Intellectual Property issue between Boeing and Bedek- reasonable licensing fee

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Boeing seen spiking IAI’s IAF tanker bid

Boeing offers KC-46

Bedek offers converted B-767

Boeing License Fee $1M per conversion

 

Once again, intellectual property is an issue between an Original Equipment Manufacturer and a major client country/its wholly owned prime aerospace and aviation manufacturer/repair station. Israel Aerospace Industries’ Bedek group . The same debate has been litigated in a US Court of Appeals, the subject of a Ukrainian criminal action, a substantial risk within the PRC and a landmark agreement with an OEM.  These different forums must be utilized because IP is an issue for which the FAA has neither technical competence nor jurisdiction.

The Israel Air Force decided that its current tankers, used Boeing 707s converted by IAI in the early 1980s, are ready for replacement. The Ministry of Defense and the IAF issued defense procurement, expected to be the biggest programs in the near future.

 

The KC-46 Pegasus is based on the B-767 design. The sophisticated tanker has a price tag of $250-300 million and has incurred significant delays in production and proving runs.

Bedek’s offer is to convert a B-767 for $150 million, with no significant shortfall in capacity and performance.  The company has a proven track record of converting Boeing products under license. In the past, it did work on 767s refurbishing them as tanker-transports for the Brazilian and Colombian Air Forces both operate examples of this KC-767 conversion.

The problem, a reoccurring one mentioned in the opening paragraph, is that Bedek must have access to necessary data, drawings and a license from Boeing. Reports say that the Chicago/Seattle aerospace company  has set a price between $500,000 and $1 million per conversion.

The articles on the IAF tanker RFP seem to say that Boeing’s licensing fee guarantees it will win the competition. Those same sources indicate that the Bedek sales price is about $100 million cheaper than the new KC-46s. If the Boeing charge for its Intellectual Property is $1 million, that seems fair and hardly a deal



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