Filed under: Deals, Industry, Competitive strategy, Boeing Co (BA), Politics, Northrop Grumman (NOC)
Boeing (NYSE: BA) is thumping its chest about the likelihood that it can get Congress to reverse a deal giving a $35 billion military tanker contract to Northrop Grumman (NYSE:NOC) and EADS, the parent of Airbus.
According to Reuters Mark McGraw, a company vice president, stated he was “as confident as I have the ability to be” that congressional auditors would find fault with the U.S. Air Force’s February 29 choice of the rival team. Brave words, especially when the Air Force claims that the Boeing proposal lost on each key metric for building the tanker.
Boeing is counting on members of Congress who don’t want American jobs to go overseas to push back on a contract which includes Europe-based EADS. But, it may not be that easy.
The Wall Street Journal reports that “Government contracting documents show that the U.S. Air Force preferred the size and ability of aerial refueling tankers” being offered by EADS and Northrop. The EADS Airbus 330 can carry more fuel that its Boeing competition.
Boeing is nearly certainly wasting its time. No matter how much some Congressmen would like to save jobs for their districts, they can’t be seen as favoring a deal which is probably substantially inferior.
Douglas A. McIntyre is an editor at 247wallst.com.
Entries (RSS)