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    Sunday, November 16, 2008

    KC-45, ever going to happen?

    One thing I haven't touched on lately is defense issues.

    Of interest to me and something I think will tell us much about the Obama administration, is the still ongoing battle in the Air Force over the replacement for the KC-135/KC-10 tanking fleet.

    John McCain bragged about this during the election ("people are in jail because of me"). When the USAF originally tried to let this contract years ago, they did it as a single source bid (to Boeing) which led to the imprisonment of the AF's chief acquisition officer, Darleen Druyun. It's now a case study in corruption.

    A consortium led by Northrop-Grumman and including Airbus (based on their A-330), won the KC-45 tanker contract last year, but, immediately, Boeing cried foul, and the competition was essentially forced to another review. You can read some details of the review here.

    In my opinion, the outcome of this contract will tell us much about how the Obama administration is going to work. This contract is so politicized, that I do not find it likely that it will be let on the merits of the bids. If that happens, it will say something positive about the Obama DoD.

    The Boeing proponents forced this to be redone, because Boeing lost, and because the Chicago-headquartered Boeing was losing to a consortium with a large European component, and, final assembly was being proposed in a bright red state (Alabama) by Northrop.

    If we are to believe the article, DoD intends to request a best-and-final-offer from both competitors, where the cost will be decided based on a first article cost.

    Who wants to guess that Boeing will just squeak under the Northrop bid?

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