Manufacturer free to bid for launch contracts after 20-month ban is lifted

Planning for competitive procurement of the next batch of launches under the US Air Force's Evolved Expendable Launch Vehicle (EELV) programme has resumed after the lifting of a 20-month suspension on Boeing.

Contracts for 18-24 launches over two to three years, beginning in 2008, are expected to be awarded next year.

"I believe it is imperative that we have two proven launch systems, so we have assured access to space," said acting air force secretary Peter Teets, announcing the lifting of the suspension. "Because of that, I am very pleased to have Boeing back as a viable launch provider, along with Lockheed Martin."

Boeing's Launch Systems, Launch Services and Delta launcher business units were suspended in July 2003 for unlawful possession of Lockheed documents during the 1998 EELV competition.

Intended to last 60 to 90 days, the suspension ended up being the longest ever imposed on a major US defence contractor.

In addition, the USAF reallocated to Lockheed eight of the 20 launches awarded to Boeing under the EELV Buy 1 contract. The air force subsequently awarded three additional Buy 2 launches to Lockheed. Teets estimates the total loss of revenues for Boeing at around $1.2 billion.

Under the interim agreement signed with the USAF, Boeing has reimbursed the $1.9 million cost of the air force's investigation. The USAF has the right to reinstate the suspension if a separate US Department of Justice criminal investigation of Boeing finds new evidence.

With the suspension lifted, Teets says the air force can now begin discussions on the Buy 3 strategy and Boeing's costs to maintain its Delta IV infrastructure. Some funding will be provided to Boeing in the near term, he says, to help bridge the gap, "as we have helped provide infrastructure sustainment costs to Lockheed Martin". The USAF has provided Lockheed $130-140 million in fiscal years 2004 and 2005 to cover Atlas V infrastructure costs.

A request for proposals for EELV Buy 3 is expected in the third quarter, with responses due late this year or early next, says Teets. The contracts will "probably be for a two- or three-year period and a ballpark 18 or 20 launches, maybe 24."

GRAHAM WARWICK/WASHINGTON DC

Source: Flight International