What could have been a done deal for the Boeing Co. five years ago came down to a two-horse race and finally a multibillion dollar loss for Everett on Friday in the sweepstakes to supply the Air Force with new jet refueling tankers.
The Air Force’s announcement that the $35 billion deal goes to Northrop-Grumman and Europe’s Airbus parent, EADS, angered members of Washington’s congressional delegation and raised the prospect of congressional hearings on the decision.
“We are outraged that this decision taps European Airbus and its foreign workers to provide a tanker to our American military,” six members of the congressional delegation said in a joint statement. “This is a blow to the American aerospace industry, American workers and America’s men and women in uniform.”
“I was shocked by the announcement today that the Air Force intends to award the contract for the next generation of Air Force refueling tankers to the Airbus-Northrop Grumman team, and I believe there will be real skepticism among the defense-related committees in Congress,” said Rep. Norm Dicks, D-Wash. Dicks is a powerful member of a Defense Appropriation Committee, and funding of the tankers will have to go through his panel.
“While we will await the debriefing of the Boeing team to learn how and why the decision was made, I remain convinced that the Boeing 767 tanker version would have been an extremely capable aircraft that would have created 40,000 U.S. jobs, including 9,000 in Washington state,” Dicks said.
Rep. Rick Larsen of Everett said he didn’t expect the nod to go to Airbus.
“I think Boeing builds the better tanker,” Larsen said. “It is a proven platform and it has the most advanced technology and is a better tanker.”
Congressional members say they hope the decision wasn’t influenced by a Boeing procurement scandal five years ago. And they expect Boeing to protest the decision.
First, the Air Force will sit down with Boeing officials to debrief them, probably on March 12, according to Sue Peyton, assistant defense secretary. Then Boeing has 10 days to file the protest with the Government Accountability Office.
The GAO has 100 days to deny or uphold a protest.
The Air Force has discouraged such a review, saying it could delay delivery of the much-needed refueling tanker fleet.
But a protest may not be the only obstacle for the Air Force.
Murray said it’s still too early to start talking about congressional hearings looking into the tanker decision, but others in Congress say hearings are possible.
“I wouldn’t preclude it,” Larsen said.
“The Air Force will have to explain their decision and (answer) allegations that somehow the rules changed at the end of the game,” Larsen said.
He was referring to news reports Thursday that the Air Force had changed criteria it used to assess rival bids just a few weeks ago.
The newly named KC-45As will be assembled in Mobile, Ala. The Air Force hopes to begin replacing aging Boeing-built KC-135 tankers by 2013.
The news wasn’t taken well in Olympia.
“This is unfortunate news for Boeing and the state of Washington,” Gov. Chris Gregoire said. “Boeing and its workers build the best planes in the world. They will continue to enjoy great success with their 787 Dreamliner and other innovative products still to come.”
Murray and Dicks were at the Everett Boeing plant Friday, expecting a favorable Boeing decision. Murray said she spent more than two hours talking with disappointed and frustrated Boeing workers.
“There’s a real sense of frustration that we’re taking American tax dollars and spending them on military airplanes overseas,” Murray said.
Although the Northrop-Grumman EADS plane would be completed in Alabama, Murray said that it certainly won’t be an American plane.
“You can put an ‘American’ sticker on a plane and call it American, but you can’t call it American made,” Murray said. “These planes are clearly going to be made overseas.”
Air Force officials Friday said that a past political scandal involving Boeing and the tankers had nothing to do with their decision.
In late 2001, Congress authorized the Air Force to lease 100 767s from Boeing and convert them to refueling tankers to replace the old KC-135s. The estimated cost then was a little more than $20 billion.
Led by Arizona Sen. John McCain, Congress squelched the deal in 2004 after a Boeing procurement scandal that sent a couple former Boeing officials to jail for conflict-of-interest. The scandal also prompted the resignation of two senior Air Force officials.
The Air Force went back to the drawing board and called for new bids on the purchase of 179 jet refueling aircraft, a deal that’s worth about $40 billion.
Northrop Grumman Corp. Joined forces with the Europe’s Airbus parent, EADS, to compete against the Boeing and the Everett-assembled 767s.
The Boeing procurement scandal shouldn’t have dissuaded the military from going with the Everett planes, Murray said.
“I can’t believe that it did,” she said. “It certainly will be a question in the back of our minds as we look at it.”
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