Opening another chapter in the contentious saga of the Air Force tanker contract, Boeing said it will formally protest today the Pentagon's...
WASHINGTON — Opening another chapter in the contentious saga of the Air Force tanker contract, Boeing said it will formally protest today the Pentagon’s decision to award the massive deal to its rivals Northrop Grumman and EADS, the European parent of Airbus.
It marks Boeing’s first protest of a U.S. government contract in 30 years.
“This is an extraordinary step rarely taken by our company, and one we take very seriously,” Chairman and CEO Jim McNerney said late Monday in a statement.
After Air Force officials explained in a lengthy Friday meeting why Boeing lost the $40 billion contest, the company remains convinced there were “serious flaws in the [procurement] process that we believe warrant appeal,” McNerney said, including “inconsistency in requirements, cost factors and treatment of our commercial data.”
Most Read Business Stories
- Boeing abandons its failed fuselage robots on the 777X, handing the job back to machinists WATCH
- Seattle-based Convoy, the ‘Uber for Trucking’ app, scores $400 million in new round of funding
- Inside the world's largest Starbucks, opening Friday in Chicago | Perspective VIEW
- Nike cuts ties with Amazon, but shoes won’t vanish from site
- Here's a $10,000 offer to leave the Bay Area
Boeing may give more specifics about its protest today.
Meanwhile, in a statement Monday it termed a “response to press reports” about Northrop’s superior bid, Boeing itemized where it had outscored its competitor. It said the Air Force had modified the parameters of its proposal request to allow a larger tanker and to keep Northrop/EADS in the competition.
“The ‘leveling’ of the competition and subjective assessments of the two proposals seems to have led the Air Force to select a larger, more expensive and operationally limited” plane, the statement said.
Boeing bid its 767, a smaller tanker than the Airbus 330, which has larger fuel and cargo capacity.
The contract, likely to be one of the largest from the Defense Department for the next decade, would enable the Air Force to replace 179 of its aging KC-135 refueling tankers. Follow-up contracts could make the deal worth $100 billion.
The protest is likely to be a protracted and expensive battle. Company executives including Vice President Mark McGraw, director of the company’s tanker program, spent most of three days locked in Boeing offices in Northern Virginia, debating the move.
McGraw and others on the Boeing team also were closeted with Rep. Norm Dicks, D-Bremerton, on Sunday.
Boeing has the Washington state delegation on its side, including senior members of the Senate and House Appropriations Committee, as well as Kansas’ representatives, because Wichita has a Boeing plant.
“I believe Boeing was misled” in the contract guidelines, Dicks said, adding that “Congress was misled by the Air Force” as well.
The Air Force changed the criteria to let Airbus compete, “but they didn’t tell anybody until they got caught,” Dicks said, noting documents that surfaced last week about alterations to the testing model.
Northrop was prepared for a protest and fired off a statement Monday morning calling the competition “the most rigorous, fair and transparent acquisition process in Defense Department history.”
Northrop also rejected the idea the Air Force had dictated the size of plane required: “Each contractor was free to propose the best solution and platform to meet Air Force warfighter requirements.”
In addition, Northrop nearly doubled its estimate of the jobs the tanker project will bring to the U.S., raising its figure to 48,000.
The company said the new, higher number was based on Labor Department statistics, not “conservative” calculations from the Commerce Department.
Claims by Boeing backers that thousands of jobs could be lost to a foreign company while the U.S. faces a recession have led to a backlash among many Democrats and Republicans in Congress during this political season.
Boeing spokesmen said Monday that the Air Force had scored Boeing high in the “Mission Capability” section of the contract.
Boeing’s Bill Barksdale said this was “the highest possible rating in the most critical factor” in the competition.
However, Mike Wynne, secretary of the Air Force, told Congress last week that the Northrop-Airbus aircraft was “clearly a better performer.”
Dicks disagreed, citing Wynne’s earlier testimony to the House Appropriations Defense Committee, in which he said the Pentagon’s priority was a medium-sized tanker.
Wynne and other Air Force officials will testify before Dicks’ panel in a public hearing this morning and in a closed meeting with the committee in the afternoon.
Alicia Mundy: 202-662-7457 or firstname.lastname@example.org