After four months of debates, the Pentagon announced yesterday that the bidding process for the US Air Force refuelling tankers would be reopened

After four months of debates, the Pentagon announced yesterday that the bidding process for the US Air Force refuelling tankers would be reopened. The final verdict on this $ 35Bn contract is now expected by the end of 2008, as the new competition will be “accelerated”, said Defence Secretary Robert Gates. Indeed, the selection process will not be overseen by the US Air Force anymore, but by the Pentagon’s chief weapons buyer, John Young. The KC-45, offered by EADS and Northrop Grumman, had been judged more efficient and less costly than Boeing’s KC-767 in the first round of bidding. In the meantime, Boeing has not stopped defending its proposal, saying the KC-767 allows 24% savings in kerosene consumption, compared with the KC-45. Still, Challenges magazine deems EADS and Northrop Grumman could be favoured by the new competition as its model is “more advanced” than Boeing’s. Anyway, the US plane maker now has new chances to win the deal, comments the press. Given the influence of the GAO, La Tribune says the Pentagon’s decision to follow the service’s recommendations is not a surprise. Despite this setback, EADS remains confident. Louis Gallois declared: “We look forward to starting work to deliver the world’s best tankers to our partner and the USAF”. Northrop Grumman saluted the Pentagon’s decision to go fast, but warned it would check the competition remains “fair”. In a statement, Boeing said it “welcomed the decision to reopen the KC-X tanker competition”. The group added: “However, we remain concerned that a renewed RFP may include changes that significantly alter the selection criteria as set forth in the original solicitation”. Cited by International Herald Tribune, analysts comment that the reopening of the contract does not settle the case, but clearly gives an edge to Boeing. “EADS has an excellent aircraft; it is just not politically acceptable”, assesses Richard Aboulafia, of Teal Group. Cinco Dias echoes that the competition lands into the presidential campaign, which could have an influence on the verdict. AFP (09/07), Reuters (09/07), La Tribune, Les Echos, Le Figaro Economie, Liberation, Challenges, Frankfurter Allgemeine Zeitung, Handelsblatt, Financial Times, The Guardian, The Times, International Herald Tribune, The Wall Street Journal Europe, The Seattle Times (09/07), Cinco Dias, Negocio