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Business

Pentagon may extend bidding on refuelling tanker contract

Video by Lorna SHADDICK

Text by News Wires

Latest update : 2010-03-19

The Pentagon said on Thursday that it might extend a deadline for bids on supplying the US military with a new aerial refuelling tanker after Airbus parent EADS said the current mid-May deadline would be "impossible" to meet.

AFP - The Pentagon on Thursday said it might extend a deadline for bids on a new aerial refueling tanker after Airbus parent EADS signalled it could return to the competition.

Having been informed by EADS of its possible interest in the contract, the Defense Department "would consider a reasonable extension to the RFP (Request for Proposals) deadline," press secretary Geoff Morrell told AFP.

The US Air Force tanker aircraft project has been plagued by controversy and scandal, with French President Nicolas Sarkozy and European officials accusing Washington of setting up rules to favor US aviation giant Boeing.

European Aeronautic Defence and Space Company, parent of aircraft maker Airbus, said earlier Thursday that it would be "impossible" to meet the mid-May deadline for bidding on the 35-billion-dollar contract.

"It’s clear that in the 60-day timeframe, that it's impossible for anybody, even for Lockheed Martin, to build a solution," EADS chief Louis Gallois said at a briefing in New York, according to his spokesman.

The 60-day period roughly is the time left after EADS's US bid partner Northrop Grumman dropped out of the competition on March 8.

Asked about Northrop's decision to bow out, Gallois called it a "huge frustration."

Northrop Grumman's exit from the competition left the field open to Boeing, arch-rival of France-based Airbus.

The Pentagon said it was committed to a "fair and open competition" and would "welcome" a decision by EADS to participate, Morrell said.

Extending the deadline for proposals is "not unusual," he said.

Deadlines for proposals have been postponed for other defense programs, Morrell said, including the US Navy's unmanned aircraft system (BAMS), the VH-71 helicopter, and a new version of the precision-guided small diameter bomb, SDB II.

But it remained unclear if EADS would decide to take part, with analysts saying the terms of the contest appear to Boeing's smaller, cheaper plane.

In the last competition, EADS and Northrop offered a modified version of the Airbus 330, while Boeing proposed an altered 767 in its bid.

The Pentagon released the final requirements for the contract to build 197 tanker planes on February 24, opening bidding for 75 days.

Sarkozy last week criticized the United States over the tanker contest, saying it was not the way for Washington to treat its European allies.

"These are methods which are not good for the partners of the United States, which is a great nation with which we are close and friends with," Sarkozy said in London.

Northrop, EADS, key European officials and US lawmakers whose states would have benefited from a Northrop victory have accused the Pentagon of unfairly structuring the bid requirements to favor Boeing's smaller plane.

The Pentagon has rejected the charges and insisted the terms of the project favor neither side.

The Northrop-EADS team originally won the contract in February 2008, but the deal was cancelled after Boeing successfully appealed the decision to the investigative arm of Congress.

In 2003, the Pentagon awarded a contract to Boeing but later suspended the deal after an ethics scandal involving a company executive and an Air Force official. The Air Force official was later convicted of criminal conspiracy.

Military commanders view the planned KC-X aircraft as crucial to sustaining US air power and are anxious to replace the older Boeing KC-135 Stratotankers that date back to the 1950s.

Date created : 2010-03-19

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