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June 14, 2012—
As part of the KC-46A tanker program, the Air Force will pay for the development, fabrication, and test of an interim aircraft that Boeing hopes to market as a commercial product, according to service and company officials.

In the tanker's test program, Boeing will deliver two aircraft as 767-2Cs—a new freighter variant that will lack refueling gear—and another two airplanes configured as all-up KC-46 tankers.

The Air Force doesn't see the situation as evidence that the US military is subsidizing the commercial aircraft industry. That's a charge Europe has frequently lodged with the World Trade Organization.

Maureen Dougherty, Boeing's KC-46 program manager, said in a June 13 interview the 767-2C—which bridges from the 767-200ER to a configuration that the Air Force can use as the basis of the KC-46—is going to be a commercially available aircraft.

However, the 767-2C will be "provisioned" for the tanker conversion, and may not be attractive to commercial customers without changes, said Air Force KC-46 program manager Maj. Gen. Christopher Bogdan.

He told the Daily Report on June 13 that the interim aircraft would have faired-over "holes" where the refueling receptacle, tanker boom, and other military gear will be added later, and would carry the "extra weight" of military wiring and structure.

If Boeing wishes to market the aircraft, "that's OK with us," he said, but one should not construe the arrangement as a subsidy of a commercial project.

The KC-45 offering of EADS Airbus in the KC-X tanker contest that Boeing won in February 2011 also would have required significant redesign, because the version sold to Australia—the basis of Airbus' bid—didn't meet the Air Force's requirements, noted Bogdan.

"When the Air Force decided to pursue a strategy of using a commercial-derivative airplane, from either Airbus or Boeing, we understood that there may be commercial benefits for either offeror, if they were to win," he said.

He added that Boeing's reasons for bidding low on the tanker—a reported $300 million under cost—are its own, but aren't due to a subsidy.

And, "the Air Force got a great deal" on the tanker program, said Bogdan.

He said the flyaway cost target for the KC-46 is pegged at about $188 million a copy.