Boeing reviews options on tanker bid

Boeing is reviewing its options following the Air Force's decision to extend the deadline in its refueling tanker contest to accommodate the European Aeronautic Defence and Space Co.

"We are deeply disappointed with EADS-Airbus efforts to further delay this vital warfighting program and tilt the U.S. procurement process in its favor," Boeing said in a statement Thursday.

Wednesday, the Pentagon said it would bump back the deadline for bids for a $35 billion tanker contract if EADS asked. Pentagon spokesman Geoff Morrell said the Air Force would move the deadline from May 10 to July 9, a 60-day extension, should EADS formally request it.

EADS' partner, Northrop Grumman, dropped out of the contest March 8, leaving EADS to decide whether to go it alone. The European parent company of Airbus, EADS had been asking for a 90-day extension as the minimum amount of time needed to submit a bid.

Thursday, Boeing said it does not see a legitimate reason for granting an extension.

"We believe an extension that favors any individual competitor does not further the goal of ensuring fair competition," Boeing said.

In light of the Pentagon's decision and a recent trade ruling against Airbus, Boeing said it will review all of its options for going forward.

Defense analyst Loren Thompson of the Lexington Institute said he thinks he knows what Boeing means.

"If it feels that anything is being done to advantage its competitor, it will file a protest or take other legal action," Thompson said.

In 2008, Boeing protested to the Government Accountability Office when the Air Force initially awarded the contract to EADS and Northrop. The GAO found numerous flaws with that contest leading the Pentagon to throw out the contract with Northrop.

This is the Air Force's third attempt at replacing its KC-135 tankers.

Thompson predicted that EADS will not bid. Northrop pulled out because it felt that the bidding process was tilted toward Boeing, and that process hasn't changed, Thompson said.

Virgin Blue to buy 105 new Boeing planes — Budget carrier Virgin Blue said Thursday it would buy up to 105 new Boeing 737s, the biggest order in its history.

The price was not released, but CEO Brett Godfrey said the deal was completed on "attractive commercial terms." He said financing was expected to be completed soon.

Virgin Blue Holdings, Australia's second-largest airline, said the Boeing deal includes firm orders for 50 737-800NG aircraft, 25 additional firm delivery positions secured as options and 30 future purchase rights. The 50 planes on firm order can be converted to either 737-700 or 737-900 models.

Delivery of the new planes is scheduled from June 2011 through 2017.