Why the fuss about the EADS Boeing tanker order?
If you've been following the news over the past few days, you may have learned that congress and Americans alike are up in arms about the Air Force's recent contract with the European Aeronautic Defense and Space Company (EADS), parent company to Airbus, to manufacture the next generation of their airborne tankers.EADS recently outdesigned and outbid local favorite Boeing on the contract to win the 40 billion deal. The job is purported to create over twenty thousand jobs in Alabama and Kansas, while over forty thousand jobs would have been created (or retained, rather) at Boeing.
This is what has got so many Americans angry. But don't be so quick to jump on the bandwagon. Here are a few points to consider before you start burning your stockpile of french fries, crepes and berets:
- The US Airforce chose the aircraft that would work best for the armed forces. The two competing aircraft were compared based on five criteria, and in each of those categories, the EADS aircraft was superior to the Boeing. All of them.
- The armed forces are required by law to not consider jobs created or lost in their selection process. A law called the Buy America Act also stipulates that they must hold several EU nations in the same manufacturing regard as the US. So even if they wanted to discriminate against workers in Europe or America, they couldn't.
- EADS, and thus Airbus, is not a French company. It's a European conglomerate with multiple countries sharing ownership.
- Competition is good! If we didn't have two large airframe designers in the market, the resulting monopoly could result in poorly made, expensive machinery.
What irritates me is how politicians, bureaucrats and line workers paint the picture of the Air Force hating America and our troops because of this contract. As one union worker on NPR complained:
"It's not the best. Boeing makes the best aircraft in the world. Not Airbus. Airbus makes cheap crap."
We're still creating jobs in the United States with this contract. We're also finding the best, most cost-effective way to update our aging tanker fleet. Boeing, and our economy will survive.
Check out the NPR Morning edition article for more info.













Reader Comments (Page 1 of 1)
Mar 7th 2008 @ 11:29AM
eugene said...
You're arguing reason and logic over emotion and rhetoric. Maybe in another time and maybe if the economy were better, but right now, americans are tired of watching "their" jobs go overseas and they're tired of watching Big Business take billions of dollars in tax credits and subsidies from the Government all the while laying off workers and closing factories.
Of course, most Americans won't accept their OWN culpability in the flight of US jobs. How many of them make it a point to check for and buy the Made in the USA label?
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Mar 7th 2008 @ 12:15PM
harry said...
Grant makes valid points but seems to have missed the point that has garnered most of Boeing's ire: the requirements for the tanker seem to have been changed in what can only be compared to a classic "bait and switch" scenario.
Boeing's has released some of their communications with the Air Force and the Air Force's subsequent response. You can read them here:
http://seattletimes.nwsource.com/ABPub/2008/03/05/2004263239.pdf
With your engineer's viewpoint it should be plain to see that the Air Force decided to change the rules of the game well after Boeing and Northrup/EADS submitted their proposals.
I certainly don't claim to know how the five criteria were weighted, or if the two criteria mentioned within the Boeing letter were even part of the five criteria mentioned in the original post. However, I think everyone should be at least a little suspicious when last minute changes seem to favor one competitor over another.
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Mar 7th 2008 @ 7:09PM
iomatic said...
It's a Northrup Grumman subcontract anyway.
End of story.
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Mar 8th 2008 @ 8:09PM
Walt said...
Whats al this TALK about Northrup WINNING the Bid for the US Air Force Tanker?
Let's call a spade a spade. It is EADS (European Aeronautic Defence and Space Company EADS N.V. (EADS) is a large European aerospace corporation,)
These planes will be assembled using EUROPEAN LABOR (then SOME US content added in the US), paid for USING OUR TAX DOLLARS. Boeing builds in THE USA using US Labor in their Plants in Everett Wa.
Whatever Happend to "Buy American"???
Walt
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Mar 8th 2008 @ 10:23PM
Silk said...
Everyone needs to stop with the bait and switch argument. It is something Norm Dicks came up with to garner support from the ill-informed. A hand written, undated note written by a Boeing employee is evidence the fix is in? Maybe it was just his opinion as opposed to anyone from the Air Force actually making that statement. Read all the correspondence from the USAF to the contractors. They are very careful what they write and what they say. It is very unlikely someone from the Air Force made that statement to Boeing.
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Mar 9th 2008 @ 9:38AM
George Harrison said...
""Everyone needs to stop with the bait and switch argument. It is something Norm Dicks came up with to garner support from the ill-informed.""
Everyone needs to remember how we got to this point. Boeing had the contract until they were caught bribing Air force Officers. Several Boeing and Air force Officers are now in jail and the contract was put back out for bid. I think the Air force bent over backwards to prove they weren't on the take. A little additional punishment for Boeing for being crooks.
Mar 9th 2008 @ 12:29AM
Chris said...
Although we are losing the contract to the AirBus...in which if you are not going to be an A&P mechanic as I am...they are going to build a plant in Mobile, AL where they will assemble the planes. To top it off this contract goes into effect in oh about TEN YEARS...which means there are 10 more years of jobs to last till these plants open up which will create jobs.
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Mar 9th 2008 @ 4:40AM
Alberto said...
I have been working in an aerospace NATO-funded institute for years, and we used sometimes to have discussions between EU and US collegues.
Grant, you are an engineer who seemed to me to have opened his mind travelling. And your post reflects this. So I'd like to join the conversation.
I think in the near future we will see more the US buying EU made products (with US sub-contractors).
I think this is a consequence of 2 facts.
The competition coming from asian countries. US and EU need to "work together" unless they want to be bought by asian capitals. Which is anyway something to be considered acceptable in an open, globalized market. But still I think in an open, global market, western countries should have their own big industries, It would be better for competition.
Secondly, time have changed. For years, in the post WW2 period, EU countries bought US made products in this field. And many excellent european engineers (from Germany, Italy etc..etc..) made the fortune of R&D departments in US organizations and industries. It was logical at the time: you won the war, you gave lot of money to some EU countries, therefore we bought american. But since the 70s in the EU we first had the consortium which created the Tornado, then Airbus and now a growing and growing ESA. With respect to ESA, consider that now it has 1/4 of NASA budget, but summing up all the budget of the national space agencies, still existing as separate entities, the budget overcomes the NASA budget.
Concluding, EU aerospace industry is growing. I hope it will work more and more with US industries to face the globalization challenges. But I am afraid of nationalism. At my institute, US cut part of the budget because they say we are working for Airbus with their money. What a miserable conclusion. US engineers bring a different culture and way of working to our Institute, and get the same from EU collegues.
this will spark the EU nationalism, which want a strong EU separated from US. Which I dont't thing is good. For the similarities of cultures, higher than with asian countries.
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Mar 9th 2008 @ 11:47AM
David said...
There is a lot of talk about Boeing being the victim of the Air Forces decision on EADS getting the contract for the new Tanker. The Air Force also has a KC-10A tanker which is an aircraft made by McDonnell Douglas which is a DC-10 Series 30CF. Was there an out cry of jobs being lost to this aircraft?
We talk about BUYING AMERICAN, but do you realize how much of any US made aircraft are made up of parts from many Foreign Countries.
We as a people have the mind set of wanting to earn the most money we can while spending as little as possible for the goods we buy.
Welcome to out sourcing.
Until we arrange our priorties on how we buy and restore our Country to the One it once was, we will go where products are cheapest.
Let us be grateful that there will be new jobs created by this contract and put our people back to work.
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Mar 9th 2008 @ 6:26PM
Tom said...
"Everyone needs to remember how we got to this point. Boeing had the contract until they were caught bribing Air force Officers. Several Boeing and Air force Officers are now in jail and the contract was put back out for bid."
______________
I don't know ... but the original 'lease contract' from Boeing was for $22 billion, McCain saved us "6 billion" by exposing the deal, and now we have a $35 to 40 billion contract where MOST of the work will be done abroad. My math is better than Huckabee's and I smell a rat.
As a taxpayer, 'bait-and-switch' seems like a good term.
Tom
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Mar 10th 2008 @ 10:09AM
Bob McCarty Writes said...
One great American, Medal of Honor recipient Hershel "Woody" Williams, thinks the Pentagon snub of Boeing was a terrible decision, and I agree. Why? In part, because I trust Boeing employees -- including many friends and neighbors -- far more than I trust any individual, corporate or government interests in France or the European Union. Congress needs to revisit and reverse this decision immediately.
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Mar 11th 2008 @ 6:08PM
John Manley said...
The question is this, how many of these crying babies drive foreign made/foreign owned cars? They probably dont care about the jobless rate in Mich. or Indiana. Oh yeah the last US owned cell phone manufacture is going down the tubes also.
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Apr 3rd 2008 @ 10:15AM
Steve said...
50 years of experience means nothing to me when most of it was spent with little or no competition. That to me equals lazy entitlement, which is exacly what I am reading between the lines of this silly, emotional appeal by Boeing. I'd love to have an X-ray device right now to see who on this posting are driving imports because Detroit auto makers got lazy and sold their souls to corrupt unions while ambitious foreigners left them in the dust.
Duncan Hunter and many conservative pundits such as Hugh Hewitt have bought the Norm Dicks and Patty Murray sob story hook line and sinker. I heard nothing from them back when we were getting fleeced by the corrupt sweetheart leasing deal that caused this whole competition in the first place.
Boeing will lose no workers from this - the unions will make sure of that. Let them worry about getting the planes they already have on back order built. The Northrop model will be the biggest increase in US jobs in the end, and it will re-vitalize an entire region of the US that really needs this.
Buy American - indeed.
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Apr 15th 2008 @ 2:18PM
Lou Totilas said...
Grant,
When did the Air Force allow you to see the specs to make your comments? There's more than just playing the quote game; experience must also be taken into account. Boeing has over 50 years experience in building tankers. How many does Airbus have? Also with the falling dollar the so-called price-performace ratio is changing day by day. In the end it's absolutely foolish to not support our own defense manufacturing. When war breaks out what are we going to do, send out P.O.'s and hope someone sells us weapons to defend ourselves?
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