Boeing: We Screwed Up, Give us $500 Mil

“When a child who is on trial for mur­der­ing his par­ents pleads for leniency on grounds that he is an orphan, we call that chutz­pah,” says Space News’ Washington Aerospace Briefing. “When a U.S. defense con­trac­tor botches a pro­gram demands a huge ter­mi­na­tion fee when the con­tract is can­celled, we call that… stan­dard oper­at­ing pro­ce­dure.“

So no, we weren’t com­pletely shocked to hear that Boeing is seek­ing about $500 mil­lion from the National Reconnaissance Office in ter­mi­na­tion fees asso­ci­ated with the Future Imagery Architecture spy satel­lite pro­gram. The NRO can­celled the opti­cal por­tion of Boeing’s multi-​​billion dol­lar FIA con­tract last year after becom­ing fed up with the company’s tech­ni­cal strug­gles and that lead to innu­mer­able delays and soar­ing costs.

FIA was sup­posed to be a con­stel­la­tion of satel­lites that would gather clearer and more-​​frequent images — even at night and when there is a cloud cover — of enemy mil­i­tary activ­ity than cur­rent satel­lites can, the Los Angeles Times notes. Originally sched­uled to launch in 2005, at one point, FIA looked like it might become the most expen­sive pro­gram in the his­tory of the intel­li­gence com­mu­nity, accord­ing to Globalsecurity​.org.
When Boeing won the FIA con­tract, back in 1999, it was some­thing of a coup. As the Times observes, Much of Boeing’s space exper­tise was in mak­ing rock­ets to launch satel­lites and devel­op­ing com­mer­cial telecom­mu­ni­ca­tion satel­lites. It had lit­tle expe­ri­ence man­u­fac­tur­ing satel­lites with opti­cal lenses that can take close-​​up pic­tures from space of objects on the ground. That was Lockheed Martins area of exper­tise. Boeing bid very aggres­sively even though it didn’t under­stand the tech­nol­ogy as well as Lockheed,” the ubiq­ui­tous Loren Thompson told the LAT.
So its no sur­prise that Boeing started burn­ing through cash and drop­ping dead­li­nesa, once FIA got under­way. As early as 2002, the gov­ern­ment had to repro­gram­ming of about $625 mil­lion [and pos­si­bly as much as $900 mil­lion] from other intel­li­gence pro­grams to get the pro­gram back on sched­ule, Globalsecurity​.org says. By the end of 2004 the House Intelligence Committee remained con­cerned about the via­bil­ity and effec­tive­ness of a future over­head archi­tec­ture, given the appar­ent lack of a com­pre­hen­sive archi­tec­tural plan for the over­head sys­tem of sys­tems, specif­i­cally in the area of imagery.
By 2005 after $10 bil­lion on FIA, includ­ing about $4 or $5 bil­lion in cost over­runs the gov­ern­ment finally had enough, tak­ing the project away from Boeing, and giv­ing it to Lockheed.
Boeing’s request for a half a B to make up for the lost work is big. But it’s not totally unprece­dented, Washington Aerospace Briefing says. The com­pany is still argu­ing with the Pentagon over $2.3 bil­lion for the A-​​12 stealth car­rier air­craft pro­gram, can­celled in 1991.
(Big ups: AT, JS)
UPDATE 2:28 PM: AT points out that there were some inter­est­ing names asso­ci­ated with Boeing’s con­tro­ver­sial FIA win. In Boeing’s ’99 press release, we read:

Ed Nowinski, Boeing FIA Program Manager, stated, ‘This was a very hard-​​fought com­pe­ti­tion and the win is the result of the total com­mit­ment of our team.’

Who is Ed Nowinski? Check out this press release, from 1996:

MELBOURNE, Florida, August 5, 1996Harris Corporation has named Ed Nowinski as vice pres­i­dent of Strategic Planning and Business Development for the company’s Electronic Systems Sector.
Mr. Nowinski most recently was the direc­tor of imagery intel­li­gence for the U.S. government’s National Reconnaissance Office (NRO) and direc­tor of devel­op­ment and engi­neer­ing for the Central Intelligence Agency.
Mr. Nowinski joined the CIA in 1967 and rose rapidly to posi­tions of increas­ing respon­si­bil­ity dur­ing his career with the CIA and NRO, includ­ing direc­tor of the Data Communications Group, deputy direc­tor of devel­op­ment and engi­neer­ing, and direc­tor of sys­tems engi­neer­ing. During his gov­ern­ment career, he was instru­men­tal in estab­lish­ing sev­eral of the country’s pre­mier intel­li­gence col­lec­tion systems.

February 2nd, 2006 | Money Money Money, Space | 182321 Comments »http://defensetech.org/2006/02/02/boeing-we-screwed-up-give-us-500-mil/Boeing%3A+We+Screwed+Up%2C+Give+us+%24500+Mil2006-02-02+17%3A26%3A22murdoc You can skip to the end and leave a response. Pinging is currently not allowed.