New twist in Air Force tanker contest

With the Pentagon expected to release the final bid request this week for the second round of bidding on a $40 billion contract to supply the US Air Force with refueling tankers, Boeing has threatened to withdraw from the contest unless the Department of Defense grants a six month extension to the bid process, so it can work on the design of a larger aircraft.  ┬á The contract to build 179 refueling tankers over 15 years was awarded on February 29 to Los Angeles-based Northrop Grumman and its partner, EADS North America, a subsidiary of European Aeronautic Defence and Space Co., the parent of Airbus.┬á┬á Boeing campaigned to get the tender process reopened, culminating in an appeal to the Government Accountability Office (GAO) which upheld BoeingÔÇÖs claim that ÔÇ£significant errorsÔÇØ had been made in the process.┬á┬á After a draft version of the tender document was released earlier this month, representatives from Boeing┬áand Northrop Grumman met with Pentagon officials last week. The final version of the document could be given to the two aircraft manufacturers as early as today. ┬á┬á But Boeing believes the terms of the draft version still favor Northrop's larger plane and give Boeing little time to make changes to its proposal. The Pentagon has indicated it will set a timetable of two months for the bid. Boeing says it needs six months to revise its proposal.┬á┬á "Our feeling is that this is truly a new competition and the kind of aircraft the Air Force feels they need have changed," said Boeing spokesman Dan Beck, arguing that as the Air Force now seems to want more fuel capacity, Boeing deserves the right to make the necessary changes. ┬á┬á "All we are asking for is a significant amount of time to put together a competitive proposal," he said. "We really do want to provide them with their next-generation tanker, but if we do not have enough time to prepare a competitive bid, then we have to decide if it's worth it." ┬á┬á Some observers believe that Boeing misjudged the Air ForceÔÇÖs requirements in its first bid and is politicizing the debate to exploit fears about defense work being contracted to an overseas supplier, to distract from its own shortcomings.┬á┬á Until the announcement was made to award the contract to the Northrop/EADS alliance, Boeing had been full of praise for the ÔÇ£fair and open wayÔÇØ in which the Air Force conducted its evaluation.┬á┬á Meanwhile, two US engine manufacturers are biting their fingernails until a final decision is made. If the second bid-round confirms Northrop as the successful bidder its KC-30 (based on the Airbus A330) will be powered by engines built by Fairfield-based General Electric. Boeing's offering, the KC-767 (based on the Boeing 767) will use eninges built by East Hartford-based Pratt & Whitney. ┬á┬á*┬á┬á┬á┬á┬á┬á┬á┬á┬á *┬á┬á┬á┬á┬á┬á┬á┬á┬á *