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Boeing in line to get air tanker contract as Northrop Grumman to withdraw

Boeing apparently will win by default the big contract to build a new generation of mid-air-refueling tankers to replace the aging Boeing KC-135s that have been stationed at Grand Forks Air Force Base for a half-century.

Boeing apparently will win by default the big contract to build a new generation of mid-air-refueling tankers to replace the aging Boeing KC-135s that have been stationed at Grand Forks Air Force Base for a half-century.

News sources, including The New York Times and The Washington Post reported Monday -- and U.S. Rep. Earl Pomeroy, D-N.D., told the Herald on Monday afternoon -- that Northrop Grumman Corp., as it has promised for months, will withdraw from the bidding competition. That leaves Boeing alone as a possible maker for the new generation of tankers that Pentagon officials say are more important than ever in a worldwide effort of asymmetrical warfare dependent on a variety of aircraft and rapid movement.

Pomeroy said Northrop Grumman withdrawing is good news for the Grand Forks base because it means Boeing more quickly will get the contract and begin building new tankers. And that will quicken the chances they will get assigned here, despite the Pentagon's realignment of the base several years ago, Pomeroy said.

Only a dozen KC-135s remain at the base and they are scheduled to be transferred out by the end of the year. The new mission of unmanned aerial vehicles will bring about 950 personnel to the base, about the same as will leave with the last tanker squadron.

The Pentagon took away the base's tanker mission in the base realignment in 2005, ranking the base the lowest in military value of any of the KC-135 bases. It is part of the change-over from the Cold War strategy of stopping a first-strike over the top of the world.

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But Pomeroy and the state's two senators, Kent Conrad and Byron Dorgan, both Democrats, have said they have clear signals from Air Force leaders that the base still may yet get a fleet of the new tankers and say they will keep pushing the idea.

The $40 billion contract for a new fleet of tankers is one of the biggest military procurement deals ever and has had a six-year history of misfires, corruption and arrests over the process. It could become as big as $100 billion, experts say, and is aimed at building 179 new tankers.

Boeing began building the KC-135 generation in the 1950s.

Northrop Grumman, with its European partner, EAD, which builds the Airbus, has said the latest contract specs are unfairly weighted toward Boeing's type of aircraft. The Pentagon has maintained both possible bidders are considered equal contenders with similar chances of winning the bid.

Northrop Grumman won the bidding in 2008, only to have the deal overthrown amid charges the provisions were too unfair to Boeing.

Pomeroy called today's news "a significant development."

"The ability of the United States Air Force to proceed to let bids for tanker construction has been held up with one thing after another for several years," he told the Herald. "The urgent need for the Air Force to get new tankers into their mix has been delayed by politics and bidding construction and some missteps by the Air Force itself. The result of it has been very unfortunate. We're flying very old tankers. We need new tankersWilliam Lynn, deputy secretary of defense, put out a statement:

"We are disappointed by Northrop's decision not to submit a bid for the U.S. Air Force tanker replacement program."

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"In the last tanker replacement (KC-X) competition, Northrop Grumman competed well on both price and non-price factors," Lynn said. "We strongly believe that the current competition is structured fairly and that both companies could compete effectively."

Some groups called for both manufacturers to share the contract, each building aircraft, because that would employ more workers.

Although Northrop Grumman's plan was criticized by some because it's European partner would mean some of the work might be done overseas, the company promised to build its new tanker primarily in a new plant in Alabama.

Lynn said the Pentagon adjusted the contract specifications to accommodate "out-year risk" to the manufacturers, but wouldn't change "the war-fighters' requirements to accommodate either" bidder.

The Pentagon also said it was not prejudiced against a manufacturer with overseas links.

Pomeroy said a bidding competition could have slowed the process by a year or more before new tankers would get built.

With today's news, Boeing should quickly be able to get production going much quicker, he said.

"Now, this is of great interest to Grand Forks because we have assurance from the senior levels of the Air Force that new tankers would be placed in Grand Forks," Pomeroy said.

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That's despite the Pentagon's Base Realignment and Closure round that decided in 2005 Grand Forks would lose its tanker mission.

"And so the BRAC round made a terrible decision in taking the old tankers away," Pomeroy said. "But we have a base that's primed to be, I believe, a prime host site for the new tankers.

"We want to get these built first of all because the (military) needs them and secondly because we think Grand Forks will play a role in hosting the new tankers once they're into the Air Force."

Reach Lee at (701) 780-1237; (800) 477-6572, ext. 237; or send e-mail to slee@gfherald.com . Reach Johnson at (701) 780-1105; (800) 477-6572, ext. 105; or send e-mail to rjohnson@gfherald.com .

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