US Reopens Air Force Tanker Contract Bidding
The US government has reopened bidding for its new air tanker contract – news that, upon its emergence on 9th July, sent previous winner EADS’ shares tumbling three per cent.
EADS, together with collaborator Northrop Grumman, was announced as the victor over Boeing, but now the US has highlighted how errors were made during the bid evaluation process.
Boeing KC-767
Consequently, Boeing will be permitted to put forward its KC-767 once again.
In the minds of several industry analysts, EADS will now struggle to re-capture its crown, and many are now concerned that jobs could be lost.
The USAF’s verdict when selecting the future air tanker winner caused controversy in the US as, for one thing, it ended a legacy of home-grown products having been used in the air force refuelling role.
Northrop Grumman/ EADS KC-30
Although the Northrop Grumman/ EADS KC-30 would be pieced together by US assembly workers, the aircraft parts would, in the main, be manufactured in Europe.
GAO Report
In the wake of Boeing’s losing bid, it – together with a group of Senators – lobbied to force the bidding process open again. Assessing the decision, the US GAO (Government Accountability Office) highlighted last month how “significant errors” had occurred, and said Boeing should be allowed to bid again.
One factor was that of cost as, at first, it seemed the Northrop Grumman/ EADS aircraft would deliver better value over the course of its service life. After subsequent re-evaluation, however, Boeing’s KC-767 appeared the better choice, according to the GAO.
While many anticipated that the bidding would be re-opened, the decision still stands as a deep cut to EADS’ aspirations stateside.
"The new competition will be doubly difficult for any non-American challenger, i.e. EADS, to actually win because politics will decide who will win this competition", aerospace analyst Howard Wheeldon said in comments made to the BBC.
”It alters the perspective on their ability to grow in the US, which is a very important market for them", he added.
Boeing’s Response
While responding positively to the news, Boeing also expressed fear over the prospect of variations in the selection process this time around.
"It's encouraging that the Defense Department intends to take steps to ensure a fair and open competition that, among other things, fully accounts for life-cycle costs, such as fuel, to provide the most capable tanker at the best value for the American taxpayer", the US firm stated.
Northrop Grumman’s Response
As far as Northrop Grumman was concerned, meanwhile, the choice had been made as regards the “best tanker”.
"We are reviewing the decision to ensure the re-competition will provide both companies a fair opportunity to present the strengths of their proposals", it said.
It is anticipated that the Pentagon – which has now replaced the USAF in the bidding process – will choose the ultimate winner in coming months.
Armed Forces International will continue to provide coverage of the very latest news concerning the USAF tanker contract bidding as more facts emerge.
Source – Armed Forces International’s Aviation Expert
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