By Bryan Corliss
Herald Writer
Airbus isn’t able to build a suitable aerial refueling tanker, the U.S. Air Force announced Friday.
That opens the door for the Boeing Co. to provide the Air Force with 100 767 tankers through the lease deal Congress authorized in December.
"It reaffirms what we have known from the beginning," said U.S. Sen. Patty Murray. "There is no other tanker manufacturer."
The $20 billion deal is expected to generate about 2,400 Boeing jobs around Puget Sound, 5,500 more at Puget Sound parts suppliers and at least 1,300 jobs at Boeing’s facilities in Wichita, where 767 parts are made and where the planes will be modified for military use.
The 100-plane order would be one of Boeing’s biggest commercial orders ever, but it would not come soon enough to reverse the current layoffs.
Under plans discussed last winter, orders for the first six planes would come late this year, with the first deliveries in 2005. Peak production, 20 planes a year, would occur from 2007-10.
That represents a 50 percent increase over this year’s planned production, noted U.S. Sen. Maria Cantwell, who with Murray pushed for the deal.
"This contract will keep Boeing workers on the production line at a time when the state’s economy needs it most," she said. "This is a win for the men and women who make Boeing a success."
Congress approved the unusual lease program for the Air Force in the wake of the Sept. 11 attacks. The war in Afghanistan has strained the ability of the Air Force’s aging fleet of KC-135 refueling planes, and there was a sense in Congress that Boeing — which did not receive any of the airline industry bailout funds — needed federal help.
The lease deal allows the Air Force to get around spending limits and move quickly to retire the oldest KC-135s in the fleet. Those tankers are based on Boeing 707s and are on average of 42 years old.
However, congressional critics — most notably Arizona Republican Sen. John McCain — complained that the deal was little more than corporate welfare. Others complained about the deal being a lease, saying that the government would pay too much in the long run.
And officials with EADS, the European aerospace alliance that owns 80 percent of Airbus, also complained that they had been denied a chance to bid on the contract. Boeing’s price is "extraordinarily excessive," wrote Gregory Bradford, EADS’ North American president. He said a competitive bid would shave $8 billion off the total.
Faced with that, the Air Force asked Boeing and EADS to submit proposals for a tanker contract.
A review of that information "clearly demonstrated that only the Boeing Co. can currently meet the requirements," the Air Force announced Friday. As a result, the team in charge of the tanker program "will proceed to negotiate a lease with Boeing."
EADS proposed to convert Airbus A330s for use as tankers. There were four problems with that idea, the Air Force said.
First, "EADS lacks relevant tanker experience and needs to develop an air refueling boom and operator station." That makes its proposal significantly more risky.
The review also rejected the EADS claim that it could supply more economical planes. The Boeing planes have better net values, the Air Force said.
The A330 also would take up more space on the ground than the 767, without delivering any more fuel-carrying capacity in the air.
And finally, the Air Force would have to put more money into the supporting infrastructure of the plane with the Airbus proposal, and those infrastructure needs would limit where the planes could be deployed.
Boeing was pleased with the news, said Military Aircraft and Missile Systems chief Jerry Daniels.
"We have a lot of work to do, and we look forward to the next step — completing our negotiations with the Air Force," he said.
"We hope that comes sooner, rather than later," Murray said.
You can call Herald Writer Bryan Corliss at 425-339-3454
or send e-mail to corliss@heraldnet.com.
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