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WASHINGTON: The US Air Force likely would seek to buy refueling planes from both Boeing Co. and a rival transatlantic team led by Northrop Grumman Corp., the top Air Force general said Wednesday.
Boeing is vying with the team of Northrop and Airbus parent EADS to supply 179 tanker planes, valued at about $40 billion, in the first phase of a fleet-renewal program expected to be worth more than $100 billion over more than 30 years.
“I think down the road you'll see us go to a mixed fleet,” Gen. Michael Moseley, the Air Force chief of staff, told a briefing hosted by the State Department's Foreign Press Center in New York and also videoconferenced to reporters in Washington.
This was because there was “some utility” to having larger and smaller tankers, just as the current fleet is made up of bigger KC-10 and smaller KC-135 models, he said.
The prospect of a mixed fleet is good news for Los Angeles-based Northrop, which had threatened to shun the competition until this month for fear it was skewed to favor Chicago-based Boeing.
The Northrop team is offering a modified Airbus A330 airliner, which is bigger and expected to be pricier than the Boeing candidate, a modified 767 passenger jet.
Moseley said the Air Force may need as much as another $20 billion a year for at least the coming five years to replace aging aircraft fast enough to keep unit costs affordable.
“It's looking like (the additional fund need) could be $20 billion a year through the FYDP,” he said, referring to the Pentagon's Future Years Defense Plan that projects spending through 2013.
At issue is the total the Air Force thinks it would be short to meet modernization goals even if it gets the $110.7 billion sought by U.S. President George Bush for fiscal 2008, which starts Oct. 1.
The tanker replacement program is the Air Force's No. 1 acquisition priority. It has been dragged out for years since a procurement scandal killed a $23.5 billion Air Force sole-source plan to lease and buy 100 Boeing KC-767s.
The contract for the first phase is to be awarded by late summer, to be followed by a competition for another batch of 180 to 200 planes, Moseley said.
“So there will be a continual set of opportunities for both companies to compete,” he said, adding that the Air Force, in making its choice, would focus on the future tankers' “lifecycle” costs .
“Lifecycle cost has to be as low as we can get it with the most capable airplane we can get,” he said.
