of the tankers for Italy or Japan are ready for mission today. I doubt the three years time. Boeing's preliminary considerations are in my opinion just some CGIs.

Source #2:
Boeing developed the KC-767, at a cost of nearly a billion dollars, on its own.

Anonymous:
In fact, they were touting it for this contract, until the RFP specified a MEDIUM tanker:
RFP didn't specify any size of aircraft. RFP specified requirements like minimum fuel offload capability or maximum takeoff run lengths. There KC-777 sucks with 11,600 ft. 777-200ER also got highest pressure on tarmac of all civil aircrafts. Just B-52 puts more pressure on apron.
Source #1:
That plane [A330-200] is bigger than the 767 but considerably smaller than the 777.
MTOW for KC-767 is 400,000 lb, KC-45 500,000 lb, KC-10 590,000 lb and KC-777 would be 770,000 lb.

Calling KC-45 a LARGE tanker is just a name game. 767 and A330 are considered MEDIUM within civil aviation.

So if the original RFP was valid, the USAF ought to disqualify the Airbus entry as non-responsive and award the contract to Boeing.
USAF won’t do that. To change assessment after rating it OK is something GAO criticized.

Source #1:
Some Air Force generals have said that they favor having more planes in the sky during a war to refuel thirsty fighters, not fewer.
Some Navy generals want more planes with hose-drogue equipment. That'll be also a solution for Air Force.
http://digital.library.unt.edu/govdocs/crs/permalink/meta-crs-9722:1

Nothing else will work, and anyone telling people in Alabama that somehow Congress is going to fund the tanker if the USAF does anything else is simply setting them up for disappointment.

Air Force may use KC-135 order style.


A few more cites from your links:

Source #2 (January 31, 2007):
Bigger is sometimes better if you're a flying gas station. […] Using the KC-777 would reduce the number of tankers needed from 179 to 120, or less, and be cheaper in the long run.
The bigger is better only counts as long as Boeing got the bigger aircraft in competition?

Source #2:
There is risk in keeping 40 year old aircraft flying, but the safety record of the KC-135 remains excellent.

US Air Force lost so far 62 out of 761 Stratotanker through accidents . 4 were lost due to problems during aerial refueling. None aircraft was lost due to enemy action.