Boeing, Northrop duel to build tankers

A Boeing 787 Dreamliner is seen at Boeing Field In Seattle, Wash.

TEXT OF STORY

Steve Chiotakis: This week, the Air Force launches a competition to replace its fleet of aging air-refueling tankers. The contract's worth a lot -- at least $35 billion. Boeing and Northrop have been dueling over it. Now, Northrop is threatening to pull out. For some, it sounds like a rerun. Reporter Brett Neely has more.


Brett Neely: If this tanker contract were a TV show, it would be a soap opera.

The Air Force awarded Boeing a contract almost seven years ago, but then a corruption scandal shot down the deal. Then, Northrop Grumman and its European partner EADS won, but auditors said the competition was flawed. This time around, Northrop says the contract specifications are tilted against it.

Defense analyst Richard Aboulafia says the signs aren't good for Northrop.

Richard Aboulafia: This has been the most partisan defense contract in history, and their side of the competition is heavily Republican and the Boeing side is heavily Democratic.

Northrop probably can't afford to pull out.

The current tanker has been flying for 50 years, says Mark Gunzinger at the Center for Strategic and Budgetary Assessments.

Mark Gunzinger: If this one lasts another 50 years, that could be 50 years worth of contracts for sustainment, maintenance and so forth.

Both companies have launched massive lobbying campaigns to convince lawmakers. But the Pentagon says: May the best plane win.

In Washington, I'm Brett Neely for Marketplace.

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