EADS and Northrop Grumman Win Air Force Tanker Contract

By Dan Keane
20:12, March 1st 2008
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EADS and Northrop Grumman Win Air Force Tanker Contract

European Aeronautic Defense and Space Company (EADS) and Northrop Grumman have prevailed over Boeing to grab a contract for up to 179 aerial tankers to replace the United States Air Force's aging tanker planes. The deal may be worth as much as $30 billion to $40 billion over the next 10 to 15 years. Eventually, the United States Air Force will have to replace all 600 tanker planes, which might lead to that sum doubling easily.

"We are very proud to have won a victory on the American market over Boeing," EADS CEO Louis Gallois told France Info radio. "We are creating lots of jobs in the United States but we are also creating them in Europe," he said.

EADS and its U.S. partner, Northrop Grumman, will build a new factory in Mobile, Alabama. Commercial freighters will also be produced here. Apparently, the civilian Airbus 330 will be built here along with its military brother. The company alleges that up to 1,800 jobs will be created in the Mobile area and up to 5,000 across Alabama.

The Air Force chose the tankers based on converted A330 Airbus passenger jets, offered by Northrop-EADS, over the competing Boeing design based on the 767 airliner. Boeing spokesman William Barksdale hinted at a possible protest, and they are not the only ones unhappy. The American defense industry has some powerful friends:

"It's stunning to me that we would outsource the production of these airplanes to Europe instead of building them in America," said Republican Senator Sam Brownback about Pentagon's decision, according to AFP. "I'll be calling upon the Secretary of Defense for a full debriefing and expect there will be a protest of the award by Boeing."

However, Boeing has a dark history concerning military tankers. The company in fact won a similar contract in May 2003, but allegations of procurement fraud led to Boeing paying a record 615-million-dollar settlement to the United States government.



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