MOBILE, Ala. – With a multibillion-dollar aircraft plant for Mobile, Ala., at stake, Republican Gov. Bob Riley has enlisted U.S. Sen. John McCain’s help in pushing for a “totally open” process in awarding contracts for a new fleet of Air Force refueling tankers.
Campaigning for Riley’s re-election in the Nov. 7 general election, the Arizona Republican who may become the Senate Armed Services Committee chairman took issue with an Air Force decision that made the World Trade Organization a factor in awarding the contracts.
The Air Force has said that “treaty compliance” is among the criteria that interested companies must meet to build the estimated 100 planes.
The language refers to a dispute before the WTO in which congressional supporters of the Boeing Co. have complained that European jet maker Airbus SAS receives subsidies from European governments, giving it an unfair advantage in seeking U.S. business. Airbus in turn has argued that Boeing also receives government support.
McCain said he had “no idea” why the WTO language was included.
“We’ve had competition for many other defense systems that had to do with foreign manufacturers, and they’ve never thrown in the WTO language,” McCain told reporters at a Mobile news conference after speaking to a chamber of commerce event.
Chicago-based Boeing and EADS – European Aeronautic Defence and Space Co., the majority owner of jet-maker Airbus – are the leading contenders for the tanker contract, potentially worth more than $20 billion. If Boeing’s bid is selected, the tankers would be assembled in Everett.
EADS has teamed with Los Angeles-based Northrop Grumman Corp. on its bid and plans to build the KC-330 plane in Mobile if it wins the work.
McCain promised hearings on the tanker deal, which has been on hold for more than two years after Boeing lost the contract amid an ethics scandal.
McCain said he’s satisfied that Boeing “has made fundamental and significant changes in the way that they do business and I have confidence in them. But that doesn’t mean we stop watching the process.”
“I don’t know how it’s going to come out,” said McCain. “We will be making sure this is in the best interest of all America.”
As Armed Services Committee chairman, McCain would have influence over Department of Defense contracts.
He said he didn’t know when the tanker decision would be made, but it could be authorized next year. He said his primary objective is for an “open, fair and transparent procurement process.”
Alabama’s port city has offered a $110 million package of incentives – including $82 million in cash – for the tanker project with Northrop Grumman and EADS North America.
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