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<< Previous   of   Next >> (click to enlarge)   ADVERTISEMENT   CONTACT THE HERALD Mike Benbow, Business Editor benbow@heraldnet.com   Published: Monday, April 7, 2008 Tanker outsourced or not? Boeing is protesting the Air Force decision on a number of issues, not the least of which is jobs in America. By Michelle Dunlop Herald Writer EVERETT -- The winner of a $35 billion aerial refueling tanker contest took issue last week with persistent criticism from the Boeing Co. that its aircraft isn't American-made. Northrop Grumman, along with partner EADS, won the lucrative U.S. Air Force contract at the end of February. Boeing -- which protested the duo's win with Congress's investigative agency -- and its supporters say the Pentagon committed several errors in the process and ultimately outsourced American jobs and national security to Europe. "Let's just be fair, open and honest -- we both have foreign components," said Paul Meyer, vice president of Northrop air mobility systems, during an investors conference call on Tuesday. Boeing has said it offered the Air Force a KC-767 tanker made of 85 percent U.S. content with the remaining 15 percent coming from suppliers in Japan, Italy and the United Kingdom. Northrop and EADS aimed to offer the Air Force a tanker comprised of roughly 60 percent U.S. content. "We have achieved that particular goal," Meyer said. Northrop partner EADS recently won a contract supplying the British with a tanker based off of the same Airbus A330 jet. In an EADS press statement, the company said the U.K. tanker will be 50 percent British by value. Meyer countered claims that the KC-30 is a French tanker. Its partner EADS is the parent company of Toulouse, France-based Airbus. The French provide about 13 percent of Northrop and EADS KC-30's components with the Germans supplying 15 percent. Spain and the U.K. round out the remainder of the KC-30, supplying 6 percent and 8 percent respectively of the tanker's components, Northrop said. Boeing supporters -- such as U.S. Reps. Todd Tiahrt, R-Kan., and Jay Inslee, D-Wash. -- noted last week that the Northrop and EADS tanker is based off Airbus' A330 jet. The lawmakers said Boeing's loss not only sends jobs to Europe but also impedes the United States' ability to manufacture defense aircraft for itself. "Americans are outraged by the Air Force's outsourcing of our national security to Europe," Tiahrt said. Northrop's Meyer insists the KC-30 win creates job opportunity in the United States, bringing five new aerospace manufacturing plants to the country. The partners will open a widebody jet commercial production plant -- only the second in the country -- in Mobile, Ala., where their tanker will go through final assembly. Additionally, EADS will bring final assembly work on Airbus' A330 freighter to Mobile. "No jobs have moved to Europe," Meyer said. Meyer's remarks are supported, in part, by the results of a recent survey conducted by the Pacific Northwest Aerospace Association. About 66 companies had responded by late last week. The companies estimated a total of 250 to 262 jobs could be lost if Boeing shuts down its 767 commercial line in Everett. The Chicago-based Boeing would assemble its KC-767 tanker in Everett with finishing work taking place in Kansas. The company says its tanker supports 44,000 jobs nationwide. Aerospace companies reported that up to 417 jobs will not be added in the near term if Boeing's protest with the Government Accountability Office fails. The GAO has until mid-June to review the protest. Northrop and EADS note their KC-30 will create 48,000 direct and indirect jobs in the country. In disputing Boeing's allegations, Northrop claimed that Boeing increasingly has relied on foreign countries to supply parts for its aircraft. Boeing's 727 jet, built in 1963, was made with 98 percent U.S. content. Its 777, which came out in the early 1990s, contained 68 percent U.S. components, Northrop said. "Globalization is widespread," Meyer said.

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