Building wings for US Air Force – in Wales
April 19, 2008 1:40 pm featuresColby Adams reports on Boeing’s battle for a lucrative American military contract, the British jobs at stake – and why the state of Alabama seems on our side
IT TOOK more than five years of planning and millions of dollars spent to pull off a major coup. However, in retrospect, it was never going to be easy.
In late February, the European Aeronautic Defence and Space Company and North American Northrop-Grumman finally secured a $35 billion contract over heavy favourites Boeing to replace the United States Air Force’s ageing tanker fleet with 179 new refuelling aircraft.
Their victory could provide a significant boost to Britain’s manufacturing base, because the wings for the EADS plane – a variation of a previous Airbus design – are to be manufactured at existing plants in Filton, near Bristol, and Broughton, north Wales. The contract will inject £3 billion into the United Kingdom economy while supporting nearly 13,000 British jobs, according to the Society for British Aerospace Companies. The wings will then be shipped to a final assembly plant that Northrop says it will build in Mobile, Alabama.
The Northrop-EADS tanker will have a British content of around 20 per cent.
Yet Chicago-based Boeing – the loser in the tanker bid battle – would prefer those wings to be built at its Everett factory in Washington state. The company filed a formal protest against the US Air Force’s decision on March 11. Now Northrop-EADS must await the results of a congressional inquiry into the contract – a review that will directly affect 13,000 British manufacturing jobs when it is completed by mid-June.
The US Air Force and its successful bidder filed separate motions to dismiss Boeing’s claims, but the Government Accountability Office – a congressional investigation agency – rejected both of those motions in an April 3 hearing. It issued a stop-work order on construction of the Northrop assembly plant in Mobile and will now examine the contract in light of Boeing’s accusations the Air Force used unfair standards in choosing EADS’s larger aircraft over Boeing’s own proposal, the KC-767.
In questioning the circumstances that led to the Air Force’s decision, Boeing leaders pointed to what they labelled numerous irregularities in the selection process. In particular, they complained Northrop was rewarded for providing features in its design not specifically mentioned as necessary by Air Force procurement officials in the initial request for proposals.
‘The fact that the Air Force gave Boeing the highest possible rating in mission capability and cited the KC-767 Advanced Tanker as having three times more strengths than the Northrop-EADS tanker further highlights the inconsistencies in the selection process’, said Mark McGraw, Boeing’s tanker programme manager.
He also criticised what he called a “lack of feedback’” during the submission phase, as well as a “significant levelling of [Northrop’s projected] costs at the 11th hour”.
Northrop spokesman Randy Belote defended the military’s decision. “The fact that Boeing officials are suggesting that the Air Force entered into some sort of criminality with the scales and the numbers is outrageous”, he said.
Following the February 29 Air Force announcement that it had selected Northrop Grumman to build and deliver the new fleet, supporters of the losing bidder spread misinformation about the basis for the Air Force’s decision, he alleged.
Awarding the largest defence contract in recent US history to a team that includes foreign manufacturers always promised to ruffle feathers inside the US government.
But the contract has forged some unlikely alliances. Among Northrop’s strongest supporters in Congress, Alabama lawmaker Jo Bonner has defended the Air Force’s decision with effusive praise. It emerges that Britain and Europe have more in common with Alabama than previously thought:
“After the most rigorous, fair and transparent acquisition process in the history of the US Department of Defence, the Air Force made what it determined to be the best choice for the warfighter”, Bonner enthused on March 13.
Northrop has said the plant will create at least 1,500 new jobs in Mobile.
The ultimate course of the tanker contract may even influence the presidential election, especially in terms of talking points in the debates.
Although most Britons lean to the left of Americans, it was Senator John McCain, the Republican presidential nominee, whose investigation killed the original contract awarded to Boeing in 2001. McCain’s inquiry led to the resignation in 2003 of Boeing chief executive Phil Condit and the conviction on corruption charges of Pentagon weapons buyer Darleen Druyun, who admitted to illegally assisting Boeing in securing billions of dollars worth of defence contracts, including the tanker deal.
For his part, Illinois Senator and Democratic presidential candidate Barack Obama has voiced moderate concerns over the Air Force’s decision to award the contract to a consortium that includes European companies instead of to Chicago-based Boeing.
While campaigning in Pennsylvania, he said: “I don’t mind the Pentagon procuring from other countries, but when you’ve got such an enormous contract for such a vital piece of our US military arsenal, it strikes me that we should have identified a US company that could do it.”
Obama’s condemnation wasn’t strong enough for the local branch of the Machinists Union in Everett, Washington, where Boeing would have built the tankers’ wings. Its members have endorsed Hillary Clinton.
“Maybe Senator Obama doesn’t mind the Pentagon procuring from other countries, but I sure as hell do”, union president Tom Buffenbarger told the Everett Herald.
Colby Adams is a senior defence researcher for Foresight News USA
Matt Eisler - williamsburg :
Date: April 20, 2008 @ 5:52 am
It is a shame that the entire A330 is not built within the UK. If that were the case, the US Congress would have a much harder row to hoe in fighting the award.
Unfortunately, the main design and manufacturing facilities are in France and Airbus is run like a French company and a set of wings from our staunchest ally will not keep the xenophobia at bay over here.
All politicians need to do is point to the French connection and the deal is doomed in the public eye, giving Congress the impetus to stop funding should the GAO review uphold the USAF choice.
World press reports notwithstanding, the US GAO is a non-partisan entity and truthfully more apolitical than any DoD procurement committee could ever be.
The GAO can be counted on to review the tanker deal fairly. The current body of Congress however will not rest until the ‘home team’ gets the prize. Apologies to our British cousins!
Hardy UK :
Date: April 20, 2008 @ 5:33 pm
Matt seems to have a clearly defined thinking toward this contract. However what appears to be a majority opinion on sourcing products in this case from France, is born out of ingorance.
The somewhat blinkered US attitude to sourcing in this case not French but a European product & one based on patriotic hand on heart star spangled banner rubbish.
Consider that since it’s introduction as a tanker platform every Air Force worldwide that has demanded new IFR (In Flight Refueling)airframes has selected the A330 over Boeings alternative 767 IFR
Long gone are the days of the UK looking across the pond for salvation as has the “We will fight them on the beaches” attitude, which the US seemingly clings too.
Despite it’s inherent faults the average Brit looks east not west regarding Europe as the way forward, as for being cousins in arms with the US, that we are most certainly not.
Matt Eisler - williamsburg :
Date: April 21, 2008 @ 9:01 pm
Our government and large manufacturers have no qualms in outsourcing jobs overseas. The US government condones the practice and big corporations make millions for their top executives and shareholders while middle-class workers are sacrificed by the thousands on the altar of greed.
It is this middle income population, saddled with debt, facing job losses, losing benefits, health care and pensions that takes great offense at the Air Force KC-X choice.
Sure, Americans will happily spend millions a day on cheap Chinese manufactured goods without a thought given to the average domestic worker. But hold up a 40 Billion dollar tanker deal with 100 Billion dollar potential and, well, as they say, soon we’re talking real money here. Money that even the sometimes obtuse general public can see leaving the country.
You and I may know the multinational makeup of an Airbus, including some content from these shores, but the major design and assembly of EADS aircraft occurs within the borders of the country we all love to hate. The French connection will always work against Airbus in the court of public opinion. It is inevitable.
Congress gets all of the above 110 percent and will act quickly and decisively to stop the deal.
Now I understand that many nations have already chosen the larger and somewhat newer A330 based tanker. While their numbers as a group are quite high, the market they command is but a piece of the pie. The US Air Force, on the other hand commands over two thirds of the tanker market.
And while I can see how the A330 will make a peachy fueling platform, there is no reason why the Boeing 767 cannot also be put to the same task. According to information recently released, the KC-767 is actually looking more and more like a better choice for the KC-X program.
The Boeing aircraft will directly save American taxpayers billions in fuel, maintenance and fleet integration costs over the life of the program. The real savings come when the local team keeps the skilled manufacturing and highly paid union jobs in the country and that fact gets the attention of the majority over here.
The Airbus-Northrop plan offers relatively unskilled jobs in a right to work state where workers unions have little control over wages, conditions and benefits.
So the choice is not about getting the best airplane - that is still open for debate, and it is not about hand over heart pride, no the entire house of cards built by the Air Force, EADS and Northrop Grumman will come tumbling down under the realities of the US economic situation.
Put the shoe on the other foot and our European cousins would have called foul on this deal before it had a chance to compete. And yes, you may not wish to claim us in good times, but we’ll still claim our heritage by default, Cuz!