Friday, February 26, 2010

KC-X is ON















It's ON.





The great race for the next Air Force Arial Tanker Replacement Aircraft or KC-X is ON. The Final version of the RFP hit the street on Wednesday this last week and both competitors are busily pulping trees for the paper they will need for their submissions. The DOD claims they made hundreds of changes to appease the two suspected offers. Time will tell.

Both parties are claimed to be upset. The Northrop Grumman/EADS/Airbus complained earlier that the Draft RFP leaned towards a replacement of the KC-135 airframe which they feel reflects more the Boeing product not theirs. They had threatened to throw a temper tantrum and go off sulking on some corner sucking on their thumps. Collectively.

Meanwhile Boeing was laying down the crocodile tears and still moaning about the fact no one dared address the illegal subsidy issue that Airbus is guilty of. As determined by the WTO Airbus received 5 Billion dollars of illegal support from partner countries.

By all rights this should have been addressed in some kind of penalty on Airbus but the DOD/Air Force did not make any changes to accommodate the WTO finding. Maybe they think Boeing is guilty of the same thing however the business model and the funding sources for the 767 airframe (and most if not all of the Boeing commercial products) is not from the US Government or any government for that matter. That source is what is known as "venture capital" and is usually made up of private sources.

If you want to see how the European sausage is made simply look at how much over the barrel Airbus has their government partners on the A400M Transport aircraft. When they miscalculate or have problems and they run out of money they simply go back to the partner governments and get more money. No risk and all the reward. The WTO ruled that the A330 aircraft contains 5 billion dollars of extra aid that makes it less expensive than its competition.

So, standby to standby I will be watching if the NGS/EADS/Airbus actually puts in a proposal.

BT: Jimmy T sends.

Airbus/KC-45 (right face) stolen from:

Boeing KC-767 (left face) stolen from:

4 comments:

Buck said...

I thought about posting on this last Thursday, as the AFA's Daily Report was "all tanker, all the time." But you know we're just OBSESSED with hockey these days... ;-)

JimmyT said...

Buck, I am not sure how long the competitors get to write their proposals, I am figure something like 5 or 6 months on a contract this size so it will be some time before we see if NGS is bluffing. Lots of Labor issues popping up pushing for the NGS/Airbus side and the Split Tanker purchase, the worst of all worlds there.

I'll be watching.

BT: Jimmy T sends.

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IowaBill said...

Jimmy, it seems that if the US gov buys the Airbus model and it is true that the Euros are subsidizing it, perhaps Boeing loses a contract, but US taxpayers are getting a good deal at the expense of the Euro taxpayers. By subsidizing this, the Euro governments are making everything else more costly, same as when we apply tariffs on foreign sugar, which may benefit US sugar companies but hurts the rest of us in the grocery store. So as long as they don't cause Boeing to fail, why not encourage them to subsidize away & reap the benefit here?