{"id":62469,"date":"2022-01-26T17:23:13","date_gmt":"2022-01-26T17:23:13","guid":{"rendered":"https:\/\/one.sightlinemg.com\/defensenews\/uncategorized\/2022\/01\/26\/kc-46-vision-system-problems-lead-to-402-million-charge-for-boeing\/"},"modified":"2026-08-08T00:37:19","modified_gmt":"2026-08-08T00:37:19","slug":"kc-46-vision-system-problems-lead-to-402-million-charge-for-boeing","status":"publish","type":"post","link":"https:\/\/one.sightlinemg.com\/defensenews\/air\/2022\/01\/26\/kc-46-vision-system-problems-lead-to-402-million-charge-for-boeing\/","title":{"rendered":"KC-46 vision system problems lead to $402 million charge for Boeing"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">WASHINGTON \u2014 Boeing reported a nearly 14% drop in its defense business sales in the most recent quarter, driven partly by a $402 million charge on the <a href=\"https:\/\/www.defensenews.com\/air\/2022\/01\/10\/the-air-force-and-boeing-havent-yet-fixed-the-troubled-kc-46-pegasus-vision-system\/\" target=\"_blank\">KC-46A Pegasus tanker<\/a> program.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In earnings released Wednesday, Boeing reported nearly $5.9 billion in defense sales in the last quarter of 2021, a drop from $6.8 billion in the fourth quarter of 2020. Boeing\u2019s operating margins also slipped into negative territory at -4.4% in the quarter.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The company attributed the sales decline primarily to \u201clower volume and less favorable performance across the portfolio,\u201d including the KC-46 charge.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Boeing Chief Financial Officer Brian West said in a conference call with investors the pre-tax charge of $402 million was largely driven by \u201cevolving customer requirements\u201d for the tanker\u2019s Remote Vision System, as well as factory and supply chain disruptions, including problems stemming from the COVID-19 pandemic.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The Pegasus\u2019 vision system, a network of cameras and sensors boom operators use to guide the refueling boom into other aircraft, has continued to be a serious issue for the aircraft. Users of the original vision system had problems seeing the image or with distorted images in certain lighting conditions.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The Air Force and Boeing in 2020 decided to replace it with a redesigned version. But the Air Force said earlier this month it has not yet accepted the completed design of RVS 2.0, months after the design review was originally expected to be closed.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Boeing President Dave Calhoun said Wednesday the Air Force remains enthusiastic about the KC-46\u2032s performance.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cWe don\u2019t feel great about [the charge] by any respect,\u201d Calhoun said. \u201cBut the tanker today is an incredible asset for our customer, and now serves 70% of the missions that were intended in the development of the tanker. And our job is to continue to deliver the tanker and to do it more expeditiously as we move forward.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Air Mobility Command said in early January the overall development of RVS 2.0 remains on schedule. But AMC decided to keep the review open until it can figure out how to move forward on fixing technical risks with the panoramic visual system.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Asked to describe evolving customer requirements, Boeing spokeswoman Deborah VanNierop said it was \u201ccontinued RVS 2.0 development to include the panoramic display issue.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Boeing, which is on a fixed-price contract for the tanker program, has repeatedly had to pay charges on it since 2014. By the end of 2020, Boeing had paid more in cost overruns \u2014 topping $5 billion \u2014 than the $4.9 billion initial value of the contract. The latest charges bring that total to more than $5.4 billion.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The last KC-46 charge came in the fourth quarter of 2020. The company a year ago attributed that $275 million charge primarily to program inefficiencies, in part caused by the COVID-19 pandemic.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">However, strong performance throughout the rest of the year helped the company weather the last quarter\u2019s decline. Boeing logged $26.5 billion in defense sales in all of 2021, a 1% increase over its 2020 revenues.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Boeing and the Air Force say the new version of the KC-46&#8217;s Remote Vision System remains on schedule, despite lingering problems still being worked 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By:"},"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.0 (Yoast SEO v28.1) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>KC-46 vision system problems lead to $402 million charge for Boeing - Defense News<\/title>\n<meta name=\"description\" content=\"Boeing and the Air Force say the new version of the KC-46&#039;s Remote Vision System remains on schedule, despite lingering problems still being worked out.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/one.sightlinemg.com\/defensenews\/air\/2022\/01\/26\/kc-46-vision-system-problems-lead-to-402-million-charge-for-boeing\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"KC-46 vision system problems lead to $402 million charge for Boeing\" \/>\n<meta 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