Posted on 06/22/2006 3:59:20 PM PDT by Paul Ross
US Air Force leaders wary of tanker services offering
Omega Air Inc., a private company owned by Irish investors, has offered the Air Force up to 60 modified DC-10s on an hourly basis. Its services will compete against new tankers offered by Boeing Co. (BA) and a team of Northrop Grumman Corp. (NOC) and the European Aeronautic Defence and Space Co. (5730.FR), primary parent of Airbus.
The Air Force hopes to pick a winner next year. But the competition has already begun, with an Air Force request for information that specifically asked about service contracts as well as new planes. Officials say the Omega bid adds a welcome dimension to the heavily scrutinized contest, but it also raises a host of new questions.
Air Force Secretary Michael Wynne and Chief of Staff Gen. Michael Moseley say the service will listen to all comers. In interviews last week, however, both officials were skeptical about any solution that didn't involve outright purchases of new aircraft.
"Under normal circumstances, we see a lot of the things that Omega wants to do as the best training we can give to our tanker pilots," Wynne said. "To take away that opportunity and believe that without training they can just go do a different mission in an operational theater, it stretches me a little bit."
The Air Force also needs to be careful about its long-term obligations, Wynne said. Since commercial airlines don't use refuelers, the Air Force might become the sole customer supporting Omega's payroll.
"We would be the primary market for a company if it got set up like that, which would give us a little bit more responsibility than we probably want to take on," Wynne said.
Omega says it would sell tanking services to the Air Force on an hourly basis, with all aircraft and personnel costs built in. An Omega spokesman said the company plans to hire former Air Force pilots and other ex-military personnel to operate its tankers.
Such personnel might be readily available, since commercial airliners have been cutting back on staff. The Air Force also is cutting personnel, in a bid to free up more money for new weapons systems like the replacement tanker.
But Omega still would need to negotiate a long-term relationship with the Air Force that is compatible with the federal budget process. The company understands its contract would be subject to annual appropriations, but it would need some kind of assurance of a longer-term relationship, the Omega spokesman said.
If such a relationship develops, Omega may have its work cut out for it. It needs to be competitive or cheaper than the Air Force while juggling a host of overhead costs, said Gen. Moseley, who led air combat operations in Iraq and Afghanistan from 2001 to 2004 and who took over the Air Force's top job last year.
In the Air Force, "all the fuel costs and all the personnel costs are rolled into an existing platform. The fuel costs X amount per pound delivered to the F-16. In this contracting world, the fuel delivered to the F-16 has to be the same," Moseley said.
"I'm interested to see how those folks that would bring that to the table pay for the O&M and the personnel and the operations of that airplane," Moseley said, using the Pentagon abbreviation for the operations and maintenance budget.
Omega may not be the only bidder offering services or used planes to the Air Force. Boeing was coy about proposals other than its new 767-based tanker, but the company says it answered "all sections" of the request for information.
"It's our understanding that Part B involved more than just service providers. It also asked competitors to discuss capabilities for modification and upgrades to the existing KC-135 fleet," Boeing said in a statement, when asked about its strategy. Boeing made the Eisenhower-era KC-135, a cousin of the 707 passenger plane.
The Air Force expects to issue a draft request for proposal in September, with a final request for bids early next year. If funding for the new tanker stays on track, the Air Force seeks to award a contract by August 2007.
Wynne said the Air Force will be looking first and foremost for a new tanker, even as it considers the cargo, medical evacuation and business characteristics of each of the contenders. As the contest moves forward, the Air Force wants to avoid a repeat of the controversy that sank a previous, $23 billion plan to lease and buy 100 Boeing tankers.
"By and large, what we're looking for is primarily tanking," Wynne said. "I'm not sure how much we would pay for the multimission capability as opposed to just getting our tanker fleet refreshed."
That focus on fuel could give Boeing the final edge, because its 767 is smaller than the A330 or the DC-10, said Lexington Institute defense analyst Loren Thompson. He said the Air Force doesn't regularly face long distances that would favor a bigger tanker plane, but the Pentagon often contends with limited runway space.
"A key challenge the Air Force faces in buying a next-generation tanker is finding a plane that will not crowd airfields so much that they can't put enough tankers where they need them," Thompson said.
I'm not an airman, but I am a politician. Picture this scenario, which I consider to be very realistically possible:
We hire the Irish firm to tank our military aircraft. Then a government is elected in the Irish Republic that is militantly anti-nuke, much as New Zealand's was/is. The Dáil Éireann (Irish house of commons) passes a law that prohibits any Irish company from commercial ventures involving nuclear weapons in any way "for safety reasons". Goodbye refuels for B-2's, B-1's and B-52's.
Or....the Dáil gets infected with the currently fashionable European antisemitism and forbids Irish companies from doing business with Israel. Israel is attacked and urgently needs resupply from the US...
You get the idea.
Contract terminated for material breach, Irish company forfeits political risk bond and most likely cannot afford penalty clauses, air and ground assets get seized by US government, contract re-let to qualified bidders.
Political risk is a part of doing business, and gets dealt with very aggressively. I had a contract to provide computer software to a foreign government, and some of the contract terms revolved around "and what happens if you idiots throw Reagan out next year?" (The government was and is friendly, but was and is not flavor of the month with Democrats.) I had to make a real gut check on that contract--if Mondale had won in 1984, my company would have gone under.
I doubt this. And particularly from the national defense preparedness standpoint.
...but some people are letting bigotry and anger replace logic and market analysis.
And who might they be, h'mmm? The only one suddenly raising racial/ethnic issues here by implication ...would have to be you.
As for replacing logic and market analysis...with something less...the phoney free traders did that long ago when they gave the subsidies of EADS/Airbus a pass. They have no moral compass whatsoever...and no basis of disinterested neutrality or even dispassionate rationality (which clearly they lack), to argue anything.
Total whores.
Double ditto.
Wrong. Corruption is inimical to national self-rule and liberty. Look at Mexico. The perpetrators of the Boeing corruption have been busted, and are doing time. You can't say the same of the "competition."
Is it even possible that any of the corruption which envelopes and suffuses all of EADS and Airbus deals will result in any criminal prosecutions and convictions.
I am not going to hold my breath.
As for being "Pro-American" I am not going to apologize for it.
And your "Bigotry" insinuations are beneath contempt.
American industry is vital to our national security, and cannot be outsourced without catastrophe in its wake.
What I'm trying to say is that Airmen are refueling our Guys, not some person that is just working for money, because i want our Airmen to get the fuel. I think you AIRMEN would understand that. They are our BROTHERS.
I got the IDEA so figure3 this out. I want my BROTHERS to get the FUEL they need.
Grow up AIRMAN. I flew on NKC-135's and we needed Navigaters.
"Most of them have quite a number of combat-associated experience." The point I'm trying to make is that they will be working for a civilian company and they will have to listen to their stoct holders. I want my AIRMEN that need fuel to get it wether the company mkes money or not.
"There are plenty of contract maintenance folks working USAF aircraft today." I want my AIRMEN to get their FUEL.
Were you at Chanute?
Yes
That would be Colonel, and it would be navigatOrs not navigatErs.
Your rank may have been Colonel. I would have Saluted you and argued with you. I did with a some of officers that I flew with and they knew that with my tool box, that their engines would keep turning and burning and they would stay airborne. Remember this Colonel, WE are BOTH AIRMEN and we always have been. I send you the salute and also the arguing. Thank you sir for the spelling lesson.
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