How Boeing Doth Protest



On Tuesday, the Boeing Company formally submitted its protest of the NorGrum/EADS tanker award to the Government Accountability Office. The process takes like 60-90 days supposedly, but have we yet to resolve the CSAR-X protest? No. So I don't have much hope for this one ending any time soon.

And that's a shame, because more than a new CSAR, the Air Force has got to replace the oldest of its KC-135s very soon, or metal fatigue will seriously hamper aerial refueling ops. It seems that this argument has been firmly planted in the political arena and that Boeing's arguments on the technical flaws they find in the award are an outgrowth of prodding from Capitol Hill and the unions.

I could be wrong, of course, and maybe there was a grand conspiracy here to award the deal to Airbus. But it seems to me -- and call me crazy -- that after the last tanker fiasco (which cost an Air Force Secretary his job) the Air Force would have been SUPER careful about its award. I mean, the Air Force has professional acquisition officers who do nothing their entire careers but buy stuff and work contracts to the "T." With such a high-stakes contract and its shady history, don't you think the folks who decided this worked the angles backwards and forwards? It doesn't make sense to me that the Air Force would have been slip shod on this one.

Secondly, I need to say outright here that Sue Payton, the Air Force's top acquisition official, is about as professional and honest as any civil servant can come. I interviewed her a couple times over the years and have found her honest, forthright and enthusiastic about her service and responsibilities. I just don't see her letting anything be taken to chance.

And lastly, I find it humorous that Boeing is using the same argument to protest the tanker award that Sikorsky and Lockheed Martin are using in their protest of Boeing's win in the CSAR-X contract: that the service asked for a medium-sized tanker and awarded a heavier one.

Here's a release from Boeing forwarded to me yesterday after a conference call with reporters (that I missed because my email server was down dammit!) explaining the logic behind their protest:

  • The contract award and subsequent reports ignore the fact that in reality Boeing and the Northrop/EADS team were assigned identical ratings across all five evaluations factors: 1) Mission Capability, 2) Risk, 3) Past Performance, 4) Cost/Price, and 5) Integrated Fleet Aerial Refueling Assessment. Indeed, an objective review of the data as measured against the Request for Proposals shows that Boeing had the better offering in terms of Most Probable Life Cycle Costs, lower risk and better capability.
  • Flaws in this procurement process resulted in a significant gap between the aircraft the Air Force originally set out to procure - a medium-size tanker to replace the KC-135, as stated in the request for proposal - and the much larger Airbus A330-based tanker they ultimately selected. It is clear that frequent and often unstated changes during the course of the competition - including manipulation of evaluation criteria and application of unstated and unsupported priorities among the key system requirements - resulted in selection of an aircraft that was radically different from that sought by the Air Force and inferior to the Boeing 767 tanker offering.
  • Because of the way the Air Force treated Boeing's cost/price data, the company was effectively denied its right to compete with a commercial derivative product, contrary not only to the RFP but to federal statute and regulation. The Air Force refused to accept Boeing's Federal Acquisition Regulation-compliant cost/price information, developed over 50 years of building commercial aircraft, and instead treated the company's airframe cost/price information as if it were a military-defense product. Not only did this flawed decision deny the government the manufacturing benefits of Boeing's unique in-line production capability, subjecting the Air Force to higher risk, but it also resulted in a distortion of the price at which Boeing actually offered to produce tankers.
  • In evaluating Past Performance, the Air Force ignored the fact that Boeing - with 75 years of success in producing tankers - is the only company in the world that has produced a commercial derivative tanker equipped with an operational aerial-refueling boom. Rather than consider recent performance assessments that should have enhanced Boeing's position, the Air Force focused on relatively insignificant details on "somewhat relevant" Northrop/EADS programs to the disadvantage of Boeing's experience.
  • Boeing offered an aircraft that provided the best value and performance for the stated mission at the lowest risk and lowest life cycle cost," said McGraw.

"We did bring our A-game to this competition. Regrettably, irregularities in the process resulted in an inconsistent and prejudicial application of procurement practices and the selection of a higher risk, higher cost airplane that's less suitable for the mission as defined by the Air Force's own request for proposal. We are only asking that the rules of fair competition be followed.

Come on, everyone, including Boeing, knew from the VERY BEGINNING that Airbus was going to offer up the A330. It seems a little strange for Boeing to complain about some misconception of the criteria now.

But, again, I think this is getting more political than contractual. We'll see. And keep an eye out for more coverage here on the attempt to hang the lost contract on the Republican presidential nominee...

-- Christian

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