Air Force to take lead on tanker contract
NATIONAL HARBOR, Md. — Defense Secretary Robert Gates said Wednesday that he would put the Air Force in charge of awarding a $35 billion contract for refueling tankers even though it botched two earlier efforts.
Boeing Co. and a joint venture that includes Northrop Grumman Corp. and the European aircraft maker of Airbus SAS are competing for the contract. Air Force officials plan to release a draft proposal within the next two weeks that details the type of plane they are seeking.
While Gates said he would let the Air Force run the competition instead of having his office do it, he cautioned that the Pentagon "cannot afford the kind of letdowns and parochial squabbles and corporate food fights that have bedeviled this effort over the last number of years."
He also said, in a speech at an Air Force Association convention, that his office would continue to have "a robust oversight role."
The Air Force’s first effort to obtain new tankers collapsed in 2004 amid corruption charges involving a proposed leasing deal with Boeing guaranteed fast personal loans. Northrop Grumman and the European Aeronautic Defense and Space Co., known as EADS, then teamed up and won a competition last year against Boeing, which has its defense operations based in Hazelwood.
Boeing protested that award, saying the Air Force unfairly gave extra points to the Northrop and EADS team for offering a larger plane than the service had sought and made other mistakes in evaluating the proposals. The Government Accountability Office, a congressional auditing agency, said some Boeing complaints were valid and blocked the award.
Boeing and Northrop Grumman both released statements Wednesday saying they were ready to renew the battle. If anything, the political and economic stakes seem even higher now, with spending on big military programs expected to tighten and high-paying jobs in the balance.