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The Real Story - Northrop vs. Boeing Tankers

Mike

Well-known member
Friday, September 19, 2008 By GEORGE TALBOTPress-Register
WASHINGTON, D.C. — Northrop Grumman Corp.'s bid for the U.S. Air Force tanker contract was almost $3 billion cheaper than the offer from rival Boeing Co., according to the Pentagon's chief weapons buyer.

John Young, the Under Secretary of Defense for Acquisition, told the Washington Post in an article published Thursday that Northrop offered to produce the first 68 tankers under a 179-plane contract for a cost of $12.5 billion. Boeing's offer, he said, was $15.4 billion.

That's an average of about $184 million per plane for Northrop, compared to about $226 million apiece for Boeing. Young said the difference was notable because Northrop's KC-45 tanker, which would be assembled in Mobile, is a larger and more versatile aircraft than the KC-767 offered by Boeing.


"Frankly," Young said, Boeing's tanker "was smaller and should have been cheaper. . . . A member of the American public might conclude that Boeing sought to charge more than the De fense Department reasonably expected" to pay.

Los Angeles-based Northrop offered a KC-45 tanker based on an Airbus A330 commercial airframe. The tankers would be assembled in a $600 million, 1,500-worker factory to be constructed at the Brookley Field Industrial Complex.

Chicago-based Boeing offered a KC-767 based on its 767 commercial jet. The planes would be assembled in Everett, Wash., and modified for military use in Wichta, Kan.

Young said the tankers offered by both companies were "technically outstanding." But he said the KC-45 "provided more tanker capability and (fuel) offload rate and was substantially cheaper to develop."

Young said Northrop and its bidding partner, the European Aeronautic Defense and Space Co., also promised to deliver their planes more quickly than Chicago-based Boeing.

Young's comments marked the first time he or any other Pentagon official involved in the competition disclosed details about the two bids.
 
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