Pentagon Delays $35B Tanker Deal for Next President

Environment too 'highly charged' for fair process; Boeing gets time to rework plan
By Kevin Spak,  Newser Staff
Posted Sep 10, 2008 11:58 AM CDT
In this artist's depiction provided by Northrop Grumman Corp., a KC-45A refuels a B-2 stealth bomber.    (AP Photo)
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(Newser) – The Pentagon has put a $35 billion contract for new Air Force refueling tankers on hold, Defense Secretary Robert Gates announced today, reasoning that the White House didn’t have enough time left to “complete a competition that would be viewed as fair.” The contract was awarded to a European-American partnership, but US-based Boeing successfully contested that decision, in part thanks to public outcry.

“Reason finally prevailed,” one analyst told Bloomberg, calling the delay “the right thing to do.” The reprieve gives Boeing more time to get its proposal in order, and a victory by Barack Obama might give an edge to the jet-maker headquartered in his home state. John McCain might instead favor Northrop Grumman; McCain spearheaded a 2004 investigation into Boeing that put the contract up for grabs.