Northrop Grumman Drops Tanker Bid

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The next-generation military tanker will almost certainly be a Boeing. Northrop Grumman announced Monday it would not be submitting a bid in the $35 billion sweepstakes to introduce a replacement for the KC-135 and KC-10 fleet. Boeing's bid is riding on a modified 767 platform while Northrop Grumman would use an A330 modified in the U.S. Northrop Grumman CEO Wes Bush effectively threw in the towel on the protracted battle. He said the company "will not protest" the outcome of the competition, which now appears to be down to one. Bush did suggest the odds were stacked in favor of Boeing, however. "We reached this conclusion based on the structure of the source selection methodology defined in the RFP, which clearly favors Boeing's smaller refueling tanker and does not provide adequate value recognition of the added capability of a larger tanker, precluding us from any competitive opportunity," Bush said.

The capitulation by Northrup Grumman bodes well for Boeing's base in Washington State. A successful bid will mean a long-term extension of the assembly line for a commercial airliner that is nearing its commercial life expectancy. The tankers will be built over the next 20 to 30 years.