Posted on 06/05/2005 10:39:23 AM PDT by Righty_McRight
WASHINGTON - (KRT) - As the dust settles on a series of scandals at Boeing Co., the Chicago-based aerospace giant and its nemesis, Airbus, are now jockeying to revive a multibillion-dollar Air Force plan to purchase hundreds of modified airliners as aerial refueling tankers.
Rep. Duncan Hunter, R-Calif., quietly attached an amendment to the Defense Department budget bill last month that would effectively eliminate Airbus from a future tanker bidding competition, leaving Boeing as the only available option for a contract that could be worth billions of dollars.
The Airbus defense group - called the European Aeronautic Defense and Space Co., or EADS - is hoping to nix that provision, which seeks to prohibit the Pentagon from buying goods from foreign companies, such as French-based Airbus, that receive government subsidies.
EADS has also upped the ante, promising to name a new $500 million site later this month where it would assemble aerial tankers in the United States if it gets the contract, and has put together a formidable stable of Washington lobbyists to press its case.
"They are definitely the tortoise, but they're doing the right things," said Keith Ashdown, vice president for policy for the group Taxpayers for Common Sense, which was highly critical of the first Boeing-Air Force tanker deal. "They're lobbying better than a giant American company."
Hunter's amendment may not survive in the Senate, which must still work through its version of the defense spending bill. In that chamber, Sen. John McCain, R-Ariz., has become the resident skeptic of Air Force arguments that its aging tanker fleet is in need of replacement.
But support from a powerful lawmaker like Hunter, chairman of the House Armed Service Committee, says a lot about Boeing's clout in Washington. House Speaker Dennis Hastert, R-Ill., also has pushed for a tanker purchase, stating bluntly that the Air Force needs the tankers.
And plenty of members of Congress are willing to give Boeing the benefit of the doubt.
"It has to move ahead," said Rep. Todd Tiahrt, R-Kan. His Wichita district would be home to the Boeing plant where the company would make the new tankers out of its 767 commercial models. The existing tankers, he argued, "were built 45 years ago. Are you driving around in a 1960 Dodge Dart?"
Ongoing support from Hunter and other Boeing stalwarts on Capitol Hill is especially noteworthy given Boeing's recent troubles.
The first tanker proposal in 2001 resulted in congressional, Pentagon and Justice Department investigations and sent two of the company's top executives - one a former Air Force official - to prison in the past year. In that case, a Boeing executive helped negotiate the hiring of the Air Force official while she was still handling Boeing matters at the Pentagon. The probes also contributed to the departure of longtime Boeing Chief Executive Phil Condit in December 2003.
This week, the Senate Armed Services Committee will hold yet another hearing on the doomed tanker deal, this one focusing on a yet-to-be-released Defense Department inspector general's review of the tanker lease negotiations.
That scandal came in the wake of a 2003 federal prosecution in California over the alleged theft of Lockheed Martin documents by Boeing employees.
Condit's replacement, Harry Stonecipher, pledged to reorder the company's ethical standards. But Stonecipher was forced to resign in March after he acknowledged having an affair with a female vice president within the company.
None of those troubles, though, seemed to dim hopes within Congress and the Air Force for a new tanker deal.
Though it hardly has the glitz of a new jet fighter design, industry executives know just how lucrative a tanker deal could be over the long haul. With tankers, there's no need to spend money designing a new plane since tankers are derived by modifying existing aircraft. The Air Force's current fleet consists of 545 KC-135s - modified Boeing 707s - and 59 KC-10s, the military version of the DC-10 airliner.
Boeing wants to make new tankers out of its 767; it already has 767 tanker contracts with Italy and Japan. It also just launched a freighter version of its hulking 777 aircraft, which company officials said could also do tanker duty.
"We've got 60 years of experience making tankers," said Boeing spokesman Doug Kennett. "We can make any airframe into a tanker. It's a question of what you want."
EADS is pitching its A330 aircraft as a rival. It already has tanker orders from Canada, Britain, Germany and Australia.
To press its case, EADS has hired such lobbyists as Sam Adcock, a former aide to Sen. Trent Lott, R-Miss., and Quinn, Gillespie & Associates, the lobbying firm of former Republican National Committee Chairman Ed Gillespie. EADS communications Vice President Guy Hicks is a former staff member for Rep. Jerry Lewis, R-Calif..
Congressional records show that EADS has spent $352,000 on lobbying in 2003 and $572,000 in 2004.
Still, that's nothing compared to Boeing, which spent $4.9 million on lobbying for all of its activities - civil and military - in 2003, and $5.5 million in 2004, according to lobbying records it filed with Congress.
As a relative newcomer, EADS never had much of a chance to bid for the tanker business the last time around. Air Force officials effectively ruled the company out because it hadn't developed a refueling boom that sends fuel from the tanker to aircraft flying behind it. Darleen Druyun, the Air Force official who later went to work for Boeing and then to prison, has also admitted favoring Boeing in the deal.
EADS has since developed a boom. And it hopes a commitment to a U.S. manufacturing facility will further boost its prospects.
EADS has said that it expects to soon announce plans to build a new engineering facility in one of four Southern sites chosen from an initial list of 70 communities - Mobile, Ala.; Kiln, Miss.; Charleston, S.C.; or Melbourne, Fla. If EADS were to win a tanker contract, that site would quickly expand, company officials said, to a $500 million, 1.5 million-square-foot production facility where A330 tankers would be assembled.
All four of those states have members of Congress who rank high on the Armed Services and Appropriations committees of both the House and Senate.
"Every time you're looking at opening a facility of this size, one of the things you look at is are we going to be supported in the community?" Hicks said. "Do we have an environment of success that we're going to need? Do we have support in the congressional delegation?"
A decision on a new tanker deal is hardly imminent. Stung by the flap over the earlier proposal, the Air Force is studying just how many tankers it will need and what sort of force it will service. Production of two new fighters, the F-22 and F-35 Joint Strike Fighter, is just getting under way.
A study by the Rand Corp., due in August, to examine those needs could help push the case for new tankers. The Air Force is conducting a mobility capability study that is examining how its aircraft can be deployed around the world today, and how future deployments should be structured. Those results could also have a bearing on future tanker orders.
The Air Force, though, has already spent $10.5 million to set up a new tanker program office, said spokesman Doug Karas, with the goal of holding a competition for the tanker contract in the next fiscal year, which starts in October.
A non-USA tanker should be off the table, even if it is "assembled" in the USA. Huge (all) DoD contracts should be awarded to those who pay the taxes in the first place.
Ever tanked up on the KC-10 with the NATO Pods on the wingtips and the boom on the tail?
The easiest configuration was tanking off the center hose on the KC-10, the toughest is probably tanking off the 130. Those baskets really move around.
According to www.kc-10.net the year was 1989.
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