First Air Force Tanker Flight on Track Despite Cost Overruns

The Air Force is on track for the first flight of its new KC-46 Tanker aircraft by September of this year despite technical challenges and Boeing's announcement that their firm went over the contract-imposed cost caps for the program, service officials said.

"We're still on track for a first KC-46 flight by September," Brig. Gen. Duke Richardson, Air Force Program Executive Officer for Tankers, said in a written statement.

This optimism comes despite Boeing's announcement that their firm would absorb $536 million in extra after-tax charges related to some unexpected costs of production and development of the new tanker.

The Air Force-Boeing cost cap woven into the contract for the tanker is $4.9 billion for the program, an amount which Boeing has had to exceed.

Extra required work on the airplane's integrated fuel system is the reason for the extra Boeing payments, a company statement said. The extra costs were incurred by Boeing due to a firm-fixed cost cap woven into the Air Force-Boeing contract for KC-46 development.

"The added investment will support the engineering redesign, manufacturing and retrofit and qualification and certification of the fuel system changes, and the conclusion of ground and flight testing on the program," a Boeing statement said. "The KC-46 fuel system is a complex, integrated system that provides fuel to the aircraft's engines and the capabilities to refuel other aircraft in flight. It is the final major system to be qualified in the KC-46 development program."

Boeing CEO Dennis Muilenburg said they still plan to meet the established benchmark of delivering 18 tankers to the Air Force by August of 2017.

"We have a clear understanding of the work to be done, and believe strongly that the long-term financial value of the KC-46 program will reward our additional investment," he said in a statement.

Richardson told the Air Force has confidence in Boeing's progress.

No Showstoppers

"While we have more heavy lifting coming up, we believe it is achievable and do not see any technical showstoppers," he said.

Boeing still plans to deliver 179 tankers by 2027, Muilenburg stated. The company still believes it can deliver 17 "operationally-ready" KC-46s by August 2017 as laid out in the initial contract, Richardson said.

A Boeing statement said the company estimates that an anticipated $80 billion global market for tankers will enable the KC-46 tanker to eventually be quite profitable for the firm once it fully enters formal production.

The Air Force's multi-year tanker procurement program is one of the service's top two priorities. The average KC-135 is about 50 years old and the average KC-10 tanker is roughly 29 years old, service officials said.

The 165-foot KC-46A is being built with Pratt and Whitney engines and the ability to transport up to 212,000 pounds of fuel and 65,000 pounds of cargo. The aircraft will bring an improved ability to conduct aerial refueling missions, Air Force officials said.

The KC-46A will refuel F-22s, F-15s, F-16s, F-35s, C-17 and KC 10s, among others.

The new tanker can refuel aircraft via the probe and drogue while also using a boom and receptacle on a single mission. The aircraft can conduct multiple refueling missions concurrently using a drogue, or refueling mechanism on the wings, and a more standard boom and receptacle system.

Senior Air Force officials explained that the 767s are being engineered and manufactured with some military specifications in mind so as to prevent the need to strip down the aircraft and fully re-configure it for military use, as has often been the case with prior Air Force aircraft acquisition efforts.

-- Kris Osborn can be reached at

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