Tanker bid update

As the Air Force moves forward in its selection process to replace its aging fleet of aerial refueling tankers, we write to express our strong support for your current acquisition strategy that will result in the selection of one tanker, not two. This selection process must be rigorous and represent a fair and open competition to ensure that the Air Force and the American taxpayer receive a product that provides the best value in meeting the specific needs of the warfighter.

A “split-buy” replacement strategy has been well debated as government, industry and indeed the American public strives to identify the best policy to replace our aging aerial refueling tanker fleet. Under the “split-buy” proposal, the Air Force and the Department of Defense would simultaneously develop, test and procure two tanker aircraft. Proponents assert that this policy would reduce costs through enhanced competition and expand operational flexibility to the Air Force. We find these assertions to be fundamentally flawed.

To the contrary, a process that guarantees the procurement of two tankers removes all benefits associated with a competitive process by guaranteeing business to potential manufacturers. This would eliminate any incentive for these manufacturers to maximize efficiencies in the development of a product that ensures taxpayers and the Air Force the best value. In fact, a “split-buy” approach would likely lead to higher costs to the Air Force over time.

Due to the size and duration of the planned procurement, as well as the anticipated multi-decade service of the new fleet, a true cost assessment of recapitalization must include the initial purchase price as well as the lifecycle cost of operating and sustaining the tanker fleet. According to experts within the Air Force, as well as prominent industry and policy analysts, procurement of two refueling tankers would undoubtedly lead to a dramatic increase in research and development, maintenance, training and infrastructure costs.

If the Air Force moves to retire aging KC-135 “R” and “E” models as well as its KC-10’s, while concurrently phasing in two new tankers, the agency would be forced to shoulder the costs of maintaining five aircraft systems as opposed to four. Loren Thompson, a defense analyst at the Lexington Institute, states that “Sustaining two different lines…would raise the Air Force’s acquisition costs by well over a billion dollars annually compared with just running one line…” At a time when our country’s national debt continues to grow, we must do all we can to ensure that we are utilizing taxpayer resources responsibly.

In addition to increased costs, a “split-buy” scenario will delay delivery of these vital assets. Under the current procurement schedule, the Air Force will acquire between 12 and 14 tankers annually. While officials within the Air Force have expressed the desire to accelerate this schedule to more rapidly replace the current fleet, under a “split-buy,” scarce resources will be divided between two systems resulting in inefficient production rates due to a loss of economies of scale. The result would mean increased tanker modernization costs and a delay in the development and delivery of new tankers.

Lastly, a “split-buy” will compromise the operational flexibility of the Air Force. Under this proposal, the Air Force would be forced to coordinate the utilization of a fleet of tankers with vastly different capabilities, operational requirements and infrastructure needs. This would exacerbate already existing logistical challenges and compromise the agility of the Air Force in responding to rapidly evolving conditions and needs. These inefficiencies would reduce the safety of our service men and women and that is simply unacceptable.