Defense Dept. Puts Tanker Contest on Hold
The U.S. Defense Dept., saying it has run out of time to conduct one of the largest, most politically contentious acquisitions in military history, announced on Sept. 10 that it would end the competition for $35 billion in new aerial refueling tanker aircraft. The contract, initially won by Northrop Grumman (NOC) and European Aeronautic Defense & Space (EAD.PA), and successfully contested by Boeing (BA), will now be decided by a new President and Congress next year.
Defense Secretary Robert Gates, noting the level of politicization, emotions, and complexities that include the potential for continuing legal and political challenges, called for a “cooling off” period. He also acknowledged the military’s own mishandling of the contract. He asserted that the delay would not impair the military’s ability to do its job, due to continuing upgrading and maintenance of the existing tanker fleet, some of which dates to the Cold War era and the Air Force sought to replace—as a top priority—years ago.