Northrop offered more with less

The Northrop Grumman-EADS aerial tanker beat Boeing's plane for a $40 billion program in part because fewer of the aircraft would be required to meet wartime missions and it may be ready sooner, according to U.S. Air Force documents.

The service would require 22 fewer Northrop-EADS tankers to meet classified homeland-defense and combat scenarios covering the Pacific and southwest Asia required in the competition, according to a document that outlined the service's selection criteria.

Boeing lost the 179-plane program Feb. 29 to Northrop and its partner — European Aeronautic, Defence & Space (EADS) — and protested the decision March 11.

The Air Force briefing document made available to Bloomberg News indicates that while the contest was close, the Air Force decided the Northrop-EADS entry was better in some key areas such as turnaround time on refueling missions.

The Air Force determined the Northrop-EADS plane was likely to need less development time to meet the goal of an April 2013 introduction, the document said.

Both bidders "offered fair and reasonable prices" and "a reasonable business arrangement," the briefing document said. Northrop-EADS was deemed "more advantageous in mission capability" and "in key system requirements' and "program management," the document said.

Boeing's entry in the latest contest was based on its 767 commercial plane, while the Northrop-EADS proposal was based on the larger A330 made by EADS unit Airbus.

Boeing spokesman Bill Barksdale said the company was given the document with selected Northrop-EADS material redacted. Northrop spokesman Dan McClain confirmed his company also received the document with Boeing data deleted and declined further comment. Lt. Col. Jennifer Cassidy, an Air Force spokeswoman, also declined to comment.

Barksdale said in an e-mailed statement that "many of the facts in the brief don't support the conclusions."

"In the areas of aerial refueling, airlift, aeromed evacuation, survivability and operational utility, our KC-767 Advanced Tanker had significantly higher numbers of positive attributes," Barksdale wrote.

The documents said Boeing's candidate had better communications capability and bested Northrop-EADS in some aerial-refueling capabilities. The Boeing aircraft also was judged to have better survivability characteristics.

Even so, "Northrop Grumman provides better aerial refueling efficiency," said the slides prepared by the Air Force Aeronautical Systems Center at Wright Patterson Air Force Base near Dayton, Ohio. That's because the KC-30, as the Northrop-EADS team calls its model, "can refuel more receivers and provide more fuel per receiver than the KC-767" and its refueling boom connects to an aircraft dispenses fuel faster.

The Northrop-EADS configuration also allowed incoming aircraft a greater flexibility to maneuver as they lined up to receive fuel, helping them stay connected, the slides said.

The Northrop team's lighting for night refueling needed improvement and there were weaknesses in the boom design that could be corrected without cost increases or schedule delays, the slides said.

The Air Force concluded there was more risk that Boeing's development phase would take longer and be more expensive than Northrop-EADS', the slides said. This included the likelihood of a "relatively lengthy software-development phase."

"Boeing has a higher cost-price risk on a larger system design and development program" over what it bid, the slides said, while the Northrop-EADS team's cost was considered "low risk."

"Little difference exists between" Northrop-EADS's "cost and price and the government's probable cost and price" for the development phase, the Air Force said.

In contrast, the difference between Boeing and the government's probable costs "are not reasonably explained" for some categories.

Barksdale in his e-mail statement said problems Boeing had with some international tanker programs and a Navy multi-mission aircraft were "overly emphasized" and that the Air Force didn't properly consider "lessons learned" by the company in resolving those issues.

Among the "major discriminators" that swayed the Air Force was the Northrop-EADS model's larger size. The KC-30 was "more advantageous" than Boeing's aircraft because the double-decked aircraft can carry more passengers, patient litters for medical evacuation and cargo pallets, the Air Force said.

Boeing, in its protest to the U.S. Government Accountability Office, said if the company had been told "the Air Force wanted a large-scale tanker, it could have offered" the bigger 777 as a base.

The GAO has 100 days from the March 11 filing to decide whether the contest was fair.