http://www.komonews.com/news/26832099.html
Report: Boeing may not re-bid for tanker contract
AStory Published: Aug 11, 2008 at 8:30 AM PDT
Story Updated: Aug 11, 2008 at 8:36 AM PDT
By KOMO Staff & News Services
The Boeing Co. is strongly considering a "no bid" position for the next round of the U.S. Air Force refueling tanker competition, Aviation Week reported Monday.
Citing unnamed sources, the publication said on its web site that "multiple sources familiar with Boeing's internal discussions say company officials are strongly considering the option of not submitting a proposal as the company's Integrated Defense Systems sector tries to respond to the draft RFP within the government's speedy timeline."
Reached Monday morning, Boeing spokesman Dan Beck told KOMO News he could not comment on internal company discussions.
The Pentagon last week opened a second round of bidding for the $35 billion Air Force tanker contract following an error-plagued first attempt that featured bitter competition between Northrop Grumman and Boeing.
A revised draft request for proposals was issued to build 179 new aerial refueling tankers meant to replace the Air Force's current fleet that dates back to the 1950s.
The team of Northrop and Airbus parent European Aeronautic Defence and Space Co. won the original contract, but Boeing protested, saying the Air Force did not conduct the process fairly and favored Northrop. A Government Accountability Office review found "significant errors" in the Air Force's decision, and Defense Secretary Robert Gates later said he would reopen bidding.
The revamped competition will focus on areas where government auditors found problems with the initial process.
Northrop's version was larger than Boeing's, but the GAO concluded the Air Force unfairly gave Northrop extra credit and did not make it clear that size and the ability to carry more fuel would be a bonus.
Changes in the draft request for proposal make that clearer, saying "additional value" will be given to any proposal that can carry more fuel than required. It will also evaluate the cost of each program on the expectation that each plane will last 40 years, longer than the earlier proposed 25-year life cycle.
Shay Assad, the Pentagon's director of defense acquisition policy, said the new draft clarifies for the contractors how their bids will be reviewed. The revised document provides a "very clear and unambiguous insight into the relative order of importance and the technical factors we are going to evaluate," he said.
Boeing's allies on Capitol Hill, especially those who represent the company's industrial base in Washington state, were not pleased.
Sen. Patty Murray, D-Wash., said last week that the new draft still seems to favor Northrop's larger aircraft despite what she said were earlier assurances from the Air Force that a smaller, more agile plane was needed.
"The first indication is that they are just going to go back and rewrite the RFP (request for proposal) to favor the large plane they chose," she said.
Meanwhile, Sen. Maria Cantwell, D-Wash., said she is blocking Senate action on President Bush's nomination of Michael Donley to be Air Force secretary. Cantwell said she is not satisfied that Air Force and Pentagon leaders will conduct a fair rebid of the tanker contract. In a July 31 letter to Gates, Cantwell expressed concerned that he and other Pentagon leaders have not recognized the gravity of flaws in the tanker acquisition process.
Lawmakers from Alabama, where Northrop plans a new plant for the plane, applauded the Pentagon. Sen. Jeff Sessions, a Republican, said he would "continue to insist that this competition is conducted without political interference."
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