Procurement of big ticket items
Follow up to the US military ‘procurement and research’ increases post:
$25 billion for the first new aircraft carrier, $9 billion for per for another one or two each.
Aircraft Builders Compete for Air Force Tanker Contract Again 24/7 Wall St.:
Maybe the third time will be the charm. Today marks the closing date for bids to build a new refueling tanker for the US Air Force. Boeing Co. (NYSE: BA) submitted its 8,000 page bid on the deadline day, following a submission yesterday from the European Aeronautic, Defence & Space Co., known as EADS and makers of the Airbus family of planes. The bid from EADS did not include participation by its former partner, Northrup Grumman Corp. (NYSE: NOC).
The Pentagon’s first try at getting a new tanker began in 2000 and the contract was awarded to Boeing in 2004. The $35 billion award would have replaced 179 Boeing 707-based tankers built from the original contract awarded during the Eisenhower administration. A bribery scandal involving Boeing executives resulted in cancellation of the contract and a new round of bidding.
The contract was re-awarded in 2008, this time to Northrup, which had partnered with EADS to build the planes at the European maker’s Alabama plant on a modified version of the Airbus 330 passenger plane. That contract too was cancelled when the Government Accountability Office found irregularities in the way the decision was made.
The bidding was opened again last year, with a decision now due in November. A third bid, from U.S. Aerospace Inc. (OTC: USAE) and Ukranian partner Antonov Co., is also expected today…
In my youth I was a logistics in several KC-135 units. I am older than the KC 135’s and I am not planning to retire soon!
I have kept close to my old work horse. The first tail numbers were contract year 1957 serial numbers, they were low rate production, delivery on that contract took place up to 1960. Later contracts mean deliveries ran through the mid 1960’s. The KC 135 was designed for the Air Force under contract to Boeing.
Boeing planned to sell it to the airlines as a 4 engine passenger jet, however, Douglas the DC 8 would had 6 seats in each row so the 707 is redesigned with a wider fuselage than KC 135 and has larger wing surface area for increased range at the weights.
The smaller KC-135 is structrually more durable (something the DoD never worries about now). The KC 135 was reengined with GE CFM 56 engines in the early to mid 1980’s. At this time structural changes were made to enhance performance with the stronger engines allowing greater off load to receivers and range.
Each 5 years or so heavy aircraft go into depot for a major corrosion inspection. At the end of the inspection the airplanbe is in near new condition and safe to fly for another 5 years. There is also the option to “reskin” the aircraft which adds a few weeks to the 5 year repair cycle and some cost. Reskin is needed if the airpalne is suspected of having “stress fatigue”. The average KC 135 is not near the flight hours/cycles where stress fatigue is an issue.
Even though the airplanes are long in the tooth, there is no correlation between calandar age and how many hours of flight or how many pressurization “cycles” the airplane can do.
The KC-135 has a lot of life remaining considering there are 707 aircraft with lesser durability flying in cargo service and a few militaries with far more usage than the KC-135.
As a logistician I suggest there are many years left in the KC, and replacing it is more for Boeing’s profit.
Another consideration is the mission of the KC 135. see next comment.
The KC 135 was designed to refuel the B-52 8 engine heavy bomber on its way to strategic missions where intercontinental range and large takeoff weight required the B-52 (buffpilot’s airpalne) be refueled enroute to the mission. In the Vietnam war some KC 135’s were taken off Strategic Air Command (SAC) alert and sent to Southeast Asia to refuel fighter bombers going in to combat. This was a new mission!
Somewhere along the line the C-5 was equipped with refueling recepticles so that the KC 135 could refuel it marginally extending its range.
Some time in the 1970’s the USAF acquired a couple of squadrons of KC-10, which were Douglas DC 10 passenger jets converted for refueling. Also the Marines converted a number of C-130 turbo prop cargo aircraft for refueling. Today there are a few F/A 18 aircraft which can refuel other F/A 18’s. There are a lot of refueling equipment to extend the range of fighters, bombers and cargo aircraft.
The KC 10 is an interesting concept, never proven, to have both a refueler and a cargo aircraft in the plan to deploy a fighter unit overseas. I am not sure of the economics or the need because the further you go over seas the harder it is to find fuel for either the fighters or the tankers. I am a logistician the absolutely most expensive thing to do is bring bulk things in to remote aresas with airplanes. And who pays if the enemy lays artillery on the airfield?
To say the least what is the value of high tech shock and awe where everything needs to be airlifted in?
I guess if the place is surrounded……………. I am glad I was not a logistician resupplying Dien Bien Phu.
The problem with the 2008 procurement which was successfully protested in the Boeing version the KC 767 (based on B 767) was somewhat larger and more off load than the KC 135, but the Air Force gave Airbus’ 25% larger submission with the impossible suggestion that it could be maintained for the same life cycle cost as the smaller KC 767.
It is a long established observation that weight and life cycle cost are positivel correlation.
There was something seriously wrong with the 2008 evaluation.
Maybe there is a misunderstanding about the need for the new air refueler?
Maybe they were selling a French jobs program?
Maybe the Air Force does not know what is needed or what could be justified to replace the KC 135.
The KC 135 does not need to be repaced. The missions are not important to the common defense.
I conclude the AF is more concerned with Airbus or Boeing profits than tankers.
More on the history of the acquisitions.
The USAF seems to have a forty year investment plan for airplanes: to keep the airplane industry “healthy”, to keep labor costs artificially high in US aerospace, and to run its fleet as a municiple bus fleet where age of an airplane is a meaningless measure of their excuse to spend the taxpayers’ dough for the plan to keep the industry profitable.
One decade the USAF is buying bombers, the last was the 1990’s the B-2 is an abject failure!! Now is the time to draw up plans for the 2030’s to be the decade of the bomber.
Another decade is the fighter, the oughties was that but all they got was a few F-22’s and a very late F-35 Lightning which is 76% over unit price estimates used to sell the plane to a willfully complicit congress
The 20 teens seems to be the decade of the Tanker. Seems to be off track but Robert Burns talked about plans of “mice and men”.
The 2030’s USAF will need huge money to replace the C-17, if it proves durable enough to last that long.
The first KC 767 contract was not the buying plan. In 2000 the USAF was going to rent 100 Boeing KC 767 tankers for ten years to get to the full purchase in 2011. It was a fully rational strategy, except it made no economic sense and denied Northrop Grumman a slice of the pie. So, McCain being concerned that Northrop was not on that gravy train throws a wrench in Boeing’s work with the USAF.
The USAF procurement offical’s issues most certainly were a scandal and mostly for the entire military industry complex revolving doorsand it was masked by the Mc Cain tanker dealings.
My opinion: it never makes sense to rent a system you suppose to use for the long term, but I was not commenting at the time.
The lease deal was stopped. Makes sense to me, but getting to rational decisions in the Beltway is not a usual condition.
The second “acquisition” was supposed to make Mc Cain happy, and it did. It bought the Airbus KC-45. An airplane which had never offloaded fuel, which is 25% larger and heavier than the KC 767 and which would be built in the USA like a Toyota car.
Trent Lott enjoyed Airbus, too, as it was going to have Northrop Build an assembly plant in Mobile, Alabama where now there is nothing about assembling aircraft. The major parts of the airplane would be assembled in Toulouse, near Marsailles, put on Northrop leased ships and sailed to Mobile to be put together by imported specialists.
While the KC 767 was prepared to fly fueling missions for the 2000 contract the Airbus had yet to fly a refueling mission.
The second acquisition was flawed. The USAF either had no clear set of requirements or failed to apply them to the selection of the Mc Cain/Lott entry.
The KC 767 is larger but essentially a replacement for the KC 135. The Airbus is so much larger than the KC 135 that it is a replacement for the KC-10.
Why the requirements for the second acquisition were changed without going through the usual DoD/Federal Acquisition Regulations review process for the specifciation change is why the GAO sustained Boeing’s protest. GAO would not have engaged in questioning the fiction that Airbus could be sustained for the same cost as the smaller airplane………………….
So, 8 years later…………….. The new tankers were cancelled for the protest.
The USAF had a plan, it was going to replace the KC135 and KC 10 in 2 or more separate acquisition actions, none seemingly followed. The first was a smaller refueling airplane like the KC 767 that would do most of the KC 135 missions. Then a KC 10 replacement was planned which would do the Dien Bien Phu thing and transport the Army around with the new 30 ton Futire Combat System tanks to places where it made no sense (the FCS was […]