The Air Force seems to have gotten a good deal on its next-generation training system, awarding the program to Boeing for a price that is less than half of what the program was expected to cost. It got a similar deal only days earlier from a Boeing-Leonardo team for helicopters used in securing missile fields. But is there a danger is driving competitively-sourced weapons prices to the lowest possible level? Boeing has barely begun to deliver the Air Force’s aggressively-priced KC-46 tankers, and it already has had to eat billions of dollars in unexpected costs. Northrop Grumman bid so low on the contract to build next-gen bombers for the Air Force that it is easy to imagine the program going haywire once it reaches low-rate production. The Air Force may be paying too much attention to price, and too little to risk. I have written a commentary for Forbes here.
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