The sad shape of US military contracting.

[Dinner]

Originally posted by BeBro
On the plus side I read somewhere Boeing wants to develop a cargo zeppelin now

http://online.wsj.com/article/SB121556261301737667.html?mod=googlenews_wsj

[Lonestar]

Originally posted by Oerdin


They never built a tanker before but Northrop is at least an aircraft manufacturer. Where as with that cargo plane deal you mentioned earlier neither of the bidders had ever actually made an airplane before and instead they were just reselling someone else's plane and putting different avionics or what not on it. It seems like it would be cheaper to just cut out the middle man and buy it direct from the manufacturer.

It was the only option, really. The "short" C-130 Lockheed proposed was excluded due to it having 4 engines...Army pilots are not permitted flying aircraft with 4 engines.

The middleman is a result of a need to spread as many jobs as possible in as many congressional districts as possible.

The Northrop-Airbus deal was much more direct. Northrop is to use its US factory to build an Airbus plane. Basically, Airbus has the plane but no domestic manufacturing plant while Northrop has the plant but no plane.

Northrup did not have the plant. Northrup built the plant specifically for this contract.

[Dinner]

Any time the politicians get involved things will be complicated. I can't help but feel having to manufacturers competing for Air Force large aircraft deals is in the long term interests of the Air Force compared to the current state of affairs where Boeing is pretty much the only supplier.

[Dinner]

NPR interview with Northrop CEO about the contract: http://www.npr.org/templates/story/s...oryId=89266045

[Asher]

That's just one side of the story, of course. I'm sure you knew that. It's also old, from April 1st.

[Dinner]

Originally posted by Lonestar

Northrup did not have the plant. Northrup built the plant specifically for this contract.

OK, didn't know that. I thought Northrop was using one of their existing plants.

[Asher]

Northrop built the plant there to manipulate the politicians there to play dirty.

[Dinner]

Pentagon to reopen tanker contract won by Northrop and EADS
By Leslie Wayne
Published: July 9, 2008

WASHINGTON: The Air Force will reopen the bidding for a multibillion-dollar contract for midair refueling tankers, the defense secretary, Robert Gates, announced on Wednesday.

The decision comes in the wake of a report by the Government Accountability Office that found flaws in the process that initially awarded the contract to a partnership of Northrop Grumman and the European parent of Airbus over a competing bid by Boeing, which filed a protest.

The action reignites the controversy surrounding the largest trans-Atlantic military contract. The Pentagon's decision will also enter the realm of presidential politics because John McCain, the presumptive Republican nominee, had long been a critic of Boeing's initial bid and as a member of the Senate Armed Services Committee held a series of hearings that opened the door to the bid made by Northrop and European Aeronautic Defense and Space.

As a result, critics have contended that he has favored a European supplier to an American company for a critical American military contract — an impression not helped by the fact that several of his top campaign advisers had worked as lobbyists for Airbus.

In strictly business terms, with the $35 billion contract having the potential to grow to more than $100 billion, both the Northrop-EADS partnership and Boeing led prominent campaigns on both sides of the Atlantic to land the business. Both European and American politicians entered the fray with statements supporting their own side as part of an intense public relations effort.

When the Air Force decided to award the refueling contract to the Northrop-EADS team, the selection stunned the global military community and was taken as a sign that the Pentagon was, at long last, opening its doors to European suppliers. These companies had long complained that they had been shut out of American military business, even though their countries had long purchased American military goods.

The decision also ended long decades of a close relationship between the Air Force and Boeing, which had made Boeing one of the Pentagon's biggest suppliers.

As soon as the contract decision was announced, Boeing filed its protest and, in an equally dramatic turn of events, the Government Accountability Office upheld the Boeing protest and started the process that led to the reopening of the contract.

The contract itself would provide for 179 aerial refueling tankers that would replace the current Air Force fleet, which dates date back to the Eisenhower era. Both Boeing, whose tankers are based on its 767, and EADS, which uses a variation of the Airbus A330 for the tanker, have competed head-to-head in countries around the world for tanker contracts. But, none of these contracts are as large as the Air Force proposal.

With national pride and jobs on the line, the tanker deal has stirred up strong emotions on both sides of the Atlantic. When the Northrop-EADS team was chosen, there was elation in Europe. This was only followed by disappointment when the G.A.O.'s surprise ruling criticized the process that selected the Airbus plane and opened the door to the rebidding of the contract.

"EADs feels very raw over this," said Alexandra Ashbourne, who heads Ashbourne Strategic Consulting in London, an aerospace analysis firm. "There was a lot of effort expended for no return. You cannot underestimate how raw and burnt they feel as a result of all this."

Loren Thompson, a military analyst at the Lexington Institute, a Washington policy research group, said that the fact that the announcement is coming from the defense secretary and not from the Air Force is a sign that the Pentagon wants to move quickly to get the contract signed.

"I think they want to get this award wrapped up by the end of the Bush administration," Thompson said. "If they do so, it would set a new land speed record for Pentagon contracts."

Complicating matters are internal matters within the Air Force. Gates had ousted the Air Force's two top officials over a series of securities breaches. The episode raised serious questions over Air Force management as well as over its ability to manage its massive weapons-buying budget.
One of those ousted, Michael Wynne, the Air Force secretary, added more fuel to the controversy as he departed. In a news conference with reporters, he said he was surprised and disappointed by the G.A.O. ruling that overturned the Air Force decision and said the report had been unclear and overly subjective.

http://www.iht.com/articles/2008/07/09/business/9tanker1.php

[Dinner]

Originally posted by Mr Snuggles
Northrop built the plant there to manipulate the politicians there to play dirty.

Of that I have no doubt. In the defense manufacturing game the object has always been to spread the jobs around as many Congressional districts as possible so you have the highest number of Congressmen supporting your contract. It's political crap which no doubt increases costs.

[Asher]

The thing I take away from this is the GAO actually did something useful.

[Lonestar]

Originally posted by Oerdin


OK, didn't know that. I thought Northrop was using one of their existing plants.

Believe it or not, Northrup doesn't have any manned aircraft fabrication plants up and running.

[Victor Galis]

Meh, this has Bush admininstration interference written all over it.

[Lonestar]

The Dems are claiming that Boeing's original bid was sabotaged by the Republicans, so...who's interference for what now?

[Dinner]

I have no doubt both parties are claiming all sorts of crap. McCain did get pretty pushy about Northrop-Airbus (McCain recieved lots of lobbyist money from those companies) but then again the Democratic Congressmen from Washington state were doing exactly the same for Boeing for exactly the same reason (I.E. campaign donations).

The reality is none of them are honest and they all will say what ever they're paid to say. My take is I want the government to spend less and get the cheaper planes and I want to see a monopoly subjected to at least some level of competition.

Oh, and I don't believe Boeing's claims that they'll be cheaper over the long run. Boeing, like all the other defense contractors, always promise the moon and the stars and roses out of their asses and none of it ever comes true. They all low ball their bids then milk the cost over runs for every penny.

[Asher]

Oh, and I don't believe Boeing's claims that they'll be cheaper over the long run. Boeing, like all the other defense contractors, always promise the moon and the stars and roses out of their asses and none of it ever comes true. They all low ball their bids then milk the cost over runs for every penny.

And so does Airbus.

SUPPLIES!@!!!