Tuesday, October 07, 2008

More Tanker Headaches

The Air Force's struggle to find a new tanker aircraft has attracted world-wide attention over the past couple of years. Currently, efforts to select a replacement for Eisenhower-era KC-135s are on hold, after Boeing successfully challenged a contract awarded to rival Northrop-Grumman.

With the battle spilling over into political circles, Defense Secretary Robert Gates elected to defer the decision to his successor. That means that USAF refueling units won't get new aircraft until at least 2013-2014, almost a decade behind the original schedule.

And, if that weren't bad enough, the Air Force is also caught in a bruising fight over who will provide depot-level maintenance for those aging KC-135s. As Aviation Week reports, the long-time contractor and subcontractor for the depot program are locked in a court battle, with clear implications for future tanker maintenance.

The twists and turns of this saga would give a lawyer a headache, but here's a quick synopsis:

Three years ago, Boeing (the prime contractor) and Alabama Aircraft Industries, Inc (the sub-contractor) agreed to bid together on the Air Force tanker depot maintenance contract, covering more than 40 aircraft a year. Depot work is roughly defined as the more detailed maintenance and airframe upgrades that can't be handled at the unit level, or at service-run logistics centers.

However, the service subsequently reduced the number of aircraft that would receive depot-level maintenance from outside firms, from 44 to 24. At that point, Boeing pulled out of its agreement with AAII. In response, the Alabama firm filed a protest, and submitted a bid on its own.

Flash forward to September 2007, when the Air Force gave the contract to Boeing. AAII filed another protest, which was partially upheld by the GAO. Boeing won again in a second round of bidding (concluded in March of this year), prompting AAII to seek legal relief. On 30 September, the U.S. Court of Federal Claims, ruling on a complaint filed by AAII, enjoined the Air Force from moving forward on the new contract.

For now, the two aerospace firms have agreed to keep working together, under the terms of the old contract. But, as Aviation Week observes, sorting out the KC-135 depot maintenance deal could take another two years. The legal wrangling also raises questions about long-term support for the KC-135, which will remain the backbone of our refueling fleet until those new tankers arrive in....er....you get the picture.

The Boeing/AAII battle is yet another reminder of the need for major reform in the defense contracting and procurement business. Corporate protests and political influence have, essentially, brought the Air Force tanker program to a halt, and the service's new combat search and rescue (CSAR) helicopter has been delayed by the same sort of tactics. Meanwhile, the tankers used to refuel other aircraft and our rescue choppers aren't getting any younger.

There has to be a better way. It's imperative that the next administration put acquisition and contracting reforms at the top of its DoD "to do" list.


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