Air Force Official Looks To '09 Tanker Bid

Team Infidel

Forum Spin Doctor
Seattle Post-Intelligencer
September 16, 2008
'New approach' needed, acting secretary says
By Stephen Manning, Associated Press
WASHINGTON -- Acting Air Force Secretary Michael Donley said Monday that the latest failed attempt to award a $35 billion aerial refueling plane contract was "a missed opportunity" that leaves the military with an unclear path on how to replace its aging fleet of tankers.
Speaking at the Air Force Association's annual conference, Donley said a decision by Defense Secretary Robert Gates to postpone the latest round of bidding on the contract means the service "needs a new approach" when it tries again next year to pick a defense contractor to build 179 new tankers.
"None of us can yet answer the question, 'Where do we go from here?' " Donley told the audience of mostly Air Force personnel and defense contractors. "This experience has not been a healthy one for the Air Force, or for the (Department of Defense) or for the contractors or for our working relationship with each other or Congress."
Gates last week canceled bidding between The Boeing Co. and Northrop Grumman Corp., calling for a "cooling off" period. Gates said it would be impossible to award the contract by the end of the year as planned.
It was the latest delay in seven years of trying to find a contractor to build the jets that can refuel planes in flight. The Air Force says there is a pressing need for the planes, because some of the service's current tankers are nearly 50 years old.
The Air Force awarded the contract to the team of Northrop and Airbus parent European Aeronautic Defense and Space Co. earlier this year, but the bidding was reopened after the Government Accountability Office found fault with the Air Force's methodology.
Boeing claimed the latest round still favored the larger plane put forth by the Northrop team and threatened to back out of the process. Facing the prospect of just one bidder and heavy pressure from Boeing and its backers in Congress, the Pentagon decided to delay a decision until after the next president takes office in January.
Gen. Norton Schwartz, Air Force chief of staff, said Monday that awarding a new contract could take anywhere from eight months to four years. But he said the program would continue despite its woes.
"It's not dead," Schwartz said.
Donley said he agreed with Gates that a cooling-off period was needed in the struggle between Northrop and Boeing.
But he said the service needs to reconsider its acquisition process in general to make it capable of handling often-complex technological programs and to fend off the growing number of protests filed by the losers of contract awards.
The Air Force is conducting two reviews of its acquisition programs, one internal, the other an independent assessment.
Donley said the service is trying to determine what lessons it can learn from the ongoing problems with the tanker contract.
 
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