Top Arms Buyer: Sharing Tanker Contract Is a Bad IdeaFebruary 05, 2009

 

refuel coalition aircraft

John Young, the Pentagon's top arms buyer, rejected the idea of splitting the multibillion-dollar aerial-refueling aircraft order between Boeing and Europe's Airbus, Reuters reported.

"If you split this buy now, you have to pay two sets of development costs," said Young, undersecretary of defense for acquisition. "That totally wipes out the competitive aspects of this."

Boeing and Northrop Grumman (in a partnership with Airbus parent EADS) have been competing fiercely for a contract to build a new fleet of in-air refueling tankers that would have replaced the refueling tankers now in use for more than 50 years. With at least $35 billion at stake, the battle has become politically charged. With subsequent procurement phases, the deal could be worth a whopping $100 billion.

Bush administration Defense Secretary Robert Gates halted the competition last September to give all parties involved a cooling off period and punted the decision to the next administration.

As it turns out, Gates is again secretary in the Obama administration and now has to receive his own punt. The competition will be renewed this spring and a winner chosen by 2010. Gates also has said that splitting the buy will lead to a bad outcome.

"I would agree totally and go beyond that," Young told a small group of reporters at the Pentagon. A dual-source approach, he said, risked costing "significantly more up front and in the long term."

((U.S. Air Force photo/Master Sgt. Bill Kimble/Released)