The Hon. John Moore, MPMinister for Defence
Wednesday, 21 July 1999 MIN 202/99
The Minister for Defence, John Moore, today announced that The Boeing Company, based in Seattle USA, has been selected
as the preferred tenderer of Airborne Early Warning and Control (AEW) aircraft and associated support for the Australian Defence Force (ADF).
The Department of Defence will now enter into contract negotiations with Boeing with the aim of signing the final
contract in early 2000. The first of seven aircraft is planned to be delivered in 2004/05. Total cost of the project is
expected to be over two billion dollars.
"AEW aircraft offer a strategically important Defence capability for Australia and one that is essential to Australia's
surveillance, early warning and detection capabilities," Mr Moore said. "The Government has recognised that the
procurement of AEW aircraft is long overdue and represents a major development in the Government's commitment to enhance the ADF's combat
capability."
Tenders for the project were sought from The Boeing Company, Lockheed Martin Corporation and Raytheon Systems Company in
September last year after these companies were selected in earlier phases of the acquisition process. During 1998 the
companies were contracted to further develop their designs as a risk reduction measure. "I acknowledge the efforts of
all three companies during the extended competition and compliment them on the quality of their tenders," said Mr Moore.
"Boeing was selected as the preferred tenderer after a thorough evaluation across a range of areas including operational
capability, Australian Industry Involvement, cost and risk."
Boeing and its radar supplier Northrop Grumman have extensive experience with AEW aircraft, notably as manufacturer of the E-3 AWACS operated by the United States, United Kingdom, France and NATO, and
the B-767 AWACS operated by Japan.
The AEW system proposed by Boeing is based on the Boeing 737-700 commercial jet airliner. The surveillance radar being
developed by Northrop Grumman will be state of the art. The AEW's mission system will utilise open systems architecture and commercial off-the-shelf products that should enhance
technology upgrading.
Boeing's Australian partners include Boeing Australian Ltd and British Aerospace Australia Ltd. Other significant
participants include QANTAS and ASTA.
The Minister said Australian industry would be involved in aircraft modifications, design and development of radar and
electronic warfare systems components, radar component manufacture, testing and on-going support of the new aircraft.
There also will be significant Australian industry spin-offs associated with any future aircraft sales by Boeing to
other countries. Boeing proposes to establish an Australian AEW Centre of Excellence.
The AEW fleet will be based at RAAF Base Williamtown in New South Wales, with two aircraft permanently deployed at RAAF Base
Tindal in the Northern Territory. The aircraft will be operated by the reactivated No.2 Squadron, which has a
distinguished history dating back to World War I.
Mr Moore said the Government was determined to ensure that Defence applies the lessons learnt from previous major
procurement projects to the contract negotiation and overall management of the AEW project.
"In line with the Government's policy to improve accountability and management of Defence projects, considerable
emphasis has been placed on risk management in this project by incorporating lessons from the past acquisition projects
including JORN and the Collins submarine.
"These lessons were applied in the source selection and will continue to be applied in the ongoing management of the
project. The project will be headed at the one star level and continuity of personnel will be maintained.
"A project engineering team integrated with the contractor will manage progress on site. Regular reviews will be
undertaken both within the Defence Acquisition Organisation and by the Chief of Air Force as the capability manager.
"I have instructed the Department to brief me quarterly on progress in the project against agreed milestones," Mr Moore
said.