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Pentagon picks EADS/Northrup for tanker contract

Latest update : 2008-02-29

The Pentagon has chosen Europe's EADS, parent of Airbus, and US partner Northrop Grumman for a massive refueling tanker aircraft contract, the Wall Street Journal said Friday.


  
The Pentagon has chosen Europe's EADS, parent of Airbus, and US partner Northrop Grumman for a massive refueling tanker aircraft contract, the Wall Street Journal said Friday.
  
The newspaper, citing a person familiar with the situation, said the partnership won a heated contest against US-based aerospace giant Boeing for the contract of some 40 billion dollars.
  
The Defense Department was to announce the winner of the US Air Force contract at 2200 GMT.
  
Boeing, the second leading US defense contractor after Lockheed Martin, has been considered the heavy favorite to snare the contract to provide 179 twin-engine planes that essentially are flying gas stations, used to refuel in-flight war planes and troop transporters.
  
The contract is one of the Pentagon's largest in recent years and the first order on a tanker market estimated at more than 100 billion dollars in over 30 years.
  
The outcome of the competition is being closely watched not just because of the enormous size of the contract. There are domestic and geopolitical implications at issue in the US Air Force's choice between an all-American contractor or a mainly US team that includes a foreign contractor.
  
An EADS victory would give the European firm its first major foothold in the world's largest defense market.
  
Boeing proposed a version of its long-haul cargo plane the 767-200.
  
EADS offered a modified version of the Airbus 330. The commercial plane would be militarized by Northrop Grumman and its American partners to prevent the transfer of sensitive technology to a foreign entity.
  

Date created : 2008-02-29

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