Team Infidel
Forum Spin Doctor
Wall Street Journal
June 7, 2008
Pg. 3
By August Cole
The forced resignation of the Air Force's two top leaders will likely lead to a fresh round of fighting over some big-ticket programs while slowing down the pace of new-contract awards until after the presidential election.
Within hours of the announcement that Air Force Secretary Michael Wynne and Chief of Staff Gen. Michael Moseley were being asked to resign Thursday, combatants on both sides of a $40 billion contract to replace the Air Force's fleet of aerial-refueling tankers began to assess how the personnel moves might affect the dispute.
Boeing Co. in March filed an official protest after the Air Force awarded the high-profile contract to Northrop Grumman Corp. and European Aeronautic Defence & Space Co. to build 179 Airbus jets, alleging that Air Force officials ignored their own bid requirements in choosing the larger Airbus jets.
Sen. Patty Murray (D., Wash.) one of Boeing's strongest supporters, said the departures of Mr. Wynne and Gen. Moseley raise "red flags about procurement and oversight within the Air Force." Although the two weren't directly in charge of selecting weapons systems, they were the voice of the Air Force before Congress.
Over the past few years, beginning with a scandal that erupted over an initial effort to give Chicago-based Boeing a $23 billion contract without seeking competitive bids, the Air Force's credibility has been tested several times.
In 2006, Boeing won a $10 billion contract to build rescue helicopters for the Air Force. Lockheed Martin Corp. and United Technologies Corp.'s Sikorsky unit successfully protested the award, forcing the Air Force to seek new bids. A decision is expected in October, but another delay is possible, particularly with the shake-up.
The next key step in the tanker drama will likely occur when the Government Accountability Office issues its ruling in the matter. That decision, expected by June 19, could prove to be pivotal, especially if the GAO rules in favor of Boeing.
In a research note to clients on Friday, Morgan Stanley aerospace and defense analyst Heidi Wood wrote that the departures of the two leaders, who strongly defended a recent string of contract decisions, "casts a pall on the credibility of prior decisions."
A spokesman for Los Angeles-based Northrop Grumman said the company doesn't believe the departures will affect the tanker issue. A Boeing spokesman declined to comment on the resignations. An Air Force spokesman said the service intends to stand behind its previous decisions.
Mr. Wynne and Gen. Moseley also went against the Bush administration's wishes by campaigning to buy more of the Air Force's cutting-edge F-22 Raptors, a $143 million fighter made by Lockheed Martin. The Air Force wanted 381 jets, but production is set to start winding down in fiscal-year 2009, leaving the service well short of its goal.
Ultimately, Defense Secretary Robert Gates chose to let the next administration decide the matter, which led to tensions between the Air Force and the Pentagon's leaders.
June 7, 2008
Pg. 3
By August Cole
The forced resignation of the Air Force's two top leaders will likely lead to a fresh round of fighting over some big-ticket programs while slowing down the pace of new-contract awards until after the presidential election.
Within hours of the announcement that Air Force Secretary Michael Wynne and Chief of Staff Gen. Michael Moseley were being asked to resign Thursday, combatants on both sides of a $40 billion contract to replace the Air Force's fleet of aerial-refueling tankers began to assess how the personnel moves might affect the dispute.
Boeing Co. in March filed an official protest after the Air Force awarded the high-profile contract to Northrop Grumman Corp. and European Aeronautic Defence & Space Co. to build 179 Airbus jets, alleging that Air Force officials ignored their own bid requirements in choosing the larger Airbus jets.
Sen. Patty Murray (D., Wash.) one of Boeing's strongest supporters, said the departures of Mr. Wynne and Gen. Moseley raise "red flags about procurement and oversight within the Air Force." Although the two weren't directly in charge of selecting weapons systems, they were the voice of the Air Force before Congress.
Over the past few years, beginning with a scandal that erupted over an initial effort to give Chicago-based Boeing a $23 billion contract without seeking competitive bids, the Air Force's credibility has been tested several times.
In 2006, Boeing won a $10 billion contract to build rescue helicopters for the Air Force. Lockheed Martin Corp. and United Technologies Corp.'s Sikorsky unit successfully protested the award, forcing the Air Force to seek new bids. A decision is expected in October, but another delay is possible, particularly with the shake-up.
The next key step in the tanker drama will likely occur when the Government Accountability Office issues its ruling in the matter. That decision, expected by June 19, could prove to be pivotal, especially if the GAO rules in favor of Boeing.
In a research note to clients on Friday, Morgan Stanley aerospace and defense analyst Heidi Wood wrote that the departures of the two leaders, who strongly defended a recent string of contract decisions, "casts a pall on the credibility of prior decisions."
A spokesman for Los Angeles-based Northrop Grumman said the company doesn't believe the departures will affect the tanker issue. A Boeing spokesman declined to comment on the resignations. An Air Force spokesman said the service intends to stand behind its previous decisions.
Mr. Wynne and Gen. Moseley also went against the Bush administration's wishes by campaigning to buy more of the Air Force's cutting-edge F-22 Raptors, a $143 million fighter made by Lockheed Martin. The Air Force wanted 381 jets, but production is set to start winding down in fiscal-year 2009, leaving the service well short of its goal.
Ultimately, Defense Secretary Robert Gates chose to let the next administration decide the matter, which led to tensions between the Air Force and the Pentagon's leaders.