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US to oversee EADS contract

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Yahoo News:

Boeing Co. and Northrop Grumman Corp. will submit new offers for a disputed $35 billion Air Force tanker contract, and the Pentagon will pick a winner by the end of the year.

Defense Secretary Robert Gates said Wednesday that his office — not the Air Force — will oversee the competition between Boeing and the team of Northrop and Airbus parent European Aeronautic Defence and Space Co.

The plan, which hands control to Pentagon acquisition chief John Young and sets up a dedicated source-selection committee, is the latest illustration of senior Defense Department civilians lack of confidence in the Air Force’s ability to manage the contract.

Many lawmakers embraced the action, but analysts questioned the Pentagon’s aggressive timetable.

The Government Accountability Office last month detailed “significant errors” the Air Force made in the original award to the Northrop team. The GAO said Chicago-based Boeing, which protested the deal, might have won had the service not made mistakes in evaluating the bids.

The Pentagon now will conduct a limited rebid that looks only at eight issues where government auditors found problems in the initial process, Gates said.

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