Breaking: GAO Sustains Boeing Tanker Protest

This is a breaking story and will be updated as details become available.

GAO Statement


“We recommend that the Air Force reopendiscussions with the offerors, obtain revised proposals, re-evaluatethe revised proposals and make a new source selection decision, consistent with our decision.”

f22tanker.jpg

UPDATE:
The GAO sustained Boeing’s tanker protest on seven different criteria. Explained in English. Follow the link below.

1.  The USAF used a different ruler than the one Boeing thought they were using.

TheAir Force, in making the award decision, did not assess the relativemerits of the proposals in accordance with the evaluation criteriaidentified in the solicitation, which provided for a relative order ofimportance for the various technical requirements.  The agency also didnot take into account the fact that Boeing offered to satisfy morenon-mandatory technical “requirements” than Northrop Grumman, eventhough the solicitation expressly requested offerors to satisfy as manyof these technical “requirements” as possible. 

2. The USAF said “no points for extra credit” then awarded extra credit points to Northrop.

TheAir Force’s use as a key discriminator that Northrop Grumman proposedto exceed a key performance parameter objective relating to aerialrefueling to a greater degree than Boeing violated the solicitation’sevaluation provision that “no consideration will be provided forexceeding [key performance parameter] objectives.”

3. Northrop Grumman didn’t adequately show that they could refuel all the Air Force’s fixed wing aircraft.


Theprotest record did not demonstrate the reasonableness of the AirForce’s determination that Northrop Grumman’s proposed aerial refuelingtanker could refuel all current Air Force fixed-wing tanker-compatiblereceiver aircraft in accordance with current Air Force procedures, asrequired by the solicitation.

4. The USAF toldBoeing they met a key requirement, but later decided they hadn’t fullymet it and didn’t tell them while still talking to Northrop about it.

TheAir Force conducted misleading and unequal discussions with Boeing, byinforming Boeing that it had fully satisfied a key performanceparameter objective relating to operational utility, but laterdetermined that Boeing had only partially met this objective, withoutadvising Boeing of this change in the agency’s assessment and whilecontinuing to conduct discussions with Northrop Grumman relating to itssatisfaction of the same key performance parameter objective.

5.The USAF interpreted Northrop’s refusal to meet a specific maintenancerequirement as an “administrative oversight” when it may not have been.


TheAir Force unreasonably determined that Northrop Grumman’s refusal toagree to a specific solicitation requirement that it plan and supportthe agency to achieve initial organic depot-level maintenance within 2years after delivery of the first full-rate production aircraft was an”administrative oversight,” and improperly made award, despite thisclear exception to a material solicitation requirement.

6.The USAF made errors in determining how much the tankers would costover their life and later admitted that the correct formula had giventhe advantage to Boeing.

The Air Force’sevaluation of military construction costs in calculating the offerors’most probable life cycle costs for their proposed aircraft wasunreasonable, where the agency during the protest conceded that it madea number of errors in evaluation that, when corrected, result in Boeingdisplacing Northrop Grumman as the offeror with the lowest mostprobable life cycle cost; where the evaluation did not account for theofferors’ specific proposals; and where the calculation of militaryconstruction costs based on a notional (hypothetical) plan was notreasonably supported.

7. The USAF used theirown metrics to estimate Boeing’s cost and also couldn’t prove thattheir estimates would produce reliable results.

TheAir Force improperly increased Boeing’s estimated non-recurringengineering costs in calculating that firm’s most probable life cyclecosts to account for risk associated with Boeing’s failure tosatisfactorily explain the basis for how it priced this cost element,where the agency had not found that the proposed costs for that elementwere unrealistically low.  In addition, the Air Force’s use of asimulation model to determine Boeing’s probable non-recurringengineering costs was unreasonable, because the Air Force used as datainputs in the model the percentage of cost growth associated withweapons systems at an overall program level and there was no indicationthat these inputs would be a reliable predictor of anticipated growthin Boeing’s non-recurring engineering costs.

15 Responses to Breaking: GAO Sustains Boeing Tanker Protest

  1. Ed June 18, 2008 at 3:00 pm #

    In light of the GAO ruling, the USAF must reopen the bidding process asap. Although the GAO is non-binding, theres little chance of the KC-30 selection making it past congress.

  2. crying June 18, 2008 at 5:45 pm #

    it’s sure that Boeing doesn’t know how to lose… LOL!!!!

    it’s better that they make better aircraft than complaining at every time he loses a bid!

  3. Ed June 18, 2008 at 7:38 pm #

    One question is crucial – would the KC-767 have been selected if the GAOs findings had been correctly applied in the selection process?

  4. airplanejim June 19, 2008 at 12:23 am #

    The evaluation team should be moved to waste management and The Gen in charge of this feasco fired. I would bet the Gen. is a fighter jockey. Those actions are clearly fraud on USAF’s part. Where was the DOD director of procurement in the review of the original award. Perhaps SECDEF should fire some additional people on his staff.
    Gates, your air force is out of control.

  5. Lee June 19, 2008 at 12:50 am #

    If you believe, as I do, that military procurement is about as legit as pro wrestling, then this whole fiasco makes sense. AF was supposed to give this thing to EADS – least costly means of making a huge overture to the French. Very little tech transfer or loss and not that much pain for giant Boeing. Only hitch was some in the service didn’t go for it and slipped in a few oops. Think about it: all those months with review upon review and i-crossing and T-dotting and they STILL screw up this badly? I don’t think so.

  6. 787fan June 19, 2008 at 12:16 pm #

    I personally crewed a KC-135 in the 70′s and they are the best built Aircraft in the World
    thats why they are still flying today.
    If it’s not Boeing, I’m not going….
    The Air Force tried it’s best to disregard the facts and get the Airbus. They apparently don’t
    care if the jobs got to Foreigners.
    Thank you GAO for support of American Jobs and
    American Aerospace. There is still none better than a Boeing..BTW..ONLY Boeing has developed the future. Can you say “Unattended Refueling”…

  7. AFJock June 19, 2008 at 12:26 pm #

    Finally..Someone is standing up for America.
    GAO is correct..AIRBUS no more…
    How can anyone stand-by and let them ship parts to the US and then assemble them here on our turf…That is still a European Aircraft.
    Gooo Boeing..Gooo America….Gooo Home Airbus..

  8. 787fan June 19, 2008 at 2:32 pm #

    Franck.
    You confuse Airline Manufacturing with Defense of our Country. This is NOT just a B787 but a vital piece of America’s Defense. (and NO we are NOT happy about the B787 Jobs going outside our country )but we understand that.
    BUT..Market openess stops when the product is required to defend my Country and my children from attack.
    I think both Aircraft are equal in quality.
    The difference then will be American Jobs or Jobs in Europe.
    Please note that this product will not be sold WORLWIDE and is required for U.S. only.

  9. Andrew June 19, 2008 at 6:29 pm #

    All very interesting, but the 767 cannot meet one of the most important performance requirements, namely to be able to take off from a 7,000 ft. runway at MTOW.
    Isnt this a little bit important?

  10. 787fan June 19, 2008 at 7:42 pm #

    To Anonymous…..
    If there was a competition, and a foreign offering was clearly and demonstrably superior, would you support the selection of the clearly inferior option due to it being American.
    Response……
    IF it was clearly Superior, then yes..
    But I worry what would happen if we depend on a foreign supplier and that supply gets shut off..Like bankrupt or parts shortage…Is your superior product still operational..No..We should never depend on someone else for something so vital…
    Is a 7000 ft runway important.??
    I flew on the orginal KC-135 that used old J-57 engines and used consideraly more runway than 7000 ft and we went all over the world…
    To me that’s not as critical as keeping the control of the Supply of Manufacturing here not overseas.
    Why is that such a problem.??

  11. 787fan June 19, 2008 at 7:58 pm #

    After a search on the Net…The KC-45 appears clearly superior…I stand corrected…

    http://blog.al.com/pr/2007/07/kc30_comparison_chart.html

  12. 787fan June 21, 2008 at 4:47 pm #

    On March 28, 2002, the US Air Force selected Boeing’s KC-767 stating they “have clearly demonstrated that only the Boeing Corp. can currently meet the requirements”.[2]

    The USAF was listed as giving four main reasons for this selection of the KC-767 over Airbus’s KC-330 (aircraft’s name at the time).[2]

    “”The KC-330 increase in size does not bring with it a commensurate increase in available air refueling offload,…” (USAF quote)
    The KC-330 “..presents a higher-risk technical approach and a less preferred financial arrangement.” (USAF quote)
    ” the size difference of the EADS-proposed KC-330 results in an 81 percent larger ground footprint compared to the KC-135E it would replace, whereas the Boeing 767 is only 29 percent larger.” (USAF quote)
    The KC-330 requires “..greater infrastructure investment and dramatically limits the aircraft’s ability to operate effectively in worldwide deployment.” (Summary of Quote by MAT magazine)

  13. Dirk June 22, 2008 at 4:58 am #

    @787fan:

    You know that that statement was brought by Boeing!

    No need to discuss this special part of history further, after all, it all comes down to politics, then (ask Senator McCain, who gets a lot of public support from that story) and now:

    Did anyone think there could have been an other outcome of this inquiry? In reopening the process a final selection is put back to after the elections and therefor can have no negative impact on any of the campaigns of the supporters in both camps. After all the GAO is Congress territory.

  14. EADSFan June 24, 2008 at 3:31 pm #

    There is no requirement for the new tanker to take off from a 7000′ runway at MTOW… this is a bogus arguement

  15. bevel450 June 27, 2008 at 5:41 pm #

    I really wonder why Boeing didn’t pitch some sort of 787 derivative to get the tanker fielded with the latest technology. The KC-135 had contemporary technology when it was fielded yet neither of the two candidate planes in this competition is competitive in the commercial field.

    Why start out with a disadvantage ?