Pentagon opens new Air Force tanker competition

Sep 25, 2009, 17:53 GMT

Washington - The Pentagon reopened bidding on contracts to build the next generation of Air Force tanker refuellers on Friday after an earlier deal fell through last year amid a trans-Atlantic trade complaint.

The US cancelled the competition between Boeing and the Northrop Grumman-European Aeronautic Defence and Space Company (EADS) partnership for the 35-billion-dollar contract after Defence Secretary Robert Gates determined it was too politically charged and could not be completed before president George W Bush's administration ended.

Gates at the time issued a statement acknowledging the Pentagon's mistakes in managing the lengthy competition, which was thrown into disarray when a congressional oversight agency upheld a Boeing protest and ruled the Air Force erred in awarding the contract to Northrop-EADS.

Deputy Defence Secretary William J Lynn said Thursday that defence needs and value would be central to the Pentagon's request for new proposals.

'This time we will be crystal clear about what we want and what the bidders need to do to win,' Lynn said.

The contract would be for 179 planes worth about 35 billion dollars.

Boeing on Friday said it had received the details of the bid request for the KC-X Tanker.

'Both the Air Force and the American taxpayer will benefit from the tanker options we can offer,' the company said in a statement.

The congressional Government Accountability Office (GAO) in June 2008 concluded the Pentagon should start a new competition after determining the Boeing proposal was not fairly reviewed when the contract was awarded to Northrop and EADS.

The contract had been the focus of intense political scrutiny from members of Congress who opposed handing it to a European firm at a time when the US economy was struggling.

Congressional battle lines were drawn between members whose districts would have benefited from a Boeing award and those aligned with Northrop-EADS.

EADS planned on building a factory in Alabama to assemble the aircraft from components manufactured in Europe.