Boeing put the the first KC-135 Stratotanker into service 52 years ago.  The U.S. Air Force bought the last one in 1965.

The four-engine KC-135 Stratotanker jets across the firmament, refueling other aircraft in flight.  It also, per Boeing – which first delivered the hulking milk cow in June 1957 —  can with upgrades "serve as flying command posts, pure transport, electronic reconnaissance, and photo mapping craft."

In 2005, the Air Force asked for proposals on a contract to provide upkeep of the aging fleet of more than 415 Stratotankers.  Boeing's response to the Request for Proposal won.  A losing bidder, Alabama Aircraft Industries, protested the award to the Government Accountability Office.  The GAO found Boeing's "price-realism analysis" wanting and told the Air Force to take another look.  Boeing got the contract the second time, too.  The GAO denied AAI's protest of the new award.

AAI sued in the U.S. Court of Federal Claims and prevailed.  The court set aside the award on the ground that Boeing and the Air Force hadn't done enough to explain pricing in light of the KC-135 fleet's advancing ancientness. 

The Federal Circuit reversed, holding that the GAO's ruling didn't transgress the "arbitrary and capricious" standard for overturning agency decisions under the Administrative Procedure Act.  While the Air Force failed to address the impact of age on price in a direct and explicit way, the court noted, it did make bidders structure their proposals to include a basic maintenance component, a "discrete" additional tasks component, and an "unexpected work" component.  The Air Force thus "decided the best approach was to provide all offerors with the three-tier work package on which to base their proposals.  This was a determination well within the agency's discretion."  Ala. Indus., Inc. – Birmingham v. United States, No. 09-5021, slip op. at 7 (Fed. Cir. Nov. 7, 2009).