Air Force bounces US manufacturer for Brazilian competitor
posted at 10:45 am on November 22, 2011 by Ed Morrissey
Let’s start this off by stating that the Air Force may well have had a good reason for disqualifying Hawker Beechcraft from the bid process on a billion-dollar contract for an updated light attack aircraft. If so, though, the reasoning seems to have escaped Hawker Beechcraft and Rep. Mike Pompeo (R-KS), who represents the district in which Hawker Beechcraft is based. The decision will have jobs heading to Brazil, most likely:
The Air Force has notified Hawker Beechcraft Corp. that its Beechcraft AT-6 has been excluded from competition to build a light attack aircraft, a contract worth nearly $1 billion, the company said.
The company had hoped to its AT-6, an armed version of its T-6 trainer, would be chosen for the Light Air Support Counter Insurgency aircraft for the Afghanistan National Army Corps. The chosen aircraft also would be used as a light attack armed reconnaissance aircraft for the U.S. Air Force. …
The decision appears to favor the Super Tucano built by Brazil’s Embraer for the initial contract to supply 35 with the potential for 55 aircraft worth up to $950?million, which does not include foreign sales, the Eagle reported.
Oddly enough, Embraer has been in the news lately. Less than three weeks ago, the Brazilian airplane builder announced that the SEC had begun a probe — for corruption:
Embraer, the world’s third-largest commercial aircraft producer, said it is under investigation by the US Securities and Exchange Commission for corruption, casting doubt over one of Brazil’s top companies. ..
Embraer’s shares dropped nearly 5 per cent on Thursday, falling the most in six weeks, after the announcement, which was included in the group’s third-quarter results statement.
“In response to a subpoena issued in an investigation by the US Securities and Exchange Commission relating to possible violations of the US Foreign Corrupt Practices Act, the company retained outside counsel to conduct an internal investigation,” Embraer said in a filing late on Wednesday, a national holiday in Brazil.
What’s at stake? Oh, a few jobs here and there:
Hawker Beechcraft said it had been working with the Air Force for two years and had invested more than $100 million to meet the Air Force’s requirements for the plane. It noted that the Beechcraft AT-6 had been found capable of meeting the requirements in a demonstration program led by the Air National Guard.
“We have followed the Air Force’s guidance close, and based on what we have seen, we continue to believe that we submitted the most capable, affordable and sustainable light attack aircraft,” the company said.
The company has said that winning the contract would have kept its T-6 production line running after 2015. About 1,400 employees in 20 states – including 800 at Hawker Beechcraft in Wichita – work on the AT-6 and T-6 programs for Beechcraft and its U.S. suppliers and partners.
If Hawker Beechcraft competed for the contract and lost on price and quality, well, that would be the market at work. However, they’re not being allowed to compete at all for the new purchase, even though they already supply the Air Force and had been allowed to work on the new bid without any notice that they would be excluded, wasting the $100 million, which produced a plane that appears to have met the guidelines for the bid. The decision to exclude Hawker Beechcraft from the competition seems curious at best.
Perhaps Congress might want to take a closer look as to why the Pentagon appears to have favored a foreign builder for homeland-security needs over a domestic firm even before the final bid decision. If there is a good reason for the decision, then let’s see it — but if not, let’s see why this decision got made.