Boeing Wins USAF KC-X Tanker Contract

hornetguy

hornetguy

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http://news.yahoo.com/s/nm/20110224/bs_nm/us_usa_tanker
WASHINGTON (Reuters) – Boeing Co was the "clear winner" in a U.S. Air Force tanker competition, the Pentagon said on Thursday, surprising analysts who had expected Europe's EADS to win the deal.

U.S. Air Force Secretary Michael Donley told reporters the contract was worth over $30 billion and Boeing's shares rose 3.5 percent in after-hours trading.

Boeing, which could still face a contract protest from Airbus parent EADS, was awarded an initial $3.5 billion to design and deliver 18 planes.

It is the third effort in nearly decade to start replacing the Air Force's Boeing-built KC-135 Stratotankers, built before man first landed on the moon.

The contest has sparked transatlantic tensions and clashes in Congress among lawmakers eager to bring high-paying aerospace jobs to their states.

"Boeing was the clear winner," Deputy Defense Secretary William Lynn told reporters at the Pentagon.

He said EADS could protest the decision, but the Pentagon was convinced the decision was fair and transparent and there would be no grounds for a protest.

"We think we've established a clear, a transparent and an open process and we think we've executed on that and it will not yield grounds for protest," Lynn told the briefing.

EADS last week said it would only protest if it saw egregious errors. On Thursday, it expressed disappointment and concern about the decision, but said the contract was just "one business opportunity among many" in the United States.

EADS did not say if it planned a protest. Company officials say they will wait until after a formal briefing by the Air Force, which is likely to occur on Wednesday.

EADS has 10 days to file a formal protest after a contract award and its congressional backers can also try to block the award legislatively. Several Alabama lawmakers said they would examine the decision carefully to ensure it was fair.

Teal Group analyst Richard Aboulafia called the decision "a major surprise" and said if it holds, Boeing will have succeeded in blocking EADS's biggest defense initiative.

Aerial refueling tankers supply fuel to fighter planes and other aircraft in mid-flight, extending the range of military operations.

Air Force Chief of Staff General Norton Schwartz said he was pleased that troops would finally get a new refueling plane. "Let me just say that I'm pleased that this has produced an outcome ... that we'll get about delivering a capability that's long overdue -- and we'll stop talking about it."

EADS and Boeing, arch rivals in the market for passenger jets, have fought bitterly in public over the contest with expensive advertisements while their respective supporters have battled it out at dueling news conferences.

The decision disappointed EADS backers in the South, who had hoped work on EADS' A330-based tanker in Mobile, Alabama would boost a region still struggling with the aftermath of Hurricane Katrina in 2005 and last year's BP oil spill.

Alabama Governor Robert Bentley put a brave face on the news, telling hundreds of officials and business leaders: "There's sunshine above the clouds. We are going to still work hard and we are going to still create jobs in this area."

Boeing offered a variant of its 767 twin-engined, wide-body passenger jet, to be built in Washington state and Kansas.

Brian Ruttenbur, a defense analyst with Morgan Keegan, said the decision gives Boeing "a shot in the arm" as the company looks to fix issues with its 787 commercial plane program.

"Especially with all the Dreamliner issues they are having, they needed something," Ruttenbur said.

Pentagon officials declined to give any details from the bids, saying only that the two offers were more than one percent apart.

The Air Force has been trying since 2001 to begin replacing its Boeing-built KC-135 tankers.

An initial $23.5 billion plan to lease and then buy 100 modified Boeing 767s as tankers, fell apart in 2004.

EADS, partnered with Northrop Grumman Corp, won a 179-plane deal in February 2008, only to have it canceled after government auditors upheld parts of a protest by Boeing.

Northrop subsequently pulled out, leaving the European aerospace and defense company to bid alone.

Documents from the previous competition showed an average price for the Airbus plane of $160 million versus $168 million for the Boeing plane, but analysts say the price could wind up being 5 to 10 percent lower this time.

Shares of Boeing rose 3.5 percent to $73.25 in after-hours trading on Thursday after closing up 0.8 percent to $70.76 in regular trading on the New York Stock Exchange.
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Calls from the Congressional delegates from Georgia to vote against this, and law-suit from EADS/Northrop protesting the decision in 4, 3, 2......
 
Interestingly, Dennis Muilenberg, the CEO of Boeing Defense, Space, and Security was speaking this afternoon at USAFA for the NCLS. His presentation was interrupted so that he could take a phone call giving him this news. He returned to tell the cadets that he was just given the news that the decision had been made, but he didn't tell anyone who had won. Son said he did seem pretty happy, so they figured Boeing had won. A quick check of the news on thier phones confirmed it.

Stealth_81
 
I will control myself here because I am a "dual" pilot: fighters and tankers. Mostly in tankers, the venerable KC-135A/E/Q/R...

SHORT Steve rant... :rant2:

WRONG JET. Gives us NOTHING more than the KC-135R can do now except carry palletized freight on a steel floor. BUT...if you put cargo on it, it must be refueled inflight because it can't take off with a load of fuel. Weight limitation.

There's a LOT more...

But...the decision is made. We now salute and move forward.

Steve
USAFA ALO
USAFA '83
 
flieger83 said:
I will control myself here because I am a "dual" pilot: fighters and tankers. Mostly in tankers, the venerable KC-135A/E/Q/R...

SHORT Steve rant... :rant2:

WRONG JET. Gives us NOTHING more than the KC-135R can do now except carry palletized freight on a steel floor. BUT...if you put cargo on it, it must be refueled inflight because it can't take off with a load of fuel. Weight limitation.

There's a LOT more...

But...the decision is made. We now salute and move forward.

Steve
USAFA ALO
USAFA '83
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I doubt it. I don't believe it's the wrong jet, it met the requirements. And you can bet that this time around, after the program was taken away from AF Acquisitions and given to DOD to run for a while and the countless extra time they took leading up to the decision and final award they think they can head off a protest. We'll see soon enough obviously. If your scenario was important then it would have been expressly required and if it didn't meet it then I seriously doubt it would have won this competition because they went way out of their way to redo the requirements and bulletproof from different perspectives. Next week's debriefs will be interesting for sure...
 
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Steve,

I don't think they were really looking for it to improve on the KC-135 so much as to replace them before they fall apart?

Though 2 engines vs. 4 HAS to be a better fuel efficiency.

This is actually really interesting for me. I'm on a RAND project seeking to reduce AMC fuel use by 10% by 2015. This is an interesting component we can add now for improving efficiency, even if the introduction doesn't occur until after 2015.
 
What exactly were the grounds the decision was based on?
 
hornetguy said:
Steve,

I don't think they were really looking for it to improve on the KC-135 so much as to replace them before they fall apart?

Though 2 engines vs. 4 HAS to be a better fuel efficiency.

This is actually really interesting for me. I'm on a RAND project seeking to reduce AMC fuel use by 10% by 2015. This is an interesting component we can add now for improving efficiency, even if the introduction doesn't occur until after 2015.
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A little digging will show that...

The '767 can launch with about 2600 pounds more fuel on max takeoff. But it will burn over 3000 more on SETTOAC. Then when it's level...especially on a fighter drag, it's constrained with ETOPS. Not a BIG problem but still...it's there.

And if you want to use it as a freighter...there's that weight issue...load it up, it must take off nearly empty and then refuel...

Nope, IMHO, it's the wrong choice.

But then..I'm just an operator, not a politician. :shake:

Steve
USAFA ALO
USAFA '83
 
Where is that info posted? If there is similar info for the -135 and -10A, I would really like to have it!!!
 
hornetguy said:
Where is that info posted? If there is similar info for the -135 and -10A, I would really like to have it!!!
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That was posted by the AF/Boeing/EADS a couple of years...I will look to see if I can find it in a format to publish.

Steve
USAFA ALO
USAFA '83
 
Chockstock said:
What exactly were the grounds the decision was based on?
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Good Question!! I would also like to know the definition of "clear winner" as probably would the good people of Mobile.

Nevertheless - someone was going to come up on the short end of the stick. Hopefully, the process was indeed conducted 'fairly'.
 
Via my project today:

Fuel Burn Costs May Have Tipped KC-X Scales in Boeing’s Favor

While some may wonder why Boeing with its NewGen Tanker offering based off a smaller, older 767 design beat out EADS Airbus A330-based KC-45 to win the KC-X contract yesterday, it’s likely a matter of fuel efficiency and construction costs associated with housing the new jets.

From DoDBuzz:

The difference between the two bids may have come down the difference in fuel consumption, speculated Loren Thompson, defense consultant and analyst at the Lexington Institute. “The Airbus plane burns over one ton more of fuel per flight hour than the Boeing plane. Multiply that by 40 years and that’s a lot of money,” Thompson said. Boeing has argued for some time that its fuel consumption rate would save taxpayers “tens of billions” of dollars over the life of the program.

There’s also the question of military construction. Remember, both planes was also evaluated by how much cash the Air Force would have to spend to upgrade infrastructure at bases that currently house KC-135s to accommodate the larger Boeing and EADS jets. While the 767 is big, the A330 is a lot bigger. This might mean that modifications to things like ramps and hangars may cost more to accommodate the EADS jet. We won’t know for sure on this until the Pentagon tells us.

Another factor may be the number of tails the Air Force can deploy to crowded bases around the world. Naturally, you can fit more of the smaller 767s on a ramp than the A330. Again, we’ll see if this played a role in the decision to go with the Boeing plane.

Read more: http://defensetech.org/2011/02/25/f...d-kc-x-scales-in-boeings-favor/#ixzz1EzxX4nnH
Defense.org
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random questions

With more unmanned aircrafts (smaller) projected to replace manned aircrafts (larger), does aerial refueling requirement change?

is more refueling capacity per refuler necessarily better? I assume it will be very complex. Suppose we need to refuel one C 17 on a mission, would we need two Boeing vs one Airbus?
 
Not someone with that type of background, but the 1st thing that came to my mind was if they need to re-fuel a C17 the bigger issue would be about busting crew rest.

It is not only about how much fuel, but pilots have regs of how many hours they can fly in a day and how many time zones they an cross before being mandated to sit down.
 
There's a mixed fleet of tankers for a reason just like there's no one size fits all figher or cargo plane. We didn't just make every cargo plane huge like a C-5 or smaller like a C-130.

There's a job a KC-10 does and there's the more often needed smaller job a KC-135 does just fine. Also, often refueling resources are pre-positioned to support a mission. You can see tankers temporarily staging out of Lajes to support some transatlantic missions or contigencys. Tankers don't have to be dragged along the whole mission along with their customers all the time.
 
About a month ago, I was returning from Kansas City back to DC from a business trip. I sat next to a United pilot who was deadheading for his 4 day trip. Turns out he flies KC-135's for the Air National Guard in Kansas. Also flies the Airbus for United. We struck up a nice conversation as I flew many mission tanking flights in the S-3A/B when I was on active duty. When we got around to the Boeing/EADS competition, he had some very interesting things to say. Primarily, the Airbus' avionics are very fragile and require MANY hours of maintenance compared to a modern Boeing aircraft. I've heard from many of my airline pilot friends that the Airbus is a "toy". He was concerned that desert ops would be a nightmare for this plane. He also indicated that Boeing aircraft use a lot of the same terminology, whether KC-135 (old) or 777 (new) and that would make for an easier transition for the KC-135 crews. Since he flies both types of aircraft, I found this to be very compelling for favoring Boeing. Any other board members want to chime in? I'd be interested to hear your opinions.
 
Bird85 said:
About a month ago, I was returning from Kansas City back to DC from a business trip. I sat next to a United pilot who was deadheading for his 4 day trip. Turns out he flies KC-135's for the Air National Guard in Kansas. Also flies the Airbus for United. We struck up a nice conversation as I flew many mission tanking flights in the S-3A/B when I was on active duty. When we got around to the Boeing/EADS competition, he had some very interesting things to say. Primarily, the Airbus' avionics are very fragile and require MANY hours of maintenance compared to a modern Boeing aircraft. I've heard from many of my airline pilot friends that the Airbus is a "toy". He was concerned that desert ops would be a nightmare for this plane. He also indicated that Boeing aircraft use a lot of the same terminology, whether KC-135 (old) or 777 (new) and that would make for an easier transition for the KC-135 crews. Since he flies both types of aircraft, I found this to be very compelling for favoring Boeing. Any other board members want to chime in? I'd be interested to hear your opinions.
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What comes up most often at work when discussing the avionics differences has to do with 'man in the loop' philosophy Boeing adapts vs. Airbus's. There's LOTS of academic literature and LOTS of A vs B forums that go back and forth. But a common complaint some have with Airbus is that the lack of some accuities between pilot and copilot (one stick doesn't move when the other is) and when autopilot is engaged and controls not moving reminds some pilots of a "toy" or incomplete execution of a design. Maybe that's part of what he meant. For example, the recent Nova show on Air France 447 that was lost over the Atlantic showed weaknesses in the design of not having the throttle quadrant actually move during some scenarios.

When it comes to our house though, everyone in our family will quickly jump on the transatlatic flight we took on a medium sized Airbus plane where the right mid cabin bathroom overflowed and no one could get it to stop. Crew's solution was to round up every airline pillow and blanket and stuff the bathroom full of them to soak up the crap and keep it off limits for the remainder of the flight. Needless to say, it stunk...

Here's my favorite aviation blogger. Caution, you will learn a lot and laugh and will bookmark this site as a favorite and get addicted to reading it. All you have to do is look at the pictures up and down the right hand side of his blog to know where he's coming from. He pilots an airbus now and discusses the Air France 447 Nova show from his perspective. I think some of his older posts discuss the A vs B fairly objectively.

http://flightlevel390.blogspot.com/

Be sure to check out his links to other aviation blogs. I get a kick out of Sulako too http://sulako.blogspot.com/

Here's examples of summary stuff on the i'net on A vs B cockpit philosophy.

http://www.myfearofflying.com/article.asp?aId=7
http://www.seattlepi.com/business/boe202.shtml


The winning tanker is going to be based heavily off the 787. The 787's cockpit is impressive to say the least so any pilot would drool over having that on a tanker! I can't help but wonder if pilots knew picking the Boeing tanker meant an awesome future airline resume for the 787 :cool:
http://www.airliners.net/photo/Boei...43848/L/&sid=1002b3b3029cbcc95268792330dedc99

Here's an overall summary that shows it's not the same tanker they built already for Italy and Japan (how many knew Boeing already had 2 tanker models built off the 767?) Based on the proven Boeing 767 commercial airplane, the KC-46A Tanker is a widebody, multi-mission aircraft updated with the latest and most advanced technology and capable of meeting or exceeding the Air Force's needs for transport of fuel, cargo, passengers and patients. It includes state-of-the-art systems to meet the demanding mission requirements of the future, including a digital flight deck featuring Boeing 787 Dreamliner electronic displays and a flight control design philosophy that places aircrews in command rather than allowing computer software to limit combat maneuverability. The NewGen Tanker also features an advanced KC-10 boom with an expanded refueling envelope, increased fuel offload rate and fly-by-wire control system.
 
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