767 Deal Just Looks 'Too Good'

When Boeing started facing rapidly-downramping airliner deliveries, and its 747X was stillborn, and the Sonic Cruiser didn't get off the table, the company had a look at potential markets and found that the Air Force was still flying 707s, er, KC-135s.

They're old, although their airframes don't have a lot of time or cycles on them. Corrosion and spare parts could be a factor.

So, the company must have asked the USAF to have a closer look at the fleet: the priority of replacing the 40-year-old machines suddenly shot up from nowhere to a top priority. Additionally, the KC-135 fleet, the AF discovered, was subject to a 'fleet-grounding event,' a scenario where a heretofore-undiscovered problem in the well-proven machines would suddenly and catastrophically ground most of the refuelers. [The USAF has a few DC-10-based tankers, too --ed.]

Boeing had a great deal in the works, as luck would have it: a lease deal that would allow the Air Force to get its 767-based tankers aloft a year or two quicker than a purchase would.

Just as if you were buying a car, though, it's a good idea to check to see if the lease is the more-expensive option. By all counts, it was. Those counts, though, varied quite a bit, as to just how much extra the taxpayers would be sending to Boeing under the lease agreement. ANN has reported on OMB reports that showed well over a billion dollars worth of differences...

Reuters now reports that Boeing may face congressional subpoenas, so that Senator John McCain, among others, can get a better look at just what machinations may have gone on between Boeing and the Air Force. The report says, "McCain has also asked Air Force Secretary James Roche to hand over all records of his dealings on the plan, but Roche had not complied as yet, a McCain aide said. Pentagon officials say they will not provide emails to McCain's committee because they are 'pre-decisional.'"

Allegations of impropriety have already surfaced, especially regarding a former USAF purchasing official who was recently hired by Boeing. She may have shared Airbus's bidding information with Boeing, so the buzz goes. A retired admiral and a retired AF general, lobbyists for Boeing, are also coming under increased scrutiny.

The subpoenas, if not quashed by Attorney General John Ashcroft, may shed additional light on whatever shenanigans might have been going on. Stay tuned.

FMI: www.boeing.com; www.af.mil