Air Force Puts An End To Hawker Beechcraft’s Abuse Of The Acquisition System

Finally, mercifully, the U.S. Air Force has put an end to the farce that Beechcraft Corporation (formerly Hawker Beechcraft) was making of the effort to build a Light Air Support (LAS) aircraft. Having twice lost full and open competitions against Sierra Nevada Corporation (SNC) teamed with aircraft manufacturer Embraer, and in so doing necessitating a nearly 18 month delay in the program, Beechcraft tried once again to subvert the process by lodging a new protest before the Government Accountability Office (GAO). Responding to this new delaying tactic, the Air Force pulled out its heavy contracting guns, shutting down the protest process, declaring that “unusual and compelling circumstances that significantly affect the national security interests of the United States and its coalition partners will not permit waiting for a GAO decision.” The unusual and compelling circumstances to which the Air Force referred was the need to ensure that the LAS was produced and deployed with the nascent Afghan Air Force prior to the end date for Operation Enduring Freedom which is December 31, 2014.

The fact that the Air Force was willing to take this unusual step reflected its confidence that the SNC offer, although more expensive than the price proposed by Beechcraft, provided the best value to the government. Applying a best value criterion allows the Air Force to consider such factors as maturity of the two competing offerings, past performance of the competitors and the relative risk both posed in meeting the tight timelines of the LAS program. In terms of these best value factors, Beechcraft was clearly second best.

Implicit in the Air Force’s rejection of the proposal process was a judgment that Beechcraft’s attempt to assert that its offering was superior as well as lower in price was untrue and that the company could not be relied on to actually perform the work. To anyone who has followed the LAS controversy this should not come as a surprise. From the start Beechcraft had attempted to pass off its aircraft, a light attack variant of its T-6 trainer, as a non-developmental platform, a core contract requirement. Unlike Embraer, which has already delivered several hundred Super Tucanos to more than half a dozen air forces, Beechcraft only built 2 demonstrator versions of the AT-6. At the time of the second award, even with an extra year to develop and test the AT-6, Beechcraft still had not demonstrated that its aircraft could deliver the required ordnance or operate safely and effectively while carrying a under wing gun pod.

Beechcraft not only attempted to fob off on the Air Force an inferior product but sought to mischaracterize its competitor in order to hide the fact that it was a high risk choice to build the LAS. Beechcraft emerged from bankruptcy only last month, having sold large portions of the original company. While its finances are better than when it entered the process, they are not demonstrably adequate to ensure that the firm can manage both the technical, schedule and production issues associated with fielding the AT-6 on the required time line. As it struggled to overcome its financial meltdown and the ensuing bankruptcy, the company let go some 5,000 workers and close multiple facilities in the U.S. At the same time, it moved much of its current operations to Mexico. Furthermore, the former Hawker Beechcraft has a history of failing to meet various contractual obligations, including the delivery of aircraft parts, with such companies as Airbus and Pilatus. In addition, in its bankruptcy filings, Beechcraft sought to renege on warranties and other support obligations for its discontinued business jets.

The sad fact is that by repeatedly seeking to overturn the Air Force’s decisions on LAS, Beechcraft demonstrated that it was pursuing its own selfish interests, rather than what was best for the Afghan Air Force, the U.S. government and the American taxpayer. Beechcraft behaved as if the LAS contract was a government bailout.

Once considered the likeliest candidate to win the LAS competition, Beechcraft is now a mere shadow of its former self. It couldn’t even provide a completely functional AT-6. Its footprint in the United States has declined and work has been shifted overseas. Having permitted Beechcraft two bites at the apple, it made eminent sense for the Air Force not to award the LAS contract to a company that posed a continuing high risk. Hopefully, Beechcraft will be able to improve its financial position and credibility before the competition to replace the Air Force’s T-38 trainer takes place.