Pentagon, EADS describe U-turns on tanker deal

Washington: The Pentagon and European aerospace and defence giant EADS are now executing gentle banking turns towards each other on the $50 billion US Air Force tanker deal after a mutual unceremonious brush-off just a week or so ago. At play are several factors which are strong drivers for a rapprochement between the two sides.

The A330 Multi-role Tanker Transport
In a statement the Pentagon said that EADS has expressed possible interest in continuing to be a contender in the race for the multibillion-dollar contract for aerial refuelling aircraft despite the end of a trans-Atlantic partnership it had formed for the bid. EADS partner Northrop Grumman opted out of the tender last week contending that the whole process was hopelessly skewed in favour of rival Boeing.

Northrop's decision results in rival Boeing being positioned clearly to walk away with the contract to build 179 tanker planes, potentially worth up to $50 billion. It also means an end to EADS dream of becoming a major player in America, the world's largest and most profitable arms market.

On Thursday, EADS chief executive Louis Gallois let drop a loud hint suggesting that the game may not be over as yet saying his firm was yet to make a decision whether or not to re-enter the bid. However, any such move, he said, would require the Pentagon to extend a 10 May deadline for bid submission.

"In the present time frame, I could say it's almost impossible," he told reporters in New York. "In the present time frame ­­- 60 days - impossible."

Gallois also clarified that his firm had not sought other partners for a fresh bid or been contacted by others.