Airbus beats Boeing in US air tanker deal
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general_kill
Deity
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Good to see a monopoly get some competition. There must be a lack of efficiency at Boeing and if they cannot correct it, then it's their fault.
This doesn't bother me. If Airbus messed up this contract, what do you think would happen to their reputation? If Boeing couldn't compete on this, then they didn't deserve to win the bid.
Plus, as has been noted already, a good portion, if not most or more of it, will be produced here. And if somehow governments in Europe got all uppity and denied parts or anything else, it isn't as if we couldn't get our own in this case. We're not like Iran. We actually have other options.
But because of the extremely low chance that this would get interrupted, why not save some taxpayer dollars?
Plus, as has been noted already, a good portion, if not most or more of it, will be produced here. And if somehow governments in Europe got all uppity and denied parts or anything else, it isn't as if we couldn't get our own in this case. We're not like Iran. We actually have other options.
But because of the extremely low chance that this would get interrupted, why not save some taxpayer dollars?
sonorakitch
Overseas hunter
One fact that has always shocked me is that AirFrance is a big purchaser of Boeing products. They are one of the few to buy some of the next-generation 747's.
Whomp said:
This order is only for 80 aircraft with an *option* to buy another 100. Not big enough to help Airbus recover much. Really, an aircraft order of 80 with a commercial unit isn't an enormous, fabulous, and life changing event. What could happen, though, is this initial overseas order could precede a great deal more foreign supply orders by the US Gov.
__
I think Boeing screwed up, thinking the US Gov. would just lay back and buy an inferior product. The A330 is just better for the job. I do agree that parts hostage could be an issue in the distant future, but remember not a single Boeing product is manufactured wholly in the United States anyways.
Plus, if the French won't sell us hydralic pumps for the KC330, we'll just bomb them from our bases in Germany
.~Chris
MobBoss
Off-Topic Overlord
Well, there is a long history of 'push me, shove you' in this story that we, the general public, are probably not aware.
The US AirForce has been trying to solve its aging tanker fleet for a very long time. Various solutions, such as leasing the aircraft from Boeing as opposed to buying new planes outright either became too problematic, or prohibitively expensive.
Trust me, the Airforce has been trying to deal with Boeing on this for a very long time. Boeing hasnt budged much because it saw itself in the drivers seat on such deals so to speak.
Well, this deal breaks that viewpoint all to hell.
Lesson learned: Should US military contractors use US based companies to supply the needs of the military? Yes, but not to the point where the companies think they can dictate terms to the military itself.
The US AirForce has been trying to solve its aging tanker fleet for a very long time. Various solutions, such as leasing the aircraft from Boeing as opposed to buying new planes outright either became too problematic, or prohibitively expensive.
Trust me, the Airforce has been trying to deal with Boeing on this for a very long time. Boeing hasnt budged much because it saw itself in the drivers seat on such deals so to speak.
Well, this deal breaks that viewpoint all to hell.
Lesson learned: Should US military contractors use US based companies to supply the needs of the military? Yes, but not to the point where the companies think they can dictate terms to the military itself.
general_kill
Deity
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I can't wait to see the hit this will have on Boeing's stock on Monday. It looks like some insider information have been leaked because their stock dropped around 8-10% on Friday. If the market over reacts to this news, we could see a very good investment opening up in Boeing.
Lets not get carried away guys it is a partnership between Airbus and Northrop Grumman.
Northrop Grumman will likely be the ones making most of the military hardware for the plane, which is based on the Airbus A330.
In fact the first story I read was how Northrop had won the contract over Boeing, later mentioning that Airbus was partnering with NG
Northrop Grumman will likely be the ones making most of the military hardware for the plane, which is based on the Airbus A330.
In fact the first story I read was how Northrop had won the contract over Boeing, later mentioning that Airbus was partnering with NG
Winner
Diverse in Unity
Well, gov contracts should be transparent, the best offer should win. Unfortunately, it usually ends up with "this is a matter of our national security, therefore we choose company X over company Z despite the fact that company's X offer is the least profitable."
Americans for once proved that they're willing to do what they like to teach others.
Izipo
Hardcore casual gamer
First of all, thanks for starting this thread, it should be interesting...
Correct. But it was also because the Rafale was also quite advanced at the time... More of a 'don't chase two rabbits' mentality, then.
And yet, our fleet of tankers is entirely American (KC 135), as are our AWACS (as someone pointed out already).
I agree, that's probably the best part of the deal. With the US choosing the MRTT (Multi Role Transport and Tanker), it will sell really well everywhere else. Also, it's a big chance to make a breakthrough in the American defense market.
Although the contract (179 planes) hardly represents 15% of all deals made by Airbus this year (more than a thousand planes), it is a big break, and let's be honest, a slap in the face for Boeing.
And remember that we're allies, so I really don't see a security issue there.
Correct. But it was also because the Rafale was also quite advanced at the time... More of a 'don't chase two rabbits' mentality, then.
And yet, our fleet of tankers is entirely American (KC 135), as are our AWACS (as someone pointed out already).
I agree, that's probably the best part of the deal. With the US choosing the MRTT (Multi Role Transport and Tanker), it will sell really well everywhere else. Also, it's a big chance to make a breakthrough in the American defense market.
Although the contract (179 planes) hardly represents 15% of all deals made by Airbus this year (more than a thousand planes), it is a big break, and let's be honest, a slap in the face for Boeing.
And remember that we're allies, so I really don't see a security issue there.
GrandAdmiral
Deity
I don't think the EU is evil but I'm certainly not happy to see almost 100million go from my hometown the Seattle area to the EU in a single week (including MS case). The companies are to blame but it isn't of zero consequence to the people here.
I also don't think you understand the sentiment that the workers have. The EU didn't steal there jobs but when Boeing loses contracts like this the effect tends to be dramatic for the workers because the city of Everett for example is pretty much built around Boeing. Despite assembling many parts elsewhere Boeing has huge concentration of workers in this region. Before Microsoft showed up the local economy was pretty much dependent on Boeing. The workers don't look at the big picture. To them they have a history and a strong bond with the US military that dates back to WWII and if you ever visit the area it shows. So politician do to an extent need to defend their interests even if they embrace a free market economy.
As much as I prefer the business in the Seattle area Boeing is way too demanding. Washington state pretty much had to pay them billions just to assemble the dreamliner there and this is after decades of the state hosting, subsidizing and placating them. Boeing has been abusing its position in negotiations lately because it thinks nobody can live without their business and they totally screwed up this deal.
Gooblah
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I have to agree with some of the points here. Boeing basically deserved it. Clearly, the US Military saw a lack of efficiency and effectiveness in the company and gave them their reward: no contract. I read about Airbus's proposal: Its bigger, faster, and cheaper. No wonder the military wants one. Anyways, a lot of jobs will be made in Mobile, probably enough to offset the ones that may be lost in Boeing. Plus, Airbus is working with an American contractor. So, I really don't see the problem.
Good to know the Air Force knows where its priorities lie.
Good to know the Air Force knows where its priorities lie.
Masquerouge
Deity
Interestingly, General Electric is also part of the winning team. And EADS said the goal was to have everything made in the US by 2012, which is a win-win since it will alleviate fears of "foreign" intervention and loss of US jobs in a US military project, and save EADS millions by having a factory based in the dollar-cheap continental US.
The signal sent by the Air Force is directed towards Boeing and also the American public, I believe. What they're saying is that they're really looking at the best deal for the US army, not subsidizing Boeing at the taxpayer's expense.
The signal sent by the Air Force is directed towards Boeing and also the American public, I believe. What they're saying is that they're really looking at the best deal for the US army, not subsidizing Boeing at the taxpayer's expense.
Chandrasekhar
Determined
Yes, as someone from the Seattle area, I'd say that this is a good thing, for several of the reasons already described. The taxpayers get the more efficient deal, and Boeing is sent a clear message that they can't throw their weight around to get concessions from the government. Even if it causes some short term local economic problems, it's overall a good thing.
That's always a consideration that has to be taken into account, which ties in to the whole "our companies should do it" opinion. However, if there has been a lot of trouble dealing with Boeing, then if Boeing were to turn around and essentially say "Give it to us or these guys get it," there has to be a point where the Pentagon says no. The cost to keep some of the jobs is far more than what the jobs bring.
It isn't easy, but in the end, the needs of the contract have outweighed loyalty to Boeing.
amadeus
Bishop of Bio-Dome
So, now are you guys going to buy some of our stuff if we can give you a better bid?
Northrup Grumman/EADS offered a better deal, so they took it. All the people on the Hill who are whining about it are just making noise for their constituents.So, what do you think about all this? Is this sudden outburst of economic liberalism going to last? After all, Airbus is European and Europe is evil, because it steals american jobs and threatens US security, as some American politicans say.
Also, how will it affect the Boeing-Airbus rivalry?
Discuss
I don't think Airbus would do that, as that would insure that they wouldn't get a contract with the US DoD ever again. And considering they just landed a $40 billion contract, I think they'll want to keep us happy.
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