As congressional outrage dies down, the fate of the high-profile $35 billion contract to build aerial refueling tankers now lies with the government’s accountability agency but it seems doubtful there will be a reversal of the decision.
Boeing Co. last week released its formal protest of the deal, which was awarded last month to Los Angeles defense contractor Northrop Grumman Corp. and its European partner.
In the protest, Chicago-based Boeing, which had supplied tankers to the military for almost 50 years, said the Air Force “repeatedly made fundamental but often unstated changes to the bid requirements and evaluation process.”
One change that Boeing executives said was not clear was the Air Force’s desire for a large plane, which was cited as a major factor in the ultimate decision. Boeing said if it had known the Pentagon wanted a larger plane, it would have built a tanker based on its 777 commercial airliner rather than its smaller 767.
Northrop bid a modified Airbus A330 commercial jet, which is much larger than both the current tankers and Boeing’s 767.
The government has until mid-June to issue a ruling.
Northrop partnered with the European Aeronautic Defence and Space Co., the parent of Airbus, to bid for the contract.
Northrop executives have said the competition was fair, but the company has remained relatively quiet since winning the deal to build 179 tankers, which allow fighter jets and other aircraft to refuel without landing.
Despite Boeing’s claims, many experts expect Northrop to hold on to the contract. Paul Nisbet, an analyst with JSA Research, said Boeing has a legitimate argument regarding the evaluation changes but there are strong political forces that should keep the deal in Northrop’s hands.
“It’s a close call, but it looks like the politics are against Boeing,” he said.
Presidential candidate John McCain, White House officials and other congressional leaders have supported the Pentagon’s decision. And since the winning team includes a major European company, reversing the decision would rile many of the United States’ allies.
“It would be quite a blow to international politics to suddenly reverse this,” Nisbet said.
Reconstructing Afghanistan
Tetra Tech Inc., a Pasadena-based engineering firm, won a $55 million contract last week to help reconstruction efforts in Western Afghanistan.
The company will participate in infrastructure rehabilitation, construction, agricultural development and other efforts over the next two years under the contract awarded by the U.S. Agency for International Development.
“Reconstruction is a top priority for improving the lives of the people who live in western Afghanistan,” said Dan Batrack, Tetra Tech chief executive, in a statement. “With this new contract and other recent wins, I am confident that Tetra Tech will have a strong year.”
Earlier this month, the company, which posts annual sales of about $1 billion, was awarded a contract from Miami Beach-based LNR Property Corp. and Irvine-based Hopkins Real Estate Group for construction of an $850 million mixed-use development called Avalon at South Bay.
The Carson project near the San Diego (405) Freeway will consist of more than 1 million square feet of retail space, 1,300 residential units and 300 hotel rooms.
Batrack said the company has been helping developers plan the project for three years and plans to begin work immediately. Tetra Tech will also provide maintenance services at the site through 2027. The value of the contract was not disclosed.
Bioplastic Leader
Cereplast Inc., a Hawthorne-based manufacturer of environmentally friendly plastic products, has named Randy Woelfel president and chief operating officer.
Woelfel, most recently president of Basell International, has worked for oil and petrochemical companies for 30 years.
Cereplast processes about 55 million pounds of recyclable bioplastic resin per year, but is in the process of increasing its capacity to roughly one billion pounds.
The plastic is made from soy protein or other natural substances and is becoming more popular as an alternative to plastics because of the ease of recycling.
The announcement comes as the company is beginning a partnership with Harco Enterprises Ltd., an Ontario, Canada-based plastic maker.
Cereplast will supply Harco with resin for use in spoons, drink stirrers and other items for restaurants.
Staff reporter Richard Clough can be reached at (323) 549-5225, ext. 251, or at
[email protected]
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