Air Force KC-X Tanker Aircraft Program: Background and Issues for Congress

Jeremiah Gertler
Specialist in Military Aviation

On February 24, 2010, the Department of Defense (DOD) released its Request for Proposals for a program to build 179 new KC-X aerial refueling tankers for the Air Force, a contract valued at roughly $35 billion. 

On March 8, 2010, the team of Northrop Grumman and the European Aeronautic Defense and Space Company (EADS) announced that they would not bid for the contract, leaving Boeing as the only expected bidder. DOD then extended the bid deadline by 60 days, to July 9, 2010. Subsequently, on April 20, 2010, EADS announced that it would submit an independent bid for the KC-X contract. Boeing will offer a KC-X design based on its 767 airliner, to be built in Seattle, WA, and Wichita, KS. EADS is expected to offer a KC-X design based on the Airbus A330 airliner, to be built in Mobile, AL. 

The KC-X acquisition program is a subject of intense interest because of the dollar value of the contract, the number of jobs it would create, the importance of tanker aircraft to U.S. military operations, and because DOD's attempts to acquire a new tanker over the past several years have ultimately failed. DOD's proposed new KC-X acquisition competition strategy poses several potential oversight issues for Congress, including the following: Has DOD adequately defined the required capabilities for the KC-X and established a fair and adequate framework for scoring and evaluating bids against those required capabilities? Should a March 23, 2010, World Trade Organization (WTO) ruling on commercial aircraft subsidies be taken into account in evaluating the KC-X bids? Should Boeing's pricing data for the 2007-2008 KC-X competition be shared with EADS in a manner equivalent to how Northrop/EADS' pricing data for the 2007-2008 competition was shared with Boeing? Should the Air Force be in charge of the new KC-X competition? If there is only one bidder, how will DOD determine an appropriate price for the tankers and control costs throughout the program? 

FY2010 defense authorization bill: The conference report (H.Rept. 111-288 of October 7, 2009) on the FY2010 defense authorization act (H.R. 2647/P.L. 111-84 of October 28, 2009) authorizes the Administration's request for $439.6 million in Air Force research and development funding for the KC-X program. Section 1081 of the act amends Section 1081(a) of the FY2008 defense authorization act (H.R. 4986/P.L. 110-181 of January 28, 2008) to require the Secretary of the Air Force to conduct a pilot program to assess the feasibility and advisability of using commercial fee-for-service air refueling tanker aircraft for Air Force operations, unless the Secretary of Defense submits a notification that pursuing such a program is not in the national interest. Section 1082 provides the Secretary of the Air Force authority to use multiyear contracts to conduct the pilot program described in Section 1081 of the FY2008 defense authorization act. 

FY2010 DOD appropriations bill: In lieu of a conference report, the House Appropriations Committee on December 15, 2009, released an explanatory statement on a final version of H.R. 3326. This version was passed by the House on December 16, 2009, and by the Senate on December 19, 2009, and signed into law on December 19, 2009, as P.L. 111-118. 

The bill establishes a Tanker Replacement Transfer Fund in the amount of $291.7 million. In lieu of a conference report on H.R. 3326, the House Appropriations Committee on December 15, 2009, released an explanatory statement on an intended final version of H.R. 3326. The explanatory statement provides $15 million for management of the tanker program.


Date of Report: May 14, 2010
Number of Pages: 69
Order Number: RL34398
Price: $29.95

Document available via e-mail as a pdf file or in paper form.
To order, e-mail Penny Hill Press or call us at 301-253-0881. Provide a Visa, MasterCard, American Express, or Discover card number, expiration date, and name on the card. Indicate whether you want e-mail or postal delivery. Phone orders are preferred and receive priority processing.