US refueling tanker contract to go up for new bid

WASHINGTON, July 9, 2008 (AFP) – The Pentagon Wednesday reopened a 35-billion-dollar contract to produce a new generation of air refueling aircraft, acknowledging flaws in an earlier air force decision to award it to Northrop Grumman. In an embarrassing about-face, US Defense Secretary Robert Gates said Northrop Grumman and rival Boeing would be asked to submit revised bids for the tanker contract to a new Defense Department team.

“We believe that we can complete all of this and award a contract by December,” Gates told a Pentagon briefing, adding that reopening the competition would not “represent a return to the first step of a process that already has gone on far too long.”

The move comes after the US Government Accountability Office (GAO) last month backed a protest by Boeing that it had lost the deal to Northrop and European giant EADS in a flawed process.

The GAO found “a number of significant errors that could have affected the outcome of what was a close competition.”

Gates said the Pentagon would address those errors in the new process, adding “we will request revised proposals from industry.”

In an implicit rebuke to the air force, Gates also shifted responsibility for picking a winner from the air f