Boeing Inc. (NYSE: BA) has won a tactical victory in its $35 billion competition for the Air Force's airborne refueling tanker. Bloomberg News reports that Defense Secretary Gates notified Boeing and EADS/Northrop Grumman (NYSE: NOC) that their bids would be due after the November election.
Boeing said it wanted the delay so it would have time to prepare a competitive bid. "Boeing threatened August 21 to pull out, saying that the 767-200 plane it offered more than a year ago is now too small to 'fit the bill' in clarified Air Force guidelines. The Northrop-EADS entry, based on the Airbus A330 commercial jetliner, can carry 250,000 pounds of fuel, more than Boeing's 205,000," according to Bloomberg.
This is great news for Boeing -- but it depends on who gets elected. If McCain becomes president, EADS/Northrop will probably win since his former finance Chair is Tom Loeffler, an EADS lobbyist. But if Obama wins, the competition is likely to be decided on the merits. Regardless, for the time being Boeing has won an important tactical victory which it should savor.
Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter
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Reader Comments (Page 1 of 1)
9-10-2008 @ 1:43PM
Thomas Banks said...
Careful Mr. Cohan! You sound like Roger Moore.
If McCann wins, the decision will be rigged.
If Obama wins, the decision will be on merit.
Those are shameful, political statements.