Northrop Grumman Playing Chess with Bomber Bid? Or Poker?

Northrop Grumman is not saying whether it will compete in the U.S. Air Force’s Long-Range Strike – Bomber program.

Boeing and Lockheed Martin have announced that they will be teaming up to pursue the contract, with Boeing as prime and Lockheed as chief teammate.

“Northrop Grumman views the Long-Range Strike Bomber program as vital to both national security and the power projection capability of the U.S. Air Force,” the company stated. “We do not comment on other companies’ business arrangements and have no further comment on the program at this time.”

The move is surprising, because Northrop has been publicly promoting its qualifications to build the Air Force’s next bomber for more than a decade, based on its experience with the B-2 program. The company continued that campaign through September’s Air Force Association show via advertising and the release of a specially commissioned book about the B-2’s history. But the defense manufacturer elected to no-bid the final stage of the USAF tanker program after investing many years and a great deal of money into its Airbus A330-based proposal.

Even a threat of a no-bid decision puts the Pentagon in an awkward position, because it would turn a program valued at well above $60 billion into a sole-source Boeing effort – which would likely draw widespread scrutiny and some outright opposition in Congress.

One observer notes that Northrop Grumman may be pressuring the Pentagon into more generous funding. The Pentagon is proposing a development program in which cost-reimbursable line items (that is, non-fixed-price) would be limited to areas where the government sees risk, while incentive payments will be tied to tangible deliverables rather than paper milestones. Senior Pentagon leadership expects to supervise a “should cost” process, controlling the release money to the program office.

Alternatively, Northrop Grumman may be looking to level the playing field if – as has been reported – Lockheed Martin is already building an LRS-B-related demonstrator. This would be a replay of the early history of stealth, where Northrop (in 1979) initially declined to bid on what became the B-2 until it was sure that the requirements would not favor Lockheed, which had already flown the Have Blue stealth prototype and was under contract for the F-117.

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