EADS wants Boeing to share tanker contract

  • Associated Press
  • Friday, December 3, 2004 9:00pm
  • Business

PARIS – European Aeronautic Defense and Space Co., the parent of aircraft maker Airbus SAS, has proposed splitting a contested U.S. Air Force contract for refueling tankers with its rival, the Boeing Co., the European group’s U.S. office said Friday.

Diane Murphy, vice president of EADS North America, said the defense group had signaled readiness to share the order with its Chicago-based rival.

“What we’re saying is that we believe it could be split, and that this is acceptable to us as well,” Murphy said.

The EADS offer comes after the Pentagon reopened the competition for a multibillion-dollar contract for 100 midair refueling tankers. The contract had previously been awarded to Boeing.

Asked to respond to the EADS comment, Boeing spokesman Doug Kennett said: “The Department of Defense and the Air Force are in the process of reviewing their options. It will be the government that will make the decision on how to proceed on the tanker program.”

Boeing lost the $23 billion order to convert 767s into tankers amid a growing corruption scandal centered on former Air Force official Darleen Druyun, who admitted giving special treatment to Boeing on the tanker deal and other contracts.

Druyun, who later joined Boeing as a top executive, was sentenced to nine months in prison after she pleaded guilty on felony charges. Former Boeing chief financial officer Michael Sears has also pleaded guilty for his role in hiring her.

EADS has invested $106 million on improving its original U.S. tanker bid, which is based on a conversion of the Airbus A330 passenger jet.

The United States is currently locked in a World Trade Organization dispute with the European Union over public aid to Airbus and Boeing, and Airbus CEO Noel Forgeard has conceded this could complicate efforts to secure the tanker deal.

George Behan, chief of staff for Rep. Norm Dicks, D-Wash., and others who backed the original Boeing deal noted that EADS is working to produce a tanker but does not have one operational yet, a fact noted when the Air Force determined several years ago that EADS did not have a competitive offer.

“The whole beauty of that (Boeing) proposal is that you are talking about an off-the-shelf aircraft that has a worldwide maintenance capability and can be purchased at a competitive price and maintained,” Behan said.

EADS has pledged that its tankers would be built and assembled in the United States by American workers.

Aerospace analyst Paul Nisbet of JSA Research said he doesn’t think a split contract would be feasible.

“It conceivably could be done, but it doesn’t make a lot of sense,” he said. “You’d have a mixed fleet, you’d have to have two supply lines for parts, you’d have to have crews and mechanics for each kind of airplane.”

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