LONDON — British defense procurement officials are facing fresh questions about their plan to buy Boeing Wedgetail E-7 airborne early warning aircraft for the Royal Air Force without holding a competition.
At issue is whether the government is rightfully leaning toward sole-sourcing the U.S. contractor's offering over a European-made system consisting of Saab's Erieye radar and an Airbus 330 airframe.
In one of two letters released late Oct. 17 by the parliamentary Defence Committee, Saab United Kingdom boss Andrew Walton rejected the Ministry of Defence’s argument that marrying the company’s sensor with the Airbus plane would pose a problem. Instead, he explained, the combination would represent the “lowest risk” of any platform on which Erieye has been placed.
The Saab letter was made public alongside a missive from panel Chairman Julian Lewis to Defence Procurement Minister Stuart Andrew. That letter poses several questions about how the MoD reached its decision to move forward with a plan to sole-source the Wedgetail when the ministry lacked detailed information on the A330-Erieye combination.
In particular Lewis wanted to know why an offer from Saab to supply classified technical information relating to the performance of Erieye was declined by the RAF and the Defence Equipment and Support organization.
It’s highly unusual, if not unprecedented, that a letter publicly refuting the procurement reasoning of the MoD and its officials is published.
If the deal with Wedgetail goes ahead, it will be the latest in a string of contract decisions made in favor of foreign companies without holding a competition. That is raising industry concerns.
At least one further major, single-source deal is waiting in the wings for approval.
Saab’s Walton used his letter to defend the company’s ability to meet MoD timelines.
“Detailed analysis indicates that it would take less than 36 months to integrate the first A330-Erieye system and subsequent platforms would follow at nine-month intervals,” the executive wrote.
The Swedish company would lead the integration effort. The Saab letter said the first A330 integration would take place in Madrid, Spain, where Airbus has a military aircraft facility, but the remainder of the aircraft would be modified in the U.K.
Boeing has made a similar undertaking in its effort to generate work locally on any Wedgetail purchase.
Industry executives said the U.S. company plans to undertake conversion of the 737 airliner to a Wedgetail configuration at the Cambridge base of Marshall Aerospace and Defence Group.
With a fast-decaying airborne early warning capability, caused in part by long-term underinvestment in the RAF Sentry E-3D fleet and a changing threat environment, Britain wants the first aircraft in the hands of the military during 2022.
About five aircraft are thought to be required for the aerial surveillance role by the RAF in a deal that could be worth in excess of $2.6 billion.
The MoD announced last month it was opening discussions with Boeing over a possible single-source deal, though officials are leaving themselves wiggle room by saying a final decision has yet to be made.
The British already fly the A330 in the tanker/transport role, and it is thought at least some of the platforms for any AEW proposal would come from the pool of 14 platforms owned by Airbus, but operated by the RAF, as part of a long-standing private finance initiative deal. A handful of those aircraft are available in the charter market and are only operated by the RAF when surge capacity is required.
The Swedish company said it had never failed to integrate the AEW system despite supplying Erieye to eight air forces, using five different platforms.
Saab is currently integrating a new extended-range version of Erieye on a modified Bombardier business jet for the United Arab Emirates, and the letter says Saab is in advanced negotiations for another AEW customer.
The letter from Walton was made public following testimony to lawmakers earlier Wednesday by Defence Secretary Gavin Williamson and other defense leaders. Williamson and his officials told the committee that Wedgetail offered an opportunity to deliver the best capability at the earliest possible stage.
Air Vice Marshal Knighton, the British assistant chief of the Defence Staff for capability and force design, labeled the combination of the A330 and the Erieye a “paper aircraft” and said the system had particular integration challenges relating to the size of the wing of the jet.
“Because of the size of the wing, the A330 requires two radar antenna on top of the aircraft [rather than one]. It’s going to require complex integration to ensure you can unmask the radar from the wings; none of this has been done before," he told the committee. "The risk isn’t in the aircraft but the integration — that’s the challenge.”
It’s the second time in a week MoD officials have used the integration risk to justify not holding a competition.
Last week, Lt. Gen. Mark Poffley, deputy chief of the Defence Staff for finance and military capability, told the committee: “We have analyzed a series of options, including one from Airbus with Saab, and that has led us to the conclusion that we ought to pursue the implications of going single-source.”
Poffley appeared to point the finger at Airbus for some of the integration doubts.
“For the purposes of Airbus, it is about their ability to deliver in the time frames and to mitigate many of the risks we believe are inside that solution. We think we therefore need to pursue single-source,” he said.
“If you think about what we are trying to do here, it is to take a radar, some communication equipment and some aircraft systems, and integrate them inside an aircraft. That aircraft then has to be certified, and with complicated software programs of this type, our experience of all of that has led us to believe that even in the most optimistic of circumstances, the time frames are unlikely to meet where we think we need to be in order to counter the threat,” Poffley said.