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GAO denies Boeing bid to overturn LRS-B contract

The US government has rejected a Boeing attempt to overturn Northrop Grumman’s hold on a contract to develop and build the US Air Force’s long-range strike bomber (LRS-B).

The 16 February decision by the Government Accountability Office (GAO) disputes Boeing’s claim that the air force’s evaluation of the competing bids was “fundamentally flawed”.

Instead, the GAO says the air force’s technical and cost evaluation of Northrop’s proposed aircraft design was “reasonable, consistent with the terms of the solicitation and in accordance with procurement laws and regulations”.

The USAF awarded the engineering and manufacturing development contract to Northrop on 27 October, appearing to end a long competition with a rival team led by Boeing.

Boeing filed a protest with the GAO less than two weeks later, triggering a review process that could take no longer than 100 days. The GAO released the decision on the last day of the review window.

Boeing now has the option to appeal the GAO’s decision with the US Court of Federal Appeals.

“We continue to believe that our offering represents the best solution for the air force and the nation, and that the government’s selection process was fundamentally and irreparably flawed,” Boeing says in a statement. “We will carefully review the GAO's decision and decide upon our next steps with regard to the protest in the coming days.”

As Boeing considers its options, Northrop is still waiting for an order by the USAF to proceed with the terms of the two-part contract award. The first part, estimated to cost $21.4 billion, will complete the design of the new bomber and build an unspecified number of prototypes for flight tests. Another 21 production aircraft will be built under the second part of the contract award, the first batch of as many as 100 bombers currency planned for the LRS-B programme.

For its part, Northrop says the GAO decision “confirms that the US Air Force conducted an extraordinarily thorough selection process and selected the most capable and affordable solution”.

The precise cost to develop and build the new aircraft is, like so many details of the secretive LRS-B programme, classified. The USAF has stated only that cost to build the first 21 aircraft is in line with a long-term objective to deliver 100 aircraft at an estimated cost of $511 million each, based on the value of the dollar in 2010.

The USAF’s Fiscal 2017 budget request submitted on 9 February shows that funding for LRS-B declined by $2.8 billion compared to the previous year’s budget proposal. But the USAF insists the programme is not being curtailed or slowed. Instead, the USAF sharpened its cost estimate for the programme based on the specific terms of Northrop’s bid.

Northrop has not revealed any major subcontractors or systems suppliers for the new bomber. Boeing had teamed up with Lockheed Martin’s Skunk Works design team, but the identities of the engines, avionics and electronic warfare suppliers were never identified.

In December, Northrop hosted a group of journalists in Palmdale, California, to tour the empty hall where the company once built the B-2. Though the USAF has not revealed where the new bomber will be assembled, it was clear on the tour that Northrop has big plans for the old B-2 manufacturing centre. Several adjacent lots around the Palmdale airport have been acquired to accommodate unspecified expansion plans. The B-2 facility itself is due to receive a facelift, which includes plans for converting the facility into a classified production environment.

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