March 8, 2010

Statement of Rep. Dicks Regarding Northrop Grumman's Decision to Withdraw from Tanker Competition

“Today’s decision should allow the Defense Department to move forward expeditiously with the replacement of the KC-135 tanker fleet.  I believe the Northrop Grumman Corporation has made a prudent decision to forego responding to the Air Force’s request-for-proposals, based on the requirement to replace the KC-135s with an aircraft that fulfills the aerial refueling role in the most cost-effective manner.  A tanker based on the A-330 airframe, much larger than the Boeing 767, would clearly have been more costly to purchase, operate and maintain.” 

“After the last flawed attempt to award a tanker contract, I found that the Air Force had not followed requirements approved by the Joint Requirements Oversight Council in evaluating life-cycle costs over a 40-year period.  I insisted that a 40-year life-cycle analysis for fuel and military construction be part of the next competition.  The added fuel cost alone, based on the 40-year life cycle analysis that now is specified in this procurement, would add billions more to the cost of the Northrop Grumman proposal and, combined with other factors, would likely make winning this ‘best-value’ competition a very remote possibility.  Thus I applaud the Northrop Grumman Corp. for its assessment and its decision not to delay the procurement by submitting a bid and requiring the government to conduct another lengthy competition.  The Defense Department already has substantial competitive insight from the last competition.  I am confident that they can now utilize their authority to proceed with the procurement of KC-767 tankers as quickly as possible, negotiating a contract that will allow the Air Force to begin replacing its tanker fleet rapidly with modern aircraft that will be more capable and far-less-costly to maintain that half-century-old aircraft.  Both the Secretary of Defense and Air Force Secretary Donley have recently stated their confidence in the government’s ability, in the absence of a tanker competition, to negotiate a contract that will be cost-effective and that will deliver the best value to the warfighter.”

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