Northrop reportedly won't bid on air tanker contract

WASHINGTON — Northrop Grumman will announce that it won't bid on a $35 billion contract to start replacing the Air Force's aging fleet of aerial refueling tankers, Rep. Norm Dicks, D-Wash., confirmed Monday.

The decision by Northrop Grumman doesn't automatically mean that Boeing — which has battled a team of Northrop Grumman and the European Aeronautic Defense and Space Co. to replace the tankers — will win the contract. There were reports that EADS, the parent company of Airbus, might consider bidding, but Dicks said he didn't think that was likely.

Northrop Grumman is expected to make its announcement after the financial markets close Monday.

It had teamed with EADS and offered a tanker based on an Airbus A330 airframe. Boeing's tanker would use a 767 airframe.

Dicks, who is about to become the chairman of the House Appropriations Committee's Defense Subcommittee, said he expected the Pentagon to award the contract to Boeing without a competition, as Defense Secretary Robert Gates previously had indicated might happen if there were only one bid.

"This is very good news," Dicks said. "We are very excited about this."

The congressman discounted the possibility that EADS would proceed solo.

"Without an American face on this, I don't see how EADS could do this on its own," he said.

Dicks also suggested that once the tanker was in production, he expected Boeing would consider increasing the number being built from 15 to 20 or 25 a year.

When the Air Force released its "request for proposals" in late February, there apparently were few major changes from an earlier request that drew sharp criticism from the Northrop Grumman-EADS team and its supporters on Capitol Hill.

Northrop and EADS officials didn't indicate at the time what they planned to do, but Northrop officials earlier said the company wouldn't bid unless significant changes were made to the request for bids.

The initial contract is for 179 tankers, but the deal eventually could be worth $100 billion as the Air Force replaces about 600 Cold War-era tankers in what could be one of the largest Pentagon purchases ever.