Search Manufacturing.net
Today in Manufacturing.Net

Resources
Bookstore
Career Center
Events Calendar
Links
White Papers

Free White Papers

News
Featured Articles
Financial News
Global Manufacturing
Government News
Mergers & Acquisitions
News Archive
People in the News

Amazon

Market Sectors
Aerospace
Automotive/Transportation
Chemical/Petroleum
Food/Beverage
Medical
Metals
Pharmaceuticals/Biotech
Plastics/Rubber
Other Manufacturing

Industry Focus
Design & Development
Electrical & Electronics
Energy
Environmental
Facilities & Operations
Labor Relations
Manufacturing Technology
Materials
Quality
Safety
Supply Chain

Career Center
CareerBuilder.com


About Us
Editorial Contacts
Advertise with Us

Our Partner Sites
Chem.Info
ECN
Food Manufacturing
IMPO (Industrial Maintenance & Plant Operation)
Medical Design Technology
Pharmaceutical Processing
Product Design & Development
R & D Magazine
Wireless Design & Development
Wireless Week





Advertise with Mnet


Boeing: Air Force Rigged Rules To Favor Northrop/EADS
By Joelle Tessler, AP Business Writer
Manufacturing.Net - March 19, 2008

Printer Friendly     E-mail to a Colleague


WASHINGTON (AP) -- Boeing Co. said Air Force officials tilted the playing field in a $35 billion tanker contract competition toward Northrop Grumman Corp. and European Aeronautic Defence and Space Co.
 
In a formal protest of the contract made public on Tuesday, Boeing said the Air Force ''repeatedly made fundamental but often unstated changes to the bid requirements and evaluation process'' to keep the Northrop Grumman/EADS proposal alive.
 
The release of the executive summary of the protest is Boeing's latest public relations salvo in its attempt to overturn the Air Force award of the tanker deal to the Northrop/EADS team. Doing so won't be easy -- a fact Boeing acknowledged Tuesday.
 
Mark McGraw, manager of Boeing's tanker program, said reversing the Air Force's decision will be ''an uphill battle,'' but he's confident the company will prevail.
 
Last week, the Chicago-based company filed its protest with the Government Accountability Office, which has 100 days from the date of the filing to rule. In the protest, Boeing maintains that the Air Force review ''was not a fair and open competition, but a skewed process that unfairly compromised Boeing's proposal.''
 
Boeing has also turned to several of its existing lobbying firms, including Denny Miller Associates and Gephardt Group, to press its case. And on Monday, Boeing said its tanker could have saved $30 billion in fuel bills over 40 years.
 
Northrop Grumman, too, has gone on the offensive. Paul Meyer, manager of Northrop's refueling tanker program, said Tuesday he doesn't understand Boeing's claims since both companies had adequate opportunity to comment on and help shape several versions of the Air Force's request for proposal. He added that his competitor's attacks on the Air Force acquisition process come as a surprise.
 
On the lobbying front, Northrop has hired former Senators Trent Lott, R-Miss., and John Breaux, D-La. to keep the contract where the Air Force first put it on Feb. 29.
 
In a statement, the Air Force defended the tanker competition as transparent and fair, saying it provided both bidders with continuous feedback on the strengths and weaknesses of their proposals.
 
The surprise selection of Europe's EADS, parent of Boeing rival Airbus, and Los Angeles-based Northrop Grumman is major blow to Boeing. The company has supplied refueling tankers to the Air Force for nearly 50 years and was considered the heavy favorite to win the new contract to replace 179 planes. The deal is the first of three Air Force awards worth as much $100 billion to replace the entire fleet of nearly 600 tankers over the next 30 years.
 
Boeing's shares rose $1.04 to $76.53 Tuesday. And Northrop's shares were up 49 cents $79.79.
 
The tanker fight is tumbling through Capitol Hill, where lawmakers from Washington, Kansas and other states that would have gained jobs from a Boeing win are demanding the Air Force explain why it gave the deal to a foreign company.
 
The contract has even seeped into the presidential race. The presumptive Republican candidate, Sen. John McCain, played a key role in exposing a Boeing procurement scandal in 2003 that sent a top Air Force acquisition official to prison and led to the collapse of an earlier tanker contract.
 
McCain pressured the Air Force to open the new tanker contest to competition and to disregard concern over European Union subsidies to Airbus, which are at the heart of a U.S. Trade Representative complaint against the EU before the World Trade Organization.
 
That history is the backdrop of a key complaint in Boeing's protest -- namely that ''the process became driven by the Air Force's determination to create the possibility for competition between two planes that offered dramatically different capabilities.'' In its filing, Boeing said that pressure from Capitol Hill and the Northrop Grumman/EADS team ultimately led the Air Force to pick the larger plane offered by Northrop and EADS even though it had originally asked for a medium-sized tanker.
 
Air Force officials have said they choose the EADS/Northrop tanker, which is based on the Airbus 330 commercial plane, in large part because its size will enable it to carry more fuel, cargo and passengers.
 
But Boeing said the original request for proposal ''did not call for a jumbo-sized tanker.''
 
The company proposed a tanker based on its 767 commercial aircraft, but said it would have used a larger 777 platform if it had known the Air Force wanted a larger plane.
 
The protest also charges that the Air Force changed its requirements to accommodate the bigger tanker -- assuming maximum runway strength and ignoring estimates on tarmac sizes, for instance, to make it appear that more air bases would be able to handle the larger plane.
 
In addition, Boeing said it was unfairly penalized for not providing adequate commercial cost and pricing data for the underlying 767 plane even though the Air Force had told Boeing officials that it was satisfied with the data it had supplied.
 
And the company argued that the Air Force ignored Boeing's lengthy track record of producing aerial refueling tankers for the military and ''the inherent manufacturing genius of its bid.''

Printer Friendly     E-mail to a Colleague



Talkback!
Manufacturing.net is pleased to provide you an opportunity to share your opinions on any of the news stories or articles on our site. We reserve the right to edit/remove comments.
Viewing 6 User Comments
Add a Comment
Boeings complaint   3/19/2008 11:15:00 PM
Boeing is pathetic, they bid an old airframe and didn't win the competition and now they say "well if we had known we would have bid something else". They were certain that they would win and when they didn't they just couldn't handle it.
tanker   3/20/2008 9:33:00 AM
I can't believe our gov. would buy a forg. product for our mil. !!!!!!!!
Tanker Competition  3/20/2008 11:24:00 AM
The Europeans subsidize their manufacturers with taxes on their workers. And, our elected representatives send more billions of our tax dollars to support this unfair practice. The next time I go to vote I will vote against the incumbent, regardless of their party. Imagine the arrogance of these bureaucrats and politicians, ignoring the ailing Manufacturing sector at home.
Tanker Competition  3/22/2008 10:35:00 AM
Wake up and smell the coffee! Boeing has profited far more from US subsidies than Airbus. WTO has already found tax breaks for Boeing illegal. It's utter nonsense to claim that only Airbus has gotten help. If there ever was a big fat wellfare queen, it's Boeing. Objectively speaking NG proposal was better. The competition was based on merit and on merit KC-30 won. Hubris cost dearly for Boeing.
Tanker Competition  3/22/2008 4:47:00 PM
Boeing could have easily proposed both tanker configurations. They could have proposed the one they did along with a larger model. However, Boeing failed to bid the larger aircraft. As a consequence, AirBus/Northrop has won, and that's the end of it. Boeing will have to be a wiser bidder in the future, offerring more models if they want to win. Boeing could have offerred a larger aircraft, but they didn't. Hence they've lost. Next time they'll hopefully offer several sizes of aircraft at different cost structures, and possibly they'll win. In this case, they've lost as far as I see it. The competition was fair and Boeing failed to read the tea leaves correctly! They no longer have the unfair advantage of insider information, and that's the way it should be. There's just as much work for the U.S. with either contract. It's a world economy. The Air Force recognizes that fact. Boeing obviously does not although they outsource a major share of the aircraft they build to foreign countries. Time to wake up, Boeing and bid more varieties! Boeing gets "subsidized" just as much as the Europeans in ways too much to reveal here! Dave
Tanker Competition  3/25/2008 1:07:00 PM
Looking back one can see that Boeing was tainted by the old fixaroo when the government contracting officers' son in law was given a job at Boeing, the contracting officer "retired" and was given a job at Boeing and on and on. I do not believe that technical merit had much to do with the "anyone but Boeing" mind set of the new contracting officers. The original contracting officer is in a federal prison, the CEO of Boeing was fired, what else can happen to punish poor judgement. In global market parts for even things "Made in U.S.A." are not. Aviation quality parts will be made by the lowest cost producer who can meet the requirement.


Add a Comment...

E-Mail:
The content of this field is kept private and will not be shown publicly.

Subject:
Comment:

 

     

  
THIS WEEK'S MOST
READ NEWS ITEMS




Electrical & Electronics
Samsung Replaces CEO

HP Will Pay $13.2 Billion For EDS

Tyco Electronics Selling Unit To Cobham

AMD Executives Resign Amid Restructuring, Decline

Report: HP Close To $12B Deal For Electronic Data Systems


Government News
Spirit AeroSystems To Hire Over 1,000 At New Facility

R.I. Supreme Court Hears Lead Paint Case

Japanese Core Machinery Orders Decline In March

Strong German Growth Drives Euro Economy

Boeing Shuts Down Production Line Amid Investigation

Manufacturing Technology
Wal-Mart Details RFID Long-Term Plans

Manufacturing Technology Consumption Up 8 Percent In 2007

November Manufacturing Technology Consumption Slips

HDTV Makers Face Fierce Competition

Sony Bringing High-Quality Organic LED TV To U.S.
News Video