Military

Boeing's Air Force Tanker Program Takes Another Hit

Boeing KC-46A
The Boeing Co.
A badly designed wiring bundle has once again pushed out the first test flight of the new U.S. Air Force KC-46 tanker being built by Boeing Co. (NYSE: BA). The first flight of the baseline 767-2C on which the new tanker is based was originally scheduled for this past June, and a new delay has likely postponed the flight until November. A Boeing official said the first flight of the KC-46 remains on track for April 2015.

Earlier this summer, Boeing took a charge of $272 million to keep the KC-46 program on track following the discovery of a badly designed wiring bundle. Under its contract with the Air Force, the government’s costs for program development are capped at $4.9 billion and Boeing is on the hook for any overage.

While $272 million for a wiring bundle may seem bit steep, Aviation Week points out that the baseline 767-2C includes about 70 miles of wiring. The KC-46 will add 50 miles on top of that total in order to meet military redundancy and spacing requirements. The baseline 767-2C is a version of the 767-200ER modified with a strengthened main-deck cargo floor, cargo door and freighter features, 787-based cockpit, auxiliary fuel tanks and plumbing and wiring to support the refueling boom and mission systems.

The KC-46 tanker is the Air Force’s replacement for the venerable KC-135 tanker that has served for nearly 60 years. Boeing is scheduled to deliver the first 18 tankers to the Air Force by August 2017. The total number of planes Boeing plans to build under the contract is 179, and the total value of the contract has been placed at $52 billion. All the new tankers are expected to be delivered by 2028.

Boeing built a total of 820 KC-135s in the years between 1956 and 1966. Of the total, Boeing’s website shows that 732 were built as tankers and the remaining 88 were modified for special purposes. There are currently 415 Stratotankers still in service.

Boeing’s stock traded down about 0.8% at $126.68 in the mid-afternoon on Friday. The stock’s 52-week range is $109.14 to $144.57.

READ ALSO: What Does a Boeing 767-based KC-46 Cost?

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