EADS hunts US partner in military contract

21st April 2010, Comments 0 comments

European aerospace giant EADS still hopes to beat Boeing to a huge military aircraft contract, despite rejoining the race without yet finding a US partner, its top manager said on Wednesday.

Chief executive Louis Gallois told reporters that EADS had announced its re-entry into the drawn-out contest "because we have a chance of winning."

EADS said it would bid on the 35-billion-dollar (26-billion-euro) deal to supply the US Air Force with 179 aerial refuelling tankers.

The European company and its former US partner, Northrop Grumman, dropped an earlier offer, complaining that the Pentagon had skewed the contract terms in order to favour EADS's arch-rival, Boeing.

"Our product is the best, it already exists, and we are up against a plane that is less capable and which does not yet exist," Gallois said, referring to the designs of the unbuilt Boeing plane.

The plane offered by EADS is already in production, built by France-based plane maker Airbus, which EADS owns. Gallois said however that it still lacks some special parts which it needs a partner company to provide.

It is now "indispensable" for EADS to "find a partner who can offer us delicate components and integrate them into our plane," Gallois said.

"We are in discussion with certain businesses that could play this role," he added, without naming them. EADS previously held talks with the US companies Raytheon and L-3 and the US arm of British firm BAE Systems.

Officials in Washington told reporters that US firms including General Electric, Honeywell, Hamilton Sunstrand and Goodrich would serve as sub-contractors for EADS.

Tuesday's announcement revived a long-running contest between EADS and Boeing, which has been plagued by scandal, intense lobbying in Congress and transatlantic tensions.

Industry analysts said EADS faced long odds in trying to beat out Boeing, which could offer a lower price for its smaller plane.

"The price will be a decisive question," Gallois acknowledged.

© 2010 AFP

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