EADS considers bid for $35B tanker contract

If EADS decides to compete, it will go head to head with Boeing. EADS, the parent company of Airbus, was partnered with Northrop Grumman for the competition, but Northrop decided to withdraw.

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EADS's signal that it’s considering a solo bid for the more than $35 billion contract will extend one of the most intense and politically charged battles for a Pentagon program.

For EADS to compete, however, the Pentagon would have to significantly extend the May 10 deadline for the submission of the bids. EADS spokesman Guy Hicks said the extension of the deadline is "essential" in his company's decision to bid, but it is not the "only factor."

EADS on Friday issued a statement in reaction to Pentagon statements that Defense Department officials would consider a reasonable extension of the request-for-proposal (RFP) deadline and would welcome EADS's participation as a prime contractor.

"The Department has received notification from EADS North America indicating possible interest in competing for the Air Force's KC-X Tanker and we would welcome that," Pentagon spokesman Geoff Morrell said in an e-mail statement to Bloomberg News on Thursday. "If necessary, we would consider a reasonable extension to the RFP deadline. That is not unusual."

Morrell did not indicate what the Pentagon considers a reasonable extension to the deadline.
 
“Yesterday the U.S. Department of Defense indicated it would welcome a proposal from EADS North America as prime contractor for the KC-X tanker competition," Hicks said in a statement. "This is a significant development. EADS is assessing this new situation to determine if the company can feasibly submit a responsive proposal to the department’s request for proposal."

Northrop Grumman's decision to withdraw from the contest has rankled European officials who made charges that the United States was acting in a protectionist manner by favoring Boeing in the contest. European governments have criticized the U.S. over the process used to pick the tanker contractor.

When it backed out, Northrop argued that the Pentagon's criteria were stacked against the company because the department favored a smaller plane. Boeing's offering, the 767, is a smaller aircraft than the Airbus 330 that Northrop and EADS planned to offer.

In his Friday statement, Hicks indicated that the size of the aircraft the Pentagon wants is still an issue for EADS.

"While this development is a positive sign that the DoD seeks competition, it does not address EADS’s underlying concerns that the RFP clearly favors a smaller, less capable aircraft, and that the additional combat capability offered by our system may not be fully valued," Hicks said.

— This article was updated at 10:30 a.m.