Giants fight for tanker deal

Jun. 24--PARIS -- Boeing and Airbus, as is usually the case, dominated much of the news at last week's Paris Air Show, touting big orders for new jetliners and taking pot shots at each other's products and business strategies. Now there's a new...


Ralph Crosby, chief executive of EADS North America, said the Air Force has put forth what appears to be a fair and open competition and that it should be decided by the aircraft that offers the most refueling capability for the buck.

"The main thing is they've opened a genuine competition," Crosby said.

A longtime defense-industry executive, Crosby formerly headed Northrop Grumman's Dallas unit before it was sold in 2000 to the Carlyle Group, which brought back the Vought name. Crosby says that his time in the Dallas area was one of the best of his career, and he speaks fondly of the Vought workers.

Crosby likes his team's chances because, he says, the Airbus plane is newer and more capable than the 767.

"The A330 has driven the 767 out of the commer- cial marketplace," Crosby said. Airbus, by contrast, has a large backlog of A330 or- ders. "Frankly, my view would be that's recognition [that] we have a superior platform."

Airbus already builds a version of the KC-30 tanker for Australia, which was at the air show, and has built smaller tankers for European nations.

Crosby also says that Boeing is way behind in delivering 767 tankers to Japan and Italy.

Boeing says it would assemble the 767 tankers on its Everett assembly line, preserving hundreds of jobs that might otherwise be lost. The aircraft would be flown to Boeing's Wichita, Kan., facility for the military modifications and testing.

Ron Marcotte, president of the Boeing division, says the age of the 767 design is irrelevant, that it will incorporate up-to-date engines, cockpit electronics and a state-of-the-art refueling boom.

The smaller 767 is "the optimal size," Marcotte says, and could fly from more and smaller airfields closer to the battles, giving the Air Force more tankers where it needs them most. He contends that the 767 burns less fuel than the bigger Airbus and will otherwise be cheaper to operate.

As for the delays with the Italian and Japanese orders for the tankers, Marcotte says those aircraft have been a good trial and that "all those lessons learned" will give the Air Force a better plane at lower cost.

EADS, which owns an 80 percent stake in Airbus, has been angling for years to get a significant toehold in the U.S. defense business, because the Pentagon annually spends more for weapons and services than most of the European nations combined.

Last fall, EADS subsidiary Eurocopter won a big U.S. Army contract to supply more than 300 utility helicopters. The bulk of those helicopters will be built at American Eurocopter's assembly plant in Golden, Miss., but the program is also bringing increased work and jobs to the company's Grand Prairie headquarters.

If it wins the tanker contract, the Northrop Grumman/EADS/Airbus team plans to build the aircraft at a new final assembly and modification center in Mobile, Ala. The project would generate more than 1,000 jobs in the area.

The team said at the air show that it was already producing one tanker at the Airbus factory in Toulouse, France, that it could deliver to the Air Force within a month or two of winning the contract.

Thompson said the Air Force is trying hard to avoid giving the appearance that international politics -- read Boeing versus Airbus -- will play any role in its decision.

But the Air Force, Thompson added, is afraid that either the Northrop/Airbus bid is so low that it can't be passed over or that Congress will try to appease both camps by splitting the order.

That latter decision would likely make the program economically inefficient for both companies and drive up the overall cost of procuring the needed tankers.

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rcox@star-telegram.com

Bob Cox, 817-390-7723

To see more of the Fort Worth Star-Telegram, or to subscribe to the newspaper, go to http://www.dfw.com. Copyright (c) 2007, Fort Worth Star-Telegram, Texas Distributed by McClatchy-Tribune Information Services. For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.


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