Tanker clock is ticking

EVERETT – The waiting game is about to begin for the Boeing Co. and Northrop Grumman.

By mid-April, the companies are expected to submit bids to supply the U.S. Air Force with refueling tankers in a contract worth $40 billion. To workers in Everett; Wichita, Kan.; and Mobile, Ala., the deal means jobs.

Lots of jobs.

And the importance of those jobs, as well as the U.S. content of the proposed tankers, became evident last week during a Northrop media briefing.

“If it’s built in Alabama, it’s built in America,” said Wes Bush, Northrop president, on Wednesday.

But Boeing and its supports tend to disagree.

Northrop will partner with Airbus’ parent company, European Aeronautic Defence and Space Co., to assemble its KC-30 tanker in Mobile, Ala., where as many as 2,500 direct jobs could be created. The consortium says their tanker will lead to 25,000 jobs nationwide. The company reports that 52 percent of the content of its tanker would be U.S. built.

There’s the rub.

Northrop-EADS will base its tanker off Airbus’ A330 – “an airplane we believe was born to be a tanker,” said Paul Meyer, Northrop’s vice president.

Besides being Boeing’s major rival, the European planemaker has come under attack from Boeing at the World Trade Organization for taking illegal government handouts to launch programs such as the A330.

In January, Boeing’s unions voiced concern about the tanker competition to Washington’s congressional delegation. The commercial version of Boeing’s tanker offering, its 767 jet, is built in Everett. Representatives of the International Association of Machinists and the Society of Professional Engineering Employees in Aerospace lobbied the state delegation to support Boeing’s bid over Northrop Grumman-EADS’.

The labor groups are dismayed at the prospect of a U.S. Air Force tanker being built largely in Europe near where the majority of Airbus commercial jets are made.

“European subsidies to EADS increase our concern because of the unfair advantage they provide,” they wrote.

The groups also suggested the politicians pressure Boeing to scale back any outsourcing the company may propose for the tanker competition.

Boeing estimates 85 percent of its tanker will be built in the United States, a 3 percent increase over the U.S. content of its commercial 767, said Leslie Hazzard, spokeswoman with Boeing’s 767 program. The Boeing Co. says its KC-767 tanker ensures 44,000 American jobs.

Hazzard isn’t sure whether Boeing winning the Air Force contract will lead to an increase in employment at the Everett facility. However, Boeing will change the way it builds 767 tankers for the U.S. Air Force compared to how the company manages production for the small tanker contracts it has with the Italian and Japanese air forces.

Boeing will supply Italy and Japan with four KC-767s each, with deliveries starting this year. For such low-volume contracts, Boeing builds the tankers in a three-step process. Everett workers build the commercial 767 before sending it to Wichita, where the jet’s doors, floors and systems are stripped and modified before the main transformation into a tanker begins. The Wichita group then installs aerial refueling systems and military avionics and conducts flight test operations.

Should Boeing win the Air Force bid, the middle step – where Wichita swaps out commercial doors, floors and avionics – would be eliminated. A tanker production line in Everett would build a 767 with the appropriate cargo door and floors, Hazzard said. The commercial 767 jet would continue to be produced in its same manner.

At the peak of the Air Force’s contract, it will need 15 tankers annually. The agency could accept as few as 12 tankers and as many as 18. The Air Force likely will announce the tanker contract winner later this year.

Reporter Michelle Dunlop: 425-339-3454 or mdunlop@heraldnet.com.