Boeing was on Monday poised to win a US$35 billion US Air Force aerial refueling tanker plane contract after rival partners Northrop Grumman and the European Aeronautic Defence & Space Co NV (EADS) bowed out.
Northrop Grumman said it had decided not to bid to build the new planes because the US Air Force’s requirements for the KC-X tanker program, published last month, favored Boeing.
The Defense Department’s request for proposals “clearly favors Boeing’s smaller refueling tanker and does not provide adequate value recognition of the added capability of a larger tanker, precluding us from any competitive opportunity,” said Wes Bush, chief executive and president of the US defense contractor.
The Pentagon said it regretted Northrop’s decision.
“We are disappointed by Northrop’s decision not to submit a bid for the US Air Force tanker replacement program,” US Deputy Secretary of Defense William Lynn said.
“In the last tanker replacement competition, Northrop Grumman competed well on both price and non-price factors. We strongly believe that the current competition is structured fairly and that both companies could compete effectively,” Lynn said.
The Northrop-EADS team had won the contract in February 2008, but the deal was canceled after Boeing successfully appealed the decision to the Government Accountability Office, the investigative arm of Congress.
Northrop and EADS, the parent of Boeing’s arch-rival Airbus, at the time had offered a modified version of the commercial Airbus A330, while Boeing had proposed a 767-based tanker.
“This is particularly disappointing given that the Air Force previously had selected the A330-based KC-45 because of its added capability, lower risk and best value,” EADS said in a statement on Monday.
With the exit of Northrop and EADS, Boeing is in prime position to snare the contract to replace the 1950s-era aging fleet of Boeing tankers.
Boeing announced last week that it would again offer a modified version of its 767 commercial airliner, which is smaller than the A330 and consumes less fuel.
The Chicago-based firm had said it would submit its proposal by May 10, within the 75-day period set out in the Pentagon’s request for proposals.
EADS said yesterday that provisions for its military transport plane and A380 superjumbo jet led to losses in the fourth quarter and full year.
Paris-based EADS said that it had lost 1.05 billion euros (US$1.44 billion) in the three months to December after booking charges of 1.6 billion euros for the A400M military project and 240 million euros for the A380 in the period.
The loss compares with a 490 million euro net profit a year earlier.
In the full year, the net loss of 763 million euros compares with a net profit of 1.57 billion euros in 2008.
Revenue fell 1 percent last year to 42.82 billion euros and EADS said it expects roughly stable revenues this year.
The company called the economy this year “improving but still volatile.”
Airbus expects to deliver the same number of aircraft this year as last year and capture between 250 and 300 new gross orders.
Earnings before interest and taxes, or EBIT, this year will be around 1 billion euros, the company said.
Last year, EADS had an EBIT loss of 322 million euros, compared with underlying earnings of 2.83 billion euros a year earlier.
Airbus last year beat rival Boeing in aircraft production, delivering a record 498 aircraft and maintaining its place as the world’s largest planemaker. Airbus survived a crisis year for the airline industry to post 271 orders, beating Boeing’s 142.
The CIA has a message for Chinese government officials worried about their place in Chinese President Xi Jinping’s (習近平) government: Come work with us. The agency released two Mandarin-language videos on social media on Thursday inviting disgruntled officials to contact the CIA. The recruitment videos posted on YouTube and X racked up more than 5 million views combined in their first day. The outreach comes as CIA Director John Ratcliffe has vowed to boost the agency’s use of intelligence from human sources and its focus on China, which has recently targeted US officials with its own espionage operations. The videos are “aimed at
STEADFAST FRIEND: The bills encourage increased Taiwan-US engagement and address China’s distortion of UN Resolution 2758 to isolate Taiwan internationally The Presidential Office yesterday thanked the US House of Representatives for unanimously passing two Taiwan-related bills highlighting its solid support for Taiwan’s democracy and global participation, and for deepening bilateral relations. One of the bills, the Taiwan Assurance Implementation Act, requires the US Department of State to periodically review its guidelines for engagement with Taiwan, and report to the US Congress on the guidelines and plans to lift self-imposed limitations on US-Taiwan engagement. The other bill is the Taiwan International Solidarity Act, which clarifies that UN Resolution 2758 does not address the issue of the representation of Taiwan or its people in
US Indo-Pacific Commander Admiral Samuel Paparo on Friday expressed concern over the rate at which China is diversifying its military exercises, the Financial Times (FT) reported on Saturday. “The rates of change on the depth and breadth of their exercises is the one non-linear effect that I’ve seen in the last year that wakes me up at night or keeps me up at night,” Paparo was quoted by FT as saying while attending the annual Sedona Forum at the McCain Institute in Arizona. Paparo also expressed concern over the speed with which China was expanding its military. While the US
SHIFT: Taiwan’s better-than-expected first-quarter GDP and signs of weakness in the US have driven global capital back to emerging markets, the central bank head said The central bank yesterday blamed market speculation for the steep rise in the local currency, and urged exporters and financial institutions to stay calm and stop panic sell-offs to avoid hurting their own profitability. The nation’s top monetary policymaker said that it would step in, if necessary, to maintain order and stability in the foreign exchange market. The remarks came as the NT dollar yesterday closed up NT$0.919 to NT$30.145 against the US dollar in Taipei trading, after rising as high as NT$29.59 in intraday trading. The local currency has surged 5.85 percent against the greenback over the past two sessions, central
RSS