HeraldNet: Airbus: Tanker decision political



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Aerospace Blog

June 19, 2008

Boeing Co. (click to enlarge)

Boeing gets another chance at the U.S. Air Force's $35 billion tanker deal. This is the first tanker it delivered to Japan.

Airbus: Tanker decision political

Tanker shakes up EADS, Boeing stock

Posted at 8:32 am by Michelle Dunlop

Yesterday’s news that the GAO had sided with Boeing’s protest of an Air Force tanker contract stirred up the markets.

In Paris, shares of EADS dropped as much as 4.4 percent before stabilizing down 2.4 percent. EADS and its partner Northrop Grumman initially won the $35 billion deal supplying tankers to the U.S. Air Force.

But losing bidder Boeing successfully protested the Air Force’s decision to the Government Accountability Office. The GAO told the Air Force is should open the contract up again after making several errors in the process. Boeing’s stock is up nearly 3 percent this morning.

A senior Airbus executive this morning suggested the decision was political and would impact how the European jet maker does business in America.

"It's not pleasant to see a bit of a political environment getting a foothold," Airbus Executive Vice President for Strategy and Planning Christian Scherer told Dow Jones Newswires.

"I think we will have to draw some conclusions on the way to conduct business," in the U.S., Scherer said.

The GAO’s decision could impact jobs at an Airbus factory in the U.K., according to this BBC report.

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