CHORA VIOLA
Northrop-EADS Win $40 billion USAF Tanker Contract
(Source: US Department of Defense; issued Feb. 29, 2008)
Against all expectations, Northrop-EADS has won the competition to supply the US Air Force with 179 tanker aircraft. (Northrop Grumman photo)
PARIS 
--- In a stunning upset, Northrop Grumman and EADS have beaten Boeing to win a $35 billion, 25-year contract to provide 179 KC-45A tanker aircraft to the US Air Force. The aircraft are derived from the Airbus A330 commercial airframe.
The initial contract, worth $1.5 billion, will cover development and initial procurement of four aircraft, with options for procurement of the first 64 production aircraft in several lots, at a cost of $10.6 billion. Follow-on procurement of 110 production aircraft, split into several production lots and worth $35 billion, will follow over a period of 25 years, Assistant Secretary of the Air Force for Acquisition Sue C. Payton told reporters during a news conference at the Pentagon Friday afternoon. Additional costs will be incurred for sustainment and support, increasing the program’s value beyond the stated $35 billion, she said.
These initial 179 KC-Xs will be followed “in a few years” by a separate competitive program, dubbed KC-Y, that will ultimately fund procurement of several hundred additional tankers, Payton said.
Gen. Arthur J. Lichte, commander of Air Mobility Command, said that the Northrop/EADS KC-30 had been chosen because it offered “more cargo, more fuel offload, more passengers and more availability.” He and Payton denied that cost was a significant factor in the decision, and deferred further questions until Boeing had been fully debriefed on the decision.
(EDITOR’S NOTE: We will update this story as the Pentagon releases further details.) (ends)
Air Force Announces Tanker Contract
(Source: US Air Force; issued Feb. 29, 2008)
WASHINGTON --- Secretary of the Air Force, Michael W. Wynne, and Vice Chief of Staff of the Air Force, Gen. Duncan J. McNab, announced the selection of Northrop Grumman Corporation, headquartered in Los Angeles, Calif., as the winner of the KC-X competition for development and procurement of up to 179 tanker aircraft for approximately $35 billion.
The initial contract for the newly-named KC-45 is for the system design and development of four test aircraft for $1.5B. This contract also includes five production options targeted for 64 aircraft at $10.6B.
"The tanker is our number one procurement priority right now. Buying the new KC-45A is a major step forward and another demonstration of our commitment to recapitalizing our Eisenhower-era inventory of these critical national assets. Today is not just important for the Air Force, however. It's important for the entire Joint military team, and important for our coalition partners as well. The KC-45A will revolutionize our ability to employ tankers and will ensure the Air Force's future ability to provide our nation with truly Global Vigilance, Reach, and Power," said General McNab.
"The tanker is the number one procurement priority for us right now. It is the first step in our critical commitment to recapitalize our aging fleet to move, supply, and position assets anywhere. In this global Air Force business, the critical element for air bridge, global Intelligence, Surveillance and Reconnaissance, and global strike is the tanker," said General McNab.
The KC-45A will provide significantly greater air refueling capabilities than the current fleet of Eisenhower-era KC-135s it will begin replacing. For example, it will be able to refuel Air Force and Navy aircraft on every flight. These aircraft have different systems for receiving fuel and today the KC-135s must be set up for one or the other before takeoff. The KC-45A will be equipped for both systems on every flight and will also have connections for wing pods. When wing pods are installed, it can refuel two probe-equipped aircraft, such as Navy and many allied aircraft, at the same time. It can even be refueled in flight by other tankers.
The KC-45A will also have defensive systems that allow it to go into dangerous environments that we currently have to avoid. It will also supplement our airlift fleet by carrying cargo, passengers, and medical patients in a secondary role.
The KC-X source selection used a "best value" determination to select a winner based on five factors: Mission Capability, Proposal Risk, Past Performance, Cost/Price, and an Integrated Fleet Air Refueling Assessment (performance in a simulated war scenario). These five factors were developed after consulting with industry and were finalized prior to starting the competition. Considered together, these grading criteria ensured the Air Force maximized the capability delivered to the warfighter while optimizing the taxpayers' investment.
The Air Force followed a carefully structured process, designed to provide transparency, maintain integrity and promote fair competition. The Air Force met with offerors on numerous occasions to gain a thorough understanding of their proposals and provide feedback on their strengths and weaknesses. The Air Force also provided insight into government cost estimates throughout the process instead of waiting until the post-decision debrief. The competitors indicated they've been very pleased with the degree of communication.
The evaluation team was comprised of experts covering a broad spectrum of specialties from acquisition to operations and was hand-picked from across the USAF and other government agencies.
As part of the process, the Air Force will now provide a written notice to both the selected and not-selected and offer to provide a de-brief on their bid proposals. To maintain the integrity of that process, the Air Force will be unable to provide additional information about the proposals and contract.
"Today's announcement is the culmination of years of tireless work and attention to detail by our Acquisition professionals and source selection team, who have been committed to maintaining integrity, providing transparency, and promoting a fair competition for this critical aircraft program," said Secretary Wynne. "Through these efforts we believe we will provide a higher-value resource to the warfighter and the taxpayer." (ends)
U.S. Air Force Selects Northrop Grumman to Provide the New KC-45A Aerial Refueling Tanker
(Source: Northrop Grumman Corporation; issued Feb. 29, 2008)
LOS ANGELES --- Northrop Grumman Corporation announced today that it has been selected by the U.S. Air Force to provide the KC-45A aerial refueling tanker for the KC-135 tanker replacement program. The Air Force's KC-45A is based on the highly-successful A330 commercial airframe, produced by EADS.
"We are excited to partner with the Air Force for their number one acquisition priority, the KC-45A Tanker," said Ronald D. Sugar, Northrop Grumman chairman and chief executive officer. "Northrop Grumman's vast expertise in aerospace design, development and systems integration will ensure our nation's warfighters receive the most capable and versatile tanker ever built. The Northrop Grumman KC-45A tanker will be a game changer."
The initial KC-45A contract provides four System Design and Development aircraft and is valued at $1.5 billion. The first KC-45A airframe completed its first flight on Sept. 25, 2007 and will now begin military conversion to the tanker configuration. The KC-45A's Aerial Refueling Boom System is currently in flight test and has successfully performed numerous in-flight contacts with receiver aircraft.
"Clearly the U.S. Air Force conducted a thorough and transparent competition in choosing their new tanker, which resulted in selection of the aircraft that best meets their current and future requirements," said Gary Ervin, corporate vice president and president of Northrop Grumman's Integrated Systems sector. "By selecting the most capable and modern aircraft, the Air Force has embraced a system that provides a best-value solution to our armed forces and our nation."
The KC-45A Tanker aircraft will be assembled at new, state-of-the-art manufacturing facilities in Mobile, Ala., and will employ 25,000 workers at 230 U.S. companies. The KC-45A's refueling systems will be built at new facilities in Bridgeport, W.Va., and delivered to the KC-45A Production Center for aircraft integration.
The KC-45A will be built by a world-class industrial team led by Northrop Grumman, and includes primary subcontractor EADS North America and General Electric Aviation, Sargent Fletcher, Honeywell, Parker, AAR Cargo Systems, Telephonics and Knight Aerospace.
Northrop Grumman Corporation is a $32 billion global defense and technology company whose 120,000 employees provide innovative systems, products, and solutions in information and services, electronics, aerospace and shipbuilding to government and commercial customers worldwide.
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