June 2008

Boeing refuses to move on … hearings begin in Congress

Boeing expected to win the competition for the new aerial refueling tankers, but it did not as the Pentagon decided Northup's product is superior.

The Boeing claim seems to stand on the jingoistic argument that "France" somehow won the contract for building an American military plane, that somehow the U.S. is turning over valuable jobs to "them dadgum furriners."

The Northrop Grumman KC-45A tanker program does not transfer any jobs from the
U.S. to France or any other foreign country. No sensitive military technology will export to Europe.

However, mainstream media jumped on "dang furriner" story because it is volatile, seductive, and attracted viewers. Boeing got a nice PR bump out of its campaign forcing more hearings by the government after the blustering and posturing of Boeing's people in Congress.

Boeing protested the Air Force decision vigorously in legal filings with the GAO and in newspaper advertisements. It argues the Air Force was inconsistent in the way it assessed the bids.

Reuters reported Loren Thompson, defense analyst with the private Lexington Institute, said the Air Force believed the GAO would find only minor problems with its handling of the competition, but no major issues that could lead it to sustain Boeing's protest.

"The Air Force's working assumption is that the GAO will find some problems, but they will be minor and not the sort of thing that would result in a recommendation to re-compete the contract," said Thompson, who has close ties to the Air Force.

Thompson said much of Boeing's protest was to justify the efforts of its backers on Capitol Hill, some of whom have vowed to reverse the Air Force's decision, even if the GAO upholds the contract award.

Meanwhile, the Senate Armed Services Committee approved $893.4 million in research and development funding for the Northrop tanker, which the Air Force has dubbed the KC-45A.