WASHINGTON — The European refueling tanker that won a $35 billion Pentagon contract last week “was clearly a better performer” than its U.S. rival, Air Force Secretary Michael Wynne told lawmakers Wednesday.
Speaking at a Senate Armed Services Committee hearing, Wynne said the plane offered by European Aeronautic Defence and Space Co. and its U.S. partner, Northrop Grumman Corp., was determined to be less expensive and less risky than the plane offered by Chicago-based Boeing Co.
The planes were judged on nine key criteria, he said, and “across the spectrum, all evaluated, the Northrop Grumman airplane was clearly a better performer.”
Committee Chairman Carl Levin of Michigan and the panel’s top Republican, John Warner of Virginia, said they would want more information on how the contract was won after the companies are briefed Friday.
Jim Albaugh, top executive of Boeing’s Integrated Defense Systems, said the company was surprised to lose the contract, and believes its proposal would have been a better choice.
“We offered an airplane that was more cost-effective. We offered an airplane that met the requirements better than the competition, and of lower risk,” Albaugh told a Citigroup conference of defense analysts in New York.
But Warner, who oversaw the tanker deal as head of the committee before Levin, commended the Air Force’s process and said he supports the decision.
Reacting to heavy criticism that the Pentagon is outsourcing military purchasing, Warner said lawmakers should back off.
“I feel very strongly that Congress should not get into the business of trying to rewrite a contract, particularly one of this magnitude and complexity,” he said.
The contract calls for the Air Force to buy 179 in-flight tanker aircraft over the next 15 years as it replaces its Boeing-built KC-135 tankers, which are on average 47 years old.
Boeing had been heavily favored to win the new contract, and the Air Force’s decision helps EADS — maker of Airbus — break into the world’s largest military market and opens the door to possible follow-up contracts.
The EADS/Northrop Grumman team plans to perform its final assembly work in Mobile, Ala., although the underlying plane would mostly be built in Europe. And it would use General Electric engines built in North Carolina and Ohio.
The contract award could still be challenged by Boeing or members of Congress. Boeing will protest the decision only “in the event that we think there is an irregularity in the proposal phase,” Albaugh said.
Boeing shares, which have shed more than a quarter of their value since reaching an all-time high of $107.83 last July, rose 94 cents, or 1.2 percent, to $80.56 in afternoon trading.
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AP Business Writer Dave Carpenter in Chicago contributed to this report.
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On the Net:
European Aeronautic Defence and Space Co.: http://www.eads.com
Northrop Grumman Co.: http://www.northropgrumman.com
Boeing Co.: http://www.boeing.com/
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