Let’s Work It Out
Northrop is unhappy and wants changes in the KC-X solicitation.
—Marc V. Schanz
Oct. 29, 2009—Days after the formal comment period on the Air Force’s KC-X tanker draft request for proposals closed, Northrop Grumman officials publicly expressed their displeasure with the current format of the competition during a press conference Wednesday in Washington D.C.
They said they had voiced their concerns to the Air Force during this initial feedback phase. They also intimated that the company reserved the right to withdraw from the contest if key concerns about proprietary information from the last competition are not resolved.
The rebooted KC-X is “fundamentally different” than the requirements worked out in the last competition, said Mitch Waldman, Northrop’s vice president of business development for advanced aerospace programs and technology.
Northrop beat out Boeing back in February 2008 for the rights to supply the Air Force with 179 new tankers, but the decision was later nullified by Defense Secretary Robert Gates after Boeing’s successful legal protest and intense political wrangling on Capitol Hill.
Waldman said the draft RFP as written amounts to a “cost shootout” that could sacrifice capability for a race to the bottom line.
The company, he said, has three core objections with the new RFP centered on capability; the lack of mechanisms to evaluate cost, schedule and past performance risk; and acquisition program structure. For example, with capability, the number of threshold requirements has increased to 373, while highly valued factors in the first competition such as better passenger, fuel, and cargo capacity are not included, he noted.
“This is not a best-value, capabilities-based source selection,” Waldman said.
The key threshold requirements are all weighted equally, he noted, meaning that, in theory, factors such as net-centricity and survivability would be as important as waste flow in the aircraft’s lavatory.
“If everything’s important, is anything important?” he asked rhetorically.
Going forward, Northrop sees four courses of action: the concerns in the draft RFP are alleviated; the government proceeds with the competition as is; the final RFP addresses the initial eight objections raised by the Government Accountability Office when it sustained Boeing’s protest in the last round; or a “continuous competition” is maintained with both contractors for the life of the KC-X program.
While Waldman said Northrop would be receptive to action on the GAO’s recommendations, there is a “range of options” to address concerns with the draft RFP. As a part of this, he would not rule out the company’s withdrawal from the competition.
“We need to see the final RFP before we make that determination,” he said of that extreme measure.
Following Northrop’s presentation, Boeing spokesman Bill Barksdale issued a statement critical of Northrop’s position, alleging that Northrop had begun “attacking” the Air Force’s proposal.
“Boeing has chosen to work within the process and continue asking questions,” Barksdale said. He added, “Our preference is to allow the process to play out rather than work the requirements through the media.”
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