Boeing wins $35 billion Air Force tanker contract
St. Louis Post-DispatchFebruary 24, 2011
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WASHINGTON • The Air Force has awarded a $35 billion contract to build the next generation of air refueling tankers to Boeing Co.
"Boeing was a clear winner," said Deputy Secretary of Defense William Lynn said in response to reporter's questions following the announcement.
The announcement was made at the Pentagon late Thursday afternoon after the financial markets closed. It was certain to be welcome news in Washington state and Kansas, where much of the work on the tanker will be done.
Oversight of tanker construction will come from Boeing's Defense, Space and Security division, headquartered in St. Louis County.
"This contract award would not have been possible without the hundreds of Boeing employees across the entire company, and the thousands of our industry teammates, who remained laser-focused on our commitment to offer a solution that is first in capability and best in value," said Dennis Muilenburg, president and CEO of Boeing Defense, Space & Security in a prepared statement.
The decision dealt a blow to the European Aeronautic Defence and Space Co., which also had bid for the contract. It was a major disappointment for Alabama, which had been counting on the work at a long-shuttered military base in Mobile.
Lynn would not rule out an official challenge to the winning bid by EADS. Boeing appealed a 2008 Pentagon decision to award the tanker contract.
That appeal led to the reversal in Boeing's favor announced Thursday.
Gen. Norton Schwartz, the Air Force Chief of Staff, said he hopes the announcement marks the end of a procurement process that has dragged on for nearly a decade.
"We'll get a capability is long overdue and we'll stop talking about it," said Schwartz.
The Force has tried for nearly a decade to replace its aging fleet of Eisenhower-era tankers, the equivalent of a flying gas station.
"The Air Force is in desperate need of a new air refueling tanker. The first of these planes was bought the same year that color television was introduced in the United States. Asking airmen to fly a plane that may be older than their parents is simply unacceptable," said U.S. Rep. Todd Akin, R-Missouri, whose district includes the Boeing defense division.
The Boeing assembly team will be comprised of 800 suppliers in 40 states.
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