Boeing: Briefing on tanker contract raises 'significant concerns

McClatchy NewspapersMarch 7, 2008 

WASHINGTON — After being briefed by the Air Force, The Boeing Co. said Friday that it had "significant concerns" about a Pentagon decision to award a $40 billion contract to a team that will use a European airplane to replace its fleet of Eisenhower-era aerial refueling tankers.

"What is clear is that reports indicating that the Airbus offering won by a wide margin could not be more inaccurate," said Mark McGraw, the vice president in charge of Boeing's tanker program.

McGraw said Boeing would give "serious consideration" to filing a protest.

Boeing will have 10 days to file a protest with the Government Accountability Office. The GAO then will have 100 days to rule on the protest.

"Our plan is to work through the weekend to come to a decision on our course of action early next week," McGraw said. "It will be a very rigorous and deliberative process to ensure we're balancing the needs of the war fighter with our desire to be treated fairly. For decades Boeing has been recognized as a defense company that never takes lightly protests of our customers' decisions."

Air Force officials have said that the bid from Northrop Grumman and the European Aeronautic Defense and Space Co. easily won the competition for 179 new tankers. But Boeing and its supporters on Capitol Hill have charged that the Air Force changed the ground rules for the competition at the last minute in a way that favored the Northrop-EADS tanker.

Northrop-EADS will use an Airbus A330 for its tanker. Major sections of the plane are built in France, Great Britain, Germany and Spain, though according to the companies final assembly of the tanker will take place at a new facility in Mobile, Ala.

Boeing's tanker would use a 767 plane, built in Everett, Wash. Refueling equipment and final flight testing would be done in Wichita, Kan.

Critics of the Air Force decision to use a European plane have said it will result in U.S. jobs being exported overseas, that it rewards a company whose planes have received billions of dollars in government subsidies that are illegal under world trading rules and that it would be a serious blow to the nation's defense-manufacturing base.

Supporters of the contract say that Northrop-EADS simply submitted a more attractive bid, adding that 60 percent of the tankers' content will be American-made.

Boeing's briefing from the Air Force, which came a week after the contract was awarded to Northrop-EADS, lasted several hours, McGraw said.

"While we are grateful for the timely debriefing, we left the room with significant concerns about the process in several areas, including program requirements related to capabilities, cost and risk, evaluation of the bids and the ultimate decision," McGraw said.

Sen. Patty Murray, D-Wash., who's criticized the decision to award the contract to Northrop-EADS in daily speeches on the Senate floor, said Boeing needed to take time to decide whether to appeal.

"I continue to believe the Air Force's shortsighted decision is a threat to our national defense and the future of America's aerospace industry," Murray said in a statement.

Sen. Pat Roberts, R-Kan., said Congress also needed to play a role in reviewing the contract.

"We are all very concerned about the criteria the Air Force used in awarding the tanker contract, and we've asked the Department of Defense to suspend the tanker contract until both Boeing and Congress have the ability to review it," Roberts said in a statement.

McClatchy Newspapers 2008

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