Boeing Co. is considering giving up on its aerial-refueling tanker bid if the Pentagon doesn't give it six months to submit an updated proposal to better compete with the jet by Northrop Grumman Corp. and its European partner that won the original contract.
A Boeing spokesman confirmed on Friday comments made by Boeing defense unit chief Jim Albaugh in an interview. Albaugh said that the Seattle-based aerospace contractor might not make a new bid for the $35 billion contract even though Boeing's complaints about the bidding process are what caused the Pentagon earlier this year to overturn the Air Forces' decision and reopen the contract.
Boeing has concluded that the Pentagon wants an aircraft that can haul more fuel than the 767-200 variant that Boeing first proposed. But the company said working up a new bid would take longer than the 45- to 60-days it will likely get in the new bidding process. Defense officials have indicated they want to make a decision on the contract by early next year.
"I think the option we would have if we were not given the six months, there is a really high likelihood that we would no-bid the program," Albaugh told the Wall Street Journal.
The Pentagon, which presented a preliminary request for proposals last month, is scheduled to release final specs next week.
"I get a feeling that they are perhaps playing delay tactics,'' said Michael Merluzeau, an aviation consultant at G2 Solutions in Kirkland, Wash. in an interview with Bloomberg News. He speculated the company may be holding out for a Democratic presidential victory in November, which could result in an entirely new bidding process.
Los Angeles-based Northrop and its partner, Airbus parent European Aerospace Defense & Space Co., have not yet replied to the Boeing comments.
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