Boeing faces the loss of at least $5 billion in backlogged defence contracts awarded unfairly by a biased former US Air Force acquisition official, according to new recommendations by congressional auditors. The US Government Accountability Office (GAO) is urging USAF officials to recompete major portions of the $2.7 billion Small Diameter Bomb (SDB) contract and the $4.2 billion C-130 Avionics Modernization Programme (AMP) contract.
Both deals were awarded to Boeing under the tenure of former principal assistant secretary of the air force for acquisition Darleen Druyun, who is now serving a jail sentence for job-hunting with a Boeing executive while making contract decisions. The GAO and the Pentagon's Inspector General are still investigating several other contracts for similar violations. The GAO auditors have found that Druyun personally amended contract requirements to favour Boeing's proposal over other competitors.
In the SDB example, the GAO says Druyun deferred a requirement for attacking moving targets knowing that Boeing's rival in the competition - Lockheed Martin - had the edge. Lockheed had already flight-tested the PNAV guidance system that would allow its SDB candidate to receive updated target coordinates during flight. Boeing's proposal is based on introducing the same capability in 2006. USAF officials have accepted a GAO recommendation to recompete the $1.7 billion SDB Phase 2, which is focused on delivering the moving target attack capability after 2006.
For C-130 AMP, the GAO is taking a more punitive line, urging USAF officials to recompete the roughly $3.3 billion installation phase of the contract, which is currently in a troubled $900 million development phase. The GAO also is recommending USAF officials should study recompeting the entire contract, including relaunching development.
Meanwhile, Boeing chief executive Harry Stonecipher attended the roll-out of the first of four 767 tanker aircraft ordered by Italy in Wichita, Kansas on 24 February. Boeing needs guidance from USAF officials before mid-year on the fate of the KC-767Atanker programme in order to preserve the 767 production line beyond 2007, he says.
STEPHEN TRIMBLE / WASHINGTON DC
Source: Flight International
