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In a stunning upset for The Boeing Co., the Air Force reportedly has chosen a team of Northrop Grumman Corp. and Airbus parent EADS to supply air-refueling tankers in a closely watched, much debated and hard-fought competition.
The Air Force on Friday delivered a shock to storied American airplane builder The Boeing Co. by choosing a team of Northrop Grumman Corp. and Airbus parent EADS to build a new fleet of air-to-air refueling tankers — a contract potentially worth $100 billion.
Air Force Secretary Michael Wynne’s surprise announcement at the Pentagon set the stage for the next phase of a high-stakes struggle and coming debate likely to be framed in terms of economic nationalism.
Sue Payton, the Air Force official responsible for acquisition, acknowledged that Boeing could file a formal protest over the initial $35 billion contract decision, provoking a protracted investigation that might delay production of the first 179 tankers.
Congress also may take a look at the deal, which is expected to have the first new air-to-air tanker operational by 2013.
In a statement after the Air Force announcement at the Pentagon, Boeing spokesman William Barksdale said: “Obviously we are very disappointed with this outcome. Once we have reviewed the details behind the award, we will make a decision concerning our possible options, keeping in mind at all times the impact to the warfighter and our nation.”
Barksdale gave no indication whether Boeing would file a formal protest.
Air Force Gen. Arthur Lichte, commander of the Air Mobility Command that flies the tanker fleet, sought to rebut anticipated criticism that the Air Force has chosen a French-based aircraft maker over a major American company.
Referring to the EADS-Northrop model, Lichte told reporters at the Pentagon briefing: “This is an American tanker. It’s flown by American airmen. It has a big American flag on the tail, and every day, it’ll be out there saving American lives.”
The Air Force awards a $35 billion contract for aerial refueling tankers to a team of Northrop Grumman and EADS.
Boeing workers and Washington politicians express dismay and outrage at the decision. Boeing shares drop after-hours, Northrop’s rise.
The Air Force will debrief Boeing later this month. Boeing then could appeal the decision, and the GAO has 100 days to examine it, said Sen. Patty Murray.
IN EVERETT: Machinists Lodge 751 breaks out in boos upon hearing the news.
HISTORY: Once cozy, Air Force, Boeing ties now strained.