A former chief US arms buyer urged the Defense Department on Thursday to reject a Boeing push for more time to bid on supplying aerial-refueling planes valued at up to $35bn.
"I think there's a time urgency to this programme," said Jacques Gansler, undersecretary of defense for acquisition from November 1997 to January 2001. "And Boeing – if they say they're not going to bid unless they get an extra six months – well fine, don't bid."
Saying he did not have "any dog in the fight," Gansler argued the government had already obtained the benefits of competition when it tapped Northrop Grumman Corp over Boeing for the aircraft in February.
"I mean I don't care whether Northrop or Boeing wins" a renewed competition, he added in a telephone interview. "But I do care about good government."
In the redo, Chicago-based Boeing is vying against a transatlantic team of Northrop and Airbus parent EADS for a contract to build 179 tankers used to refuel aircraft in mid-air.
The deal, valued at $35bn, would start phasing out the US Air Force's KC-135s, which average more than 46 years old.
The Pentagon is rerunning the contest because a federal arbiter, acting on a Boeing protest, found the air force had made 'significant errors' in the procurement process. The Pentagon is expected to issue a final request for proposals next week.
Asked about Gansler's comments, Chris Isleib, a Defense Department spokesman said, "Negotiations are continuing." He declined to elaborate.
The air force calls tankers its number-one acquisition priority. But getting them has been delayed since an initial $23.5bn lease-purchase plan collapsed in 2004 amid a scandal that sent two Boeing officials to prison for conflict-of-interest violations.
Boeing said last week it may walk away unless the Pentagon agrees to extend by four months the currently projected 60-day deadline for new bids. The Pentagon's goal is to award a contract before the next US administration takes office on 20 January.
Boeing said it was not challenging the revised bidding rules. But it has concluded the 767-200 model it initially proposed would not be able to win because of a decision to give extra credit for the ability to haul more fuel than strictly required. The Airbus A330 derivative offered by Northrop is larger and carriers more fuel.
"We certainly respect the Defense Department's right to change the requirements and seek a larger plane," said Dan Beck, a Boeing spokesman. "All Boeing is asking is for bidders to have sufficient time to prepare meaningful and competitive proposals in this very new competition.
"For a plane that will be required to fly for more than four decades, four additional months is a reasonable time to ensure that the Pentagon has good alternatives to evaluate and choose from in a competition that, this time, leaves no question about its fairness," he added.
Gansler, now at the University of Maryland School of Public Affairs, said he felt strongly about issues that had arisen in the competition and had been following it 'pretty closely.'
"The first and most important one is the fact that Congress shouldn't be making procurement decisions," he said. "This would set the United States back 100 years at least if that were to happen."
Gansler has been tapped by John Young, the Pentagon's current top weapons buyer, to chair a study by the Defense Science Board, an advisory group, on buying commercially available items for military use.
He said the study, close to being wrapped up, was relevant to the tanker procurement but did not look at the tanker issue directly.
By Phil Berlowitz, Reuters.
