Issue 55 – June 9, 2009

In this issue of the EADS North America Tanker Activity Update:

•	Up in the air on refueling; U.S. needs to modernize aging aerial tanker fleet

The following commentary by Congressmen Jo Bonner and Artur Davis was published in the June 2 edition of The Washington Times:

The Air Force is moving forward with yet another Request for Proposal (RFP) to replace the ever-aging KC-135 aerial refueling tanker.

The Pentagon has been in the process of replacing the tanker since 2001. These aircraft are 50 years old on average and are showing the strain of their age. Defense Secretary Robert M. Gates has declared it a strategic priority to modernize these tankers for a new century's threats.

Yet, eight years later, a new tanker has not been built, and the acquisition process is mired in Washington politics. Our potential adversaries are watching while we debate and delay. As members of Congress and advocates for the war fighter, we would like to offer some thoughts from this side of the Potomac River.

• Build on the original RFP that worked. Build on RFP that was issued Jan. 30, 2007, after being thoroughly vetted through three publicly issued drafts. The 150-person Department of Defense (DoD) source selection team invested tens of thousands of hours in crafting that RFP and understanding the competitor's proposals. Don't throw away its work.

The Government Accountability Office found a grand total of eight discrepancies in the handling of that RFP out of the 111 complaints in the Boeing Co.'s protest. Rather than begin anew, the Air Force should tweak the RFP to address those eight GAO issues, and then we should move forward with the source selection.

To go back to square one to create a new RFP would add years - and millions of additional dollars - to the process. Nothing in the GAO findings demands a restart from scratch.

• Keep the playing field level. If the RFP is slanted to predetermine a winner, there will not be a meaningful competition. Without a real competition, we risk repeating the one-sided KC-767 lease deal. Boeing is a proud company with a distinguished tradition, but the record of that deal is replete with proven corruption and excessive costs.

This lesson is unmistakable: Rigorous competition yields better deals for the taxpayer and provides more capability for the war fighter. A multibillion-dollar contract deserves more than a sole source.

• Shoot down any low-cost shootout plans that may be under consideration. This approach, even under DoD regulations, clearly is not appropriate for a procurement of this size and complexity. The contest between Northrop Grumman Corp./EADS North America and Boeing pits the derivatives of two commercial aircraft with different inherent capabilities against each other. The best plane for the mission should win this contest.

The war fighter has said "more is better" in the capability to offload fuel at range, to deliver cargo, to carry passengers and to evacuate casualties. Those additional capabilities must be considered as trade-offs with cost to determine which aircraft represents the best overall value.

• The Northrop Grumman bid means nearly 50,000 American jobs in 50 states. With the severe economic recession, there are understandable concerns that building a new tanker should mean American jobs. It is false to claim that only one of the competitors meets this goal. The fact is that the Northrop Grumman/EADS aircraft will be built in the United States, by Americans, under the terms of the Buy America Act.

Some Boeing partisans have argued that the presence of a foreign partner, EADS, should be disqualifying - a curious sentiment for a company that has a far-flung network of foreign subsidiaries and suppliers. In fact, our country benefits from the global nature of defense and aerospace - an environment, by the way, in which Europe spends $4 to $6 in defense dollars in the United States for every $1 we spend in Europe. U.S. defense and aerospace firms would be the big losers if there were a protectionist retreat from the global defense industry.

• Finally, be open to compromise on the prospect of a dual award. DoD has asserted that awarding two contracts would cost significantly more money than a single award. However, a number of credible independent voices who have no stake in this debate counter that assertion.

A number of authorities, including Rep. John P. Murtha, chairman of the House Appropriations defense subcommittee, and Rep. Neil Abercrombie, chairman of the House Armed Services subcommittee on air and land forces, think that doubling production through dual contract awards can actually save the Pentagon money by triggering continuous competition and allowing for more rapid retirement of aging KC-135s. A dual contract may well be the only way to break the political impasse and avoid another lengthy round of protests.

In closing, we urge DoD to move forward on this program with all due speed, taking these recommendations into consideration. The men and women of our military are depending on solutions, not politics. The same can be said for our nation, which awaits results.

- Rep. Jo Bonner is an Alabama Republican. Rep. Artur Davis is an Alabama Democrat

Contact:
Guy Hicks
Vice President – Communications and Public Relations
EADS North America
Tel: 703 236-3300
e-mail: guy.hicks@eads-na.com