Saturday, March 01, 2008

Boeing Tanker Deal Tanked - UPDATED

[Major news out of Washington on Wednesday. Scroll down for the update.]

Official Woundup Step-Dad ZeeMeister® emails:

Help me out, please.....the Pentagon should be looking for a proven vehicle, capable of landing on existing runways, that offers reduced operating cost to replace its aging tanker fleet, and it wouldn't be a bad thing if it were made in the USA, either.

So they give the contract to Northrup for a bunch of fuel-hogging A330's that will demand expensive strengthened runways, and be built everywhere but here? I can't see one plus in the whole basket, unles we want to talk about some streamlining in the cockpit.....oh yeah, that'll make the pilots happy!

There's gotta be something I'm missing does this happen? Is there a pony here, or does this whole thing smell like it looks?
All too true, I'm afraid. But there are reasons, and I'm sure none of them are lost on Boeing.

While it is true that the proposed vehicle — a variant of the successful 767 — is proven, the A330 isn't all as bad as its press. Airbus doesn't build bad products, really; they're just more arrogant about it than Boeing. (This is an arguable point of course, since anywhere outside of the United States and for nearly half of our own citizenry, it is always presumed that the United States is more arrogant. Else we cannot be enablers of the tremendous victim culture here and in Europe.) Yes, some runways might require some strengthening; but that was because of Airbus's ginormous A380 double-decker monstrosity. The A330 is a peanut compared to that particular behemoth. Also, I have spoken with pilots, including a member of my old ward in Moorpark, who really like Airbus planes. They like the simplified flight deck, and their flight decks are similar between all their models. This means an overall smaller learning curve from one model to another for Airbus-qualified jockeys.

(Of course, since these planes are targeted for military use, it's more likely that their flight decks will be stripped down of anything convenient, and loaded up with enough avionics to make any engineer froth at the mouth. That's the military way!)

Other commenters on other blogs have also pointed out that the Government rarely buys anything wholesale from any foreign supplier. What I mean by that is that there are always guarantees that a healthy percentage of parts and assembly will be based in the United States. That's why Northrup was the front-man for the project. Since they're the lead system integrator, they have to ensure that a percentage (not sure how large, but they advertise to the tune of 25,000 American "jobs") of that work remains in-house, so to speak. Not sure if final assembly will be in Toulouse or Alabama, but U.S. suppliers aren't going out of business any time soon.

No, the real problem for Boeing was the political climate, partly of their own making. Boeing's notorious ethical lapses up through 2001 cost the company dearly, and they're still paying for it in some ways. They've only just recently (a couple of years ago) been cleared for launching government-sponsored payloads on their rockets again, for example, after the illicit documents debacle with Lockheed. Then there was that nasty business with their then-CFO working with a Pentagon procurement officer and offering her a job while she was still in a position to influence buying decisions involving Boeing. That one involved jail time (apparently decisions were influenced) and ensured that employees of the company will have to take annual ethics training ad infinitum for the rest of their natural careers.

John McCain has been no friend of Boeing, either. He's been against this tanker deal from the beginning, and was one of the voices who insisted on re-competing the entire purchase. Now that he's running for president — and actually has a shot at it this time — the visibility of this project has been raised to uncomfortable political heights. The Pentagon, in particular, is becoming over-sensitive to any implied favoritism towards Boeing at this time, even though they've said over and over that Boeing appears to have effectively "cleaned its ethical house" and that they are glad to have them back in favor as a major defense supplier.

The fact that France is actively trying to improve relations with the U. S. also doesn't help Boeing. Although Airbus is a European conglomerate, it's main factories are in Toulouse and the company is constantly perceived as being French. Now that Sarkozy is trying to get comfy with Washington, it's entirely possible (even though the Pentagon will strenuously deny this) that some amount of diplomatic pressure was brought to bear on the decision.

I suspect that the Pentagon procurement types were keeping a wary eye on public opinion throughout the entire course of the re-competition. Especially in an election year, it does them no good to make anything like a controversial decision that will draw instant ire and wrath from all major candidates of either party. McCain would have screamed bloody murder if they'd chosen Boeing simply because he doesn't like the company. Obama and Clinton would prefer having the Europeans build the plane because it smacks of internationalism — the very sort of thing that John Kerry would have loved to see had he not torpedoed his own campaign four years ago. For Pentagon buyers, it was probably a no-brainer. The fact that a few legislators from Washington state are up in arms is meaningless; they haven't had the guts to defend Boeing in the past, and I see no reason to believe that this is anything but political grandstanding today.

Of course, there's always the old story that defense chiefs didn't even want new tankers to begin with. They were all for upgrading the existing fleet and using the savings to fund other projects. But that's life in the military. Sometimes the hand that feeds you slips you a mickey.

As for me: my new mantra is, "15 years to retirement... 15 years to retirement..." I kinda like how that sounds. Aerospace is for the birds.

UPDATE: So the protest worked for Boeing. Interesting in light of the fact that many, many pundits (even usually pro-Boeing writers) excoriated the company for daring to whine to the government about how the competition was handled by the Air Force. Turns out Boeing was right. The Air Force, perhaps for the very reasons outlined above (although this will never be known for certain) appears to have tipped the scales unfairly in Northup's direction during critical phases of the competition while sending Boeing down a couple of sizeable bunny trails. Naughty, naughty. Given the Air Force's recent blunders in their handling of nuclear materials, one wonders if firing a few department heads is really sufficient to help them pull their heads out of their assets.

(When Woody says "Air Force" in this context, Woody is really talking about department heads. Woody still has the utmost respect for rank and file wing-wipers who do their best to defend our interests throughout the world.)

One thing this protest is not: it is no guarantee that Boeing will yet win the competition. The Air Force has not yet said that they will accept the GAO's report, nor that it will re-compete the tanker procurement. Assuming they do, they still have to write up the specs (which could still easily be slanted in favor of the A330), and the entire process could still take a year or more to complete.

In the meantime, the military procurement types have taken what should have been a fairly straight-forward solicitation and turned it into an unqualified SNAFU. The wild blue yonder is looking a tad anaemic of late.

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