Tanker rebid unlikely, Airbus parent CEO says

  • Herald news services
  • Thursday, March 18, 2010 9:54pm
  • Business

NEW YORK — The chief executive of European plane maker EADS expressed some interest Thursday in renewing its bidding for the $35 billion contract for developing an Air Force refueling tanker.

But Chief Executive Louis Gallois said a tanker rebid wasn’t likely and that the 60-day time period now available wasn’t long enough to produce a competitive bid, according the Associated Press.

Gallois said EADS, which was teamed with Northrup Grumman in the previous tanker bid, had to drop out because Northrup chose to do so.

It was unclear whether EADS was pursuing an extension of the request for bids.

Gallois also said Thursday that his company is looking for a “medium-sized” acquisition in the U.S. following a failed bid for the Pentagon contract.

EADS, the parent of Airbus, wants to grow its defense and security business, which it sees as less risky than the commercial aircraft market. didn’t give details about the kind of company EADS wants to buy in the U.S., or when it would make an offer.

“It’s clear we need to be more in the United States,” Gallois said at a news conference with reporters. “We have to be considered as a U.S. citizen.”

When EADS pulled out of the tanker bidding earlier this month, it said a smaller plane offered by rival Boeing Co. appeared to be the front-runner for the 179-tanker order and criticized the contract as anticompetitive.

“The U.S. Air Force will not have the most modern, most capable airplane,” Gallois said. “It’ll be the first time the British, the Australians have a better airplane than the Americans.”

He said EADS will move to make other deals in the U.S. Building its presence here through acquisitions may bolster its case when bidding for national defense contracts, but “that would not be the objective,” said Sean O’Keefe, Chief Executive of EADS North America.

EADS will be looking to invest in parts of the country where it sees a long-term financial interest. It won’t be searching for areas with sympathetic members of Congress “because as we all know that changes every few years,” O’Keefe said.

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