EADS to enter bid on contract with US Air Force

AFP - European aerospace giant EADS announced on Tuesday it will bid on a 35-billion-dollar contract to supply the US Air Force with a new fleet of aerial refueling tankers.

"We have notified (the Pentagon) that we are going to bid," Ralph Crosby, chairman of EADS North America, told a news conference.

The move will pit Airbus parent EADS against archrival Boeing for the high-stakes contest, which has been plagued by scandal and controversy.

The decision came after the Defense Department said it would extend a May 10 deadline for bidding by 60 days if it receives formal notification from EADS that it intends to make an offer.

The Pentagon welcomed the announcement.

"We have consistently supported competition for the Air Force KC-X tanker replacement program. The department is committed to conduct a fair, open and transparent acquisition process," it said.

EADS had asked for a 90-day extension after its US partner Northrop Grumman dropped out of the competition, saying the contract requirements favored Boeing's plane.

EADS is "progressing in discussions with potential US partners to build a winning team in order to provide the most capable, best value solution to the Air Force," the company said in a statement.

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

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