GE gets win out of Northrop deal with military


Despite the hue and cry that American interests were hurt when the U.S. military gave its new tanker order to Northrup Grumman Corp. (NYSE: NOC) and EADS, the parent of Boeing Co. (NYSE: BA) rival Airbus, one big company based in Connecticut did very well. That would be General Electric Co. (NYSE: GE).

According to the Business Courier, "the planes will be powered by GE's CF6 jet engines." Due to the large number of planes involved, GE will build 400 engines and bring in about $5 billion.

The news adds to the economic complexity surrounding the politics of the contract. A number of congressmen believe that a company based in France, EADS, should not be building planes for the U.S. military. Picking Boeing, based in Chicago, would have been a more patriotic decision.

But, the math may not be all that simple. Northrop Grumman is clearly a U.S. company, and GE is getting a huge contract. There is no saying that Boeing might not have used Rolls Royce engines and other significant components from other countries.

The military award may be better for U.S industrial interests than most people think

Douglas A. McIntyre is an editor at 247wallst.com

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