No Plausible Reason To Ignore WTO Ruling From Tanker Contest

It is inconceivable to suggest that the USAF will not take into account the WTO ruling on the KC-X tanker contract - the only reason to discount it is because EADS wishes to deflect attention from the WTO ruling that has bigger implications for the European complaint against the USA.

 

However, the business rationale behind the A330’s existence is one that the USAF simply cannot ignore.

 

Irrespective of the lobbying by various pro-Boeing senators, isolating the WTO ruling from the KC-X tanker RFP shows that the very basis for a level playing field is jettisoned into obscurity at a time when Airbus and the EU seek clarity against Boeing.

 

How can you seek clarity when “dirty dealings” are seemingly cast aside?

 

As the old adage goes, there is no smoke without fire.

 

With Airbus still seeking (and getting) public funds for the A350XWB, Ron Kirk (USTR) has made known that he’ll push further complaints against such moves – thereby forcing the WTO into assessing Airbus’ continual breaches of funding on its rulings as well as looking more unfavourably against the European complaint against the United States.

 

Of course the problem is that a level playing field for the KC-X can never be fair.

 

Claims and counter-claims of suspect money trails have put paid to that. Put mildly, everyone has tainted hands and its little wonder that over half a decade after talking up a new aerial refuelling tanker, the USAF is the party that has lost out more than anyone else.

 

Suggestions that Boeing is by stratagem or otherwise trying to influence the WTO ruling has minimal consequences – particularly if the KC-X RFP calls for “big” solution – the EADS/Northrop Grumman team simply have nothing to trounce the KC-777. The bigger question that should be asked is why the WTO ruling should be discounted – even if only one part has been published.

 

The USAF may state that the ruling is “not being considered” as part of the RFP, but one could easily ask the question why they didn’t simply wait until the WTO ruled on the European complaint – allow parity for both rulings to emerge and then issue a new draft proposal. The USAF has waited this long already, another six months to wait for the second ruling would not have made much difference.

 

Despite the USAF claiming that the initial ruling will not be taken into account, the reality is that it will be – this allows for procurement on a sole-source basis that protects national interests ahead of external competition. It all but closes the door on further protests and provides the mechanism the USAF seeks to draw a line under this contractual mess and rush through a decision early next year.

 

At the same time, pro-Boeing senators will likely use any victory to launch a salvo at the Europeans for not opening up the calamitous A400M transporter to a contest when many EU governments have been forced to stump up more funds for this oft-delayed airlifter.

 

(It will not be lost on the USAF that some A400M customer nations have acquired Boeing C-17’s in the interim.)

 

Call it “evens” – it may as well be, because that is the only scenario that will “absolve” all parties concerned.

 

The WTO is forever tarnished whomever it rules for/against.

 

The USAF is scarred with KC-X tanker quandary.

 

Airbus and Boeing are both "guilty" of circumventing public funds for other projects.

 

The USAF has the impetus, ammunition and justification to ending this saga – if it chooses not to, then it has only itself to blame if the winning party is tortured by yet another protest to the GAO.