Team Infidel
Forum Spin Doctor
Wall Street Journal
June 18, 2008
Pg. B3
By August Cole
If Boeing Co. loses its protest of the Air Force's decision to buy at least $40 billion worth of aerial refueling tankers from a competitor, it may abandon plans to sell its own tanker internationally.
Boeing had counted on the Pentagon to provide enough production volume to make an international tanker business viable, said Mark McGraw, the executive in charge of the Chicago company's tanker program. "Without that foundation of the Air Force program, it's very hard to be competitive in that international market," he said.
The Government Accountability Office is expected to rule on Boeing's protest as soon as Wednesday. The 100-day deadline for the review ends Thursday.
Boeing's backers say the Air Force made a mistake in picking a European airplane for use by the U.S. military. Northrop Grumman Corp. and its partner, Airbus parent European Aeronautic Defence & Space Co., say they submitted a superior proposal.
An Air Force spokesman declined to comment ahead of the GAO's decision.
Boeing has sold a handful of its tankers, based on the 767 jetliner, to the Japanese and Italian air forces. But it has encountered stiff competition, losing several battles to a version of the Airbus-based tanker that the U.S. wants to buy.
"The last five international head-to-head competitions with a Boeing 767-based tanker have been won by an A330-based tanker," said Northrop spokesman Randy Belote.
Boeing had counted on the Pentagon's endorsement to help it in future international competitions, but on Feb. 29, the Air Force picked Northrop to provide 179 modified Airbus A330s.
Boeing protested the decision, saying the Air Force changed its criteria midstream to favor the larger Airbus plane. Boeing has since said that it would have offered a version of its widebody 777 if it had known that officials were interested in a bigger plane.
Boeing's decision on the tanker program could have big implications for its military aircraft business. In 2001, Boeing lost out on building the next generation of fighter jets when the Air Force selected Lockheed Martin Corp. to build the Joint Strike Fighter. Leaving the tanker market would mean ceding another aircraft type to the competition, putting greater pressure on the aerospace company to diversify into other military businesses.
June 18, 2008
Pg. B3
By August Cole
If Boeing Co. loses its protest of the Air Force's decision to buy at least $40 billion worth of aerial refueling tankers from a competitor, it may abandon plans to sell its own tanker internationally.
Boeing had counted on the Pentagon to provide enough production volume to make an international tanker business viable, said Mark McGraw, the executive in charge of the Chicago company's tanker program. "Without that foundation of the Air Force program, it's very hard to be competitive in that international market," he said.
The Government Accountability Office is expected to rule on Boeing's protest as soon as Wednesday. The 100-day deadline for the review ends Thursday.
Boeing's backers say the Air Force made a mistake in picking a European airplane for use by the U.S. military. Northrop Grumman Corp. and its partner, Airbus parent European Aeronautic Defence & Space Co., say they submitted a superior proposal.
An Air Force spokesman declined to comment ahead of the GAO's decision.
Boeing has sold a handful of its tankers, based on the 767 jetliner, to the Japanese and Italian air forces. But it has encountered stiff competition, losing several battles to a version of the Airbus-based tanker that the U.S. wants to buy.
"The last five international head-to-head competitions with a Boeing 767-based tanker have been won by an A330-based tanker," said Northrop spokesman Randy Belote.
Boeing had counted on the Pentagon's endorsement to help it in future international competitions, but on Feb. 29, the Air Force picked Northrop to provide 179 modified Airbus A330s.
Boeing protested the decision, saying the Air Force changed its criteria midstream to favor the larger Airbus plane. Boeing has since said that it would have offered a version of its widebody 777 if it had known that officials were interested in a bigger plane.
Boeing's decision on the tanker program could have big implications for its military aircraft business. In 2001, Boeing lost out on building the next generation of fighter jets when the Air Force selected Lockheed Martin Corp. to build the Joint Strike Fighter. Leaving the tanker market would mean ceding another aircraft type to the competition, putting greater pressure on the aerospace company to diversify into other military businesses.