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Boeing Airs Beef over Tanker Deal Save Email Print
Posted: 9:05 PM Mar 26, 2008
Last Updated: 9:08 PM Mar 26, 2008
Reporter: 13 News

A | A | A

Boeing has taken to the media to air its protests over a lost tanker deal.

The company took out full page ads in newspapers across the country, including the Kansas City Star. It spells out why it believes the Air Force decision to award a $35 billion contract to Northrop Grumman and its European partner Airbus was unfair.

The ad says the selection process was flawed and selection criteria were misapplied.

Northrop Grumman fired back with a release of its own, saying, "Boeing lost this competition fair and square and is now twisting the facts attacking the United States Air Force and engaging in a desperate attempt to reverse the award to Northrop Grumman."

The tanker deal could have meant hundreds of jobs for Boeing in Wichita. The Kansas and Washington state Congressional delegations have called for investigations into the awards process. State lawmakers are also questioning the deal.

Click here for complete text of Boeing's ad.

Complete text of Northrop Grumman's response:
Setting The Record Straight About Northrop Grumman's Winning Bid

Northrop Grumman won the U.S. Air Force contract to build America's next generation of aerial refueling tankers, a triumph Boeing obviously cannot accept. Even though the U.S. Air Force determined that Northrop Grumman offered the superior product, rated better than Boeing in four of five evaluation criteria and has already built, flown and tested a tanker, Boeing manages to overlook those facts and instead has launched a misinformation campaign aimed at persuading members of Congress to intervene and thwart the deal.

The latest outrage from Boeing comes today in the form of a full-page
advertisement in newspapers across the country. Boeing lost this
competition fair and square and is now twisting the facts, attacking the
United States Air Force and engaging in a desperate attempt to reverse the award to Northrop Grumman. In this space, we set the record straight on Boeing's baseless charges and numerous factual errors.

Allegation: Boeing alleges the bidding process was "flawed," and that
"fundamental but often unstated changes were made to the bid requirements and evaluation criteria" in a way that "unfairly skewed the results against Boeing."

FACT: Even Boeing found the bidding process fair while it was going on - Mark McGraw, the head of Boeing's tanker program, said in April, 2007: "On this particular competition, we continue to have confidence that the Air Force is going to continue running a fair and open competition. The bidding and award process was, in the words of the chief procurement officer for the Air Force, "incredibly open and transparent and rigorous." Air Force officials also stressed that both Northrop Grumman and Boeing were constantly kept up to date on what the Air Force was looking for in a tanker and what its selection criteria were. Boeing had the opportunity to protest the selection process before the decision was made, but didn't - they were for the competition until they were against it. What's more, several independent, outside organizations, including the Congressional
Research Service, examined the bidding process and found no problems or conflicts.

Allegation: Northrop Grumman's win "penalized the warfighter and the
taxpayer...."
FACT: In documents describing why Northrop Grumman won, the Air Force found that Northrop Grumman's "superior air refueling capability enables it to excute" its various missions "with 22 fewer aircraft
than...Boeing...." The Air Force concluded that Northrop Grumman provided "an efficiency of significant value to the Government."

Allegation: Boeing claims it was misled by the Air Force into believing
its proposed aircraft - smaller than Northrop Grumman's winning KC-45A - was what the Air Force was looking for.
FACT: Again, the Air Force made clear to each company its selection
criteria, and neither company complained about the criteria or selection
process during the proposal process. The Air Force Request For Proposal made no specific reference to aircraft size; instead, it asked only that the biddors supply a plane that met or exceeded the pre-established criteria. The Air Force concluded Northrop Grumman's plane was the better pick because it was more versatile than Boeing's.

Allegation: Boeing alleges "the Air Force and taxpayers will pay billions
more for the Northrop Grumman" aircraft.
FACT: As the Air Force made clear in announcing Northrop Grumman's win, Northrop Grumman offered an aircraft that could do more, for less cost, than Boeing.

Allegation: Boeing alleges that in the Air Force's evaluating past
performance, Boeing and Northrop Grumman received equal and satisfactory ratings.
FACT: The Air Force made clear that concerns about Boeing's program
management, related to its production of military aircraft for Italy and
Japan, contributed to the Air Force decision that Boeing's bid carried
higher risk than Northrop Grumman's.

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Posted by: Ivan Location: England on Apr 15, 2008 at 09:12 AM
The USAF followed its “Bigger is Better” philosophy with the selection of the EADS/NG A330 for the KC-45A tanker. The GAO upheld two protests of the USAF CSAR-X contract (to Boeing) on the grounds that the USAF changed/modified certain “Key Performance Parameters.” It seems that the USAF not only changed/modified the Key Performance Parameters (again) from its original request, but altered Boeing's bid by adding $5 Billion to the cost/price estimate and adjusted the 767 delivery timeline to favor the A300. The USAF decided that Boeing's 767 production line running at 25% capacity could "only deliver 19 tanker by 2013", while NG/EADS could deliver 49 from a factory in Alabama that has not been built. The GAO should uphold the Boeing protest.

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