In order to snatch the lucrative U.S. Air Force tanker contract, Boeing and its European rival EADS have spent nearly $125 million on lobbying in the past years.
Boeing and European Aeronautic Defense and Space Co., the parent of European plane maker Airbus, have been locked in a 9-year battle over a $40 billion contract to outfit the Air Force with 179 in-flight refueling tankers. For EADS, winning the contract could mean gaining a stronger foothold in the world’s largest military market. Naturally, Boeing wants to prevent that.
In a bid to increase chances for their respective bids, the companies have spent more than $100 million on lobbying U.S. decision makers, figures from OpenSecrets.org, which tracks lobbying in U.S. politics, indicate.
Boeing during the past four years spent $54 million on lobbying efforts. EADS and its U.S. partner Northrop Grumman in the same period spent nearly $70 million on lobbying, OpenSecrets.org says. Northrop Grumman pulled out of the bidding in March, arguing the bidding conditions clearly favor rival Boeing.
Moreover, the companies spent several millions touting their planes in ads in newspapers, magazines and broadcast outlets.
Both Boeing and EADS this week submitted their official bids for the contract, a move that is linked to even more costs. The Hill, a Washington newspaper, reports that EADS North America spent $75,000 on printing its bidding materials. The company printed 50,000 pages — six copies of its bid of more than 8,000 pages. Each set weighs around 100 pounds, the newspaper reports.
The Air Force has been eager to replace its Eisenhower-era tankers and is to announce a bid winner this fall.
The Europeans are throwing their KC-45 tanker, a large plane based on the Airbus A330, in the race. Boeing is bidding with an altered version of its 767, called New Generation Tanker.
The Generation Tanker is slightly smaller and probably cheaper than the KC-45; the European plane has logged more flight testing hours and is closer to serial production, experts say.
Both companies have argued that winning the contract would create and support thousands of U.S. jobs, in a bidding war that goes back several years.
The KC-45 won the contract in February 2008 but the decision was overturned four months later by the Government Accountability Office after Boeing challenged it. The GAO said it found problems with the bidding and the contract is up for grabs.
Moreover, both sides are accusing each other of profiting from illegal government subsidies.
— Published: July 14, 2010 at 8:45 AM © 2010 United Press International, Inc. All Rights Reserved.
