Boeing is debating whether to pull out of a competition for U.S. Air Force tankers, leaving EADS as the sole bidder, according to the Air Force Times.
Boeing executives are privately considering whether Boeing can win the contract and make a profit, a senior Boeing executive told the Air Force Times.
But Boeing spokesman William Barksdale tells Air Capital Insider that the company is still planning to bid.
“We announced March 4 we intended to bid,” Barksdale said. “That’s the position we still have.”
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Congressional leaders and others have complained that illegal subsidies to EADS would lower the price of the Airbus aircraft. And company officials have complained that the Pentagon now appears to be favoring the European company.
“(Boeing CEO) Jim (McNerney) doesn’t want to be in a position that we are going to bid a losing bid,” the Boeing executive told the Air Force Times. “It gets difficult when you’re dealing with a competitor who has flat-out said on several occasions that they’re going to underbid us. How can they do that if the list price of their airplane is higher than the list on our plane? Because they are subsidized and we’re a for-profit company. So the question we’re asking is: How do we compete against four governments?”
Lexington Institute Loren Thompson, however, says what policymakers are probably trying to do is give EADS an adequate incentive to stay engaged in the bidding process.
“But,” Thompson said, “if they go too far in helping the Europeans, the next round of tanker competition will be stillborn.”