Time to Split the Baby
A solution to the Air Force’s tanker woes.
Dec 13, 2010, Vol. 16, No. 13 • By JOHN NOONAN
Few defense acquisition tales have been as sordid as that of the U.S. Air Force’s new refueling tanker, the KC-X. The tanker acquisition program first popped up on the national radar screen in 2001, when Senator John McCain called into question a no-bid contract that would have leased modified Boeing 767s to the Air Force instead of purchasing a new tanker outright. An ensuing corruption scandal marred the leasing deal beyond recognition. In the years since, the issue has been punted by both the Pentagon and Congress to new administrations and new budgets, tangled up by defense contractors’ waffling between new bids, no bids, and retracted bids, and unnecessarily delayed by elected officials’ squabbling over jobs and pork.
The need for a new tanker aircraft is pressing. The backbone of the aerial refueler fleet, the KC-135, was initially fielded in the 1950s. Though heavy modifications have managed to keep the plane flying into its sixth decade of service, corrosion and age have inflated maintenance costs to troublesome levels. The tanker fleet was originally designed to support Strategic Air Command’s storied bomber force, giving long range B-52s the legs to hit targets deep inside the Soviet Union. Since the end of the Cold War and the rise of America’s new role as chief custodian of global stability, the refueler armada has been tasked with a much broader mission.
America projects military power through two key avenues—air and sea. Tankers provide a capability similar to that of aircraft carriers, in that they provide our fighters and bombers the range to penetrate enemy airspace and return. Refuelers allowed B-2 bombers to strike targets in the Middle East from their home base in Missouri and fighter aircraft to loiter indefinitely over hostile territory in Afghanistan. They transport troops and cargo as well as fuel, serving as some of the most versatile assets in the Pentagon’s inventory.
So it is astonishing that it has taken Congress so long to replace a tool critical to America’s far-reaching global responsibilities. Since the 2001 scandal, the fight to replace the aging tanker fleet has grown uglier. After the corruption investigation resulted in indictments for several senior company officials, Boeing reinvented itself, returning to the tanker fight in the mid-2000s with a snazzy new bid. By this time, an alliance of Northrop Grumman and the European Aeronautic Defense & Space Company (EADS) had submitted a bid of their own, ultimately upsetting the heavily favored Boeing to win the KC-X contract in 2008. Boeing protested through the Government Accounting Office, a political bar fight erupted, Northrop Grumman withdrew its bid, forcing EADS to go it alone, and two years later the Air Force is still without its long overdue replacement tanker.
Both proposed aircraft, the KC-30 built on an Airbus model by Northrop-EADS and the KC-767 constructed by Boeing, have a fair claim to the contract. The KC-30 is a larger jet and can carry 20 percent more fuel, 20 percent more passengers, and 30 percent more cargo than its Boeing counterpart. In short, it’s a more capable aircraft. Further, the Boeing 767 is at the end of its service life. That makes it a somewhat dubious replacement given that the KC-X is intended to fly for the next 40 years.
But the Boeing plane has a strong appeal to those in Congress who are interested in both creating jobs and saving money. Their economic argument is powerful. Innovations in refueling technology allow for the 767 to transfer gas more efficiently, and—being the smaller of the two planes—it consumes less fuel than the EADS bird. Smaller size, says Boeing, is an advantage in that it allows more planes to cram into the crowded flight lines on U.S. bases in Asia. And independent studies have found that the KC-767 would be 20 to 25 percent cheaper to own and operate than the Airbus model. Further, Boeing is an American company and the creator of the KC-135, which has proven to be a fantastic aircraft that has lasted far beyond initial projections. Selection of Boeing’s model means that the tanker fleet’s maintenance and logistical jobs would stay in the States instead of being exported to France. These dueling claims, coupled with an uneven developmental history, have turned the KC-X debate into the Gordian Knot of the defense acquisition world.
Fortunately, there is a way to cut that knot. The Air Force tanker force structure is currently an 80/20 split between “big and little” tankers—80 percent little (the KC-135) and 20 percent big (the KC-10 Extender). This strategy was laid out in a time when the KC-10 was still relatively new. Now that jet is creeping up on its fourth decade of service and is beginning to show its age.
With Airbus and Boeing producing capable aircraft with unique advantages, Congress could split the baby with a 50/50 buy from Airbus and Boeing, replacing both the KC-10 and the KC-135. It should also be noted that the Air Force rejected a mixed-fleet replacement for the KC-135 in 2007, claiming that it would unnecessarily inflate costs. But that math is fuzzy and didn’t factor in replacing the KC‑10 as well. With a budget to buy 15 airframes a year, splitting the fleet would force strong competition between Boeing and Airbus to control construction and sustainment costs.
One fact that has emerged from the gnarly world of defense acquisition is that competition is a proven cost-control mechanism. The so-called F-16 “engine wars” during the 1980s ended up saving the Pentagon billions, as did comparable fights over cruise missile and Navy systems contracts. As the KC-X program is projected to last 40 years, allowing for either EADS or Boeing to have a monopoly on logistics, maintenance, and refurbishment, contracts could significantly inflate both the ownership and operation price tag.
Further, this approach makes the most sense from a capabilities standpoint. In 2008, the entire fleet of C‑model F-15s was grounded owing to a structural flaw. As a result, Canada’s limited inventory of CF-18 interceptors had to take over a significant portion of the North American air defense mission. A similar flaw in the new tanker, should we hold ourselves to a single model, could be catastrophic. F‑15Cs have a sole mission: air interdiction. The KC-X will have many. The effects of a grounding would be felt throughout the entire military, and it would instantly reduce the combat capability of the rest of the Air Force fleet, hamper our capacity to transport men and materials to overseas stations, and also restrict the range of Navy and Marine aircraft that rely on Air Force refuelers. Pragmatic redundancy in the military world is never a bad thing; indeed, it is one of the guiding principles of modern warfare.
Given the deep complexities of the KC-X fight, there is no silver bullet here. But both Congress and the Pentagon should be careful to keep the interests of our fighting men and women at the forefront of this debate. A hybrid fleet of Airbus and Boeing planes provides the best solution to a tough problem, both from a cost perspective and—more important—from a capabilities standpoint.
In the end, the real enemy is further dallying. The Air Force needed this jet a decade ago; the longer we wait, the more the overall buy will cost. Crafting a strong, annual competition between Boeing and EADS, replacing both the KC-135 and the KC-10, and swiftly standing up squadrons of new tankers should be a top priority of the new Congress.
John Noonan is a policy adviser at the Foreign Policy Initiative.
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