Saturday, March 1, 2008

U.S. Air Force to buy French aerial refueling aircraft

by Rick Francona

The title may be a bit misleading, but I think it captures the thrust of how this will be received in military circles. The Air Force has awarded a $35 billion dollar contract for 179 aerial refueling aircraft - the KC-45A - to Northrop Grumman over a competing bid from Boeing, who proposed a tanker based on its 767 airliner. The deal over the lifespan of the contract could be worth as much as $100 billion.

Northrop Grumman or Boeing - what’s the big deal? The big deal is that while Northrop Grumman may sound like an American corporation, it is actually the American partner of European Aeronautic Defense and Space Company (EADS), the parent company of Airbus. If the deal stands, the U.S. Air Force will take to the skies beginning in 2013 in a European-designed tanker based on the Airbus A330 airliner. The A330 is built in Toulouse, France.

Northrop Grumman/EADS has committed to the “final assembly” of the KC-45A in Alabama, but it is difficult to determine how much of the aircraft will actually be manufactured in the United States. The initial aircraft will be built in France and converted into the tanker configuration in Alabama. How long before the aircraft are made/assembled in Alabama? It is difficult to say, since the factory in Alabama has yet to be built. With the economy slowing, fears of recession and Congress about to add over $150 billion to the deficit in a rebate program designed to stimulate consumerism, the United States Air Force decides to buy a foreign aircraft.

When asked about the “foreign” nature of the contract, General Arthur Lichte, commander of Air Mobility Command (operator of the USAF refueling fleet) bristled. His response: “This is an American tanker. It's flown by American airmen. It has a big American flag on the tail, and every day, it'll be out there saving American lives.”

Nice try, general. Painting an American flag on the tail of an aircraft does not make it an American tanker. It makes it a French tanker with an American flag on the tail. Like lipstick on a pig, it’s still a pig.

Not to be outshone by this display of patriotism, we also have another bright light weighing in - Senator Richard Shelby of Alabama: "Not only is this the right decision for our military, but it is great news for Alabama." Given Airbus’s predatory sales tactics and penchant for lining the pockets of politicians all over the world, perhaps Senator Shelby should clarify his remarks. Is it great news for the Air Force and Alabama, or is it just great news for Richard Shelby?

There are several key issues here, among them the effect of this contract on the U.S. economy and the potential impact on our national security. Start with the economy and the impact on the families of the workers in the Seattle area who will not be building hundreds of military aircraft for their own country. I suspect, however, the news will be welcomed in the communities around Toulouse. With increasing criticism of American companies exporting jobs, now we have the Defense Department essentially doing the same thing.

According to Boeing, had it won the contract, it would have meant the creation or retention of about 44,000 jobs in the United States. Although Airbus claims its contract will create 25,000 jobs, it is difficult to see how. A figure of about 2,500 is probably more accurate – Airbus has a history of overestimating these things.

Congress still has to fund this contract. At a time when we are facing record oil and gasoline prices, and a declining dollar, should we be exporting jobs and procuring a foreign military aircraft? How much will spare parts cost if prices are tied to the Euro?

No doubt, Airbus builds a quality aircraft. The A330 airframe is larger than the Boeing 767 and thus carries a larger payload - fuel, cargo or troops - farther. That said, if the Air Force wants or needs a longer range tanker-transport, it should have made that part of the initial requirement. The Boeing 767 meets the Air Force requirement as stated. If the Air Force had stated a requirement for longer range and payload capabilities, there is a Boeing option based on the larger 777 airframe.

I suspect Boeing will exercise its right to protest the award of the contract to Northrop Grumman/EADS. Historical precedent for successful challenges is not promising, but there is an added component here – national security.

Relying on foreign suppliers of military equipment is not in our national security interests. What if France decides it does not support or condone a future American military operation somewhere in the world and prohibits French companies from supplying parts to the U.S. armed forces? The new tanker will likely be the backbone of the American refueling fleet for the next half century. We cannot predict the long-term political situations in other countries that could affect our access to spare parts.

To add weight to that argument, let us not forget that we have done the same thing to other countries in the past. Countries, such as Pakistan and Libya, have ordered and paid for American-built aircraft (F-16 fighters and C-130 transports, respectively), only to find that delivery was blocked by Congress. We should not put ourselves in a position to have our foreign policy held hostage by the whims of another country.

The Airbus A330-based tanker is a fine aircraft, but it is a fine French aircraft. The United States Air Force needs an American aircraft.