Lockheed protests US Navy deal, Boeing holds off

Tue May 6, 2008 8:06am BST
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By Andrea Shalal-Esa

WASHINGTON (Reuters) - Lockheed Martin Corp (LMT.N: Quote, Profile, Research) on Monday appealed a huge U.S. Navy contract for an unmanned patrol plane won by Northrop Grumman Corp (NOC.N: Quote, Profile, Research), but Boeing Co (BA.N: Quote, Profile, Research), the other losing bidder, said it would not protest.

Defense officials say such protests are becoming more and more common, given fierce competition for a shrinking number of big weapons contracts and the increased size of each of them.

Boeing, for instance, is embroiled in a protest of a $35 billion Air Force contract it lost to Northrop in February.

Lockheed said it decided to file a protest with the U.S. Government Accountability Office (GAO) after Navy officials told the company its proposal met the technical requirements and cost significantly less, said spokeswoman Tierney Helmers.

Northrop beat out Lockheed and Boeing last month to win the Broad Area Maritime Surveillance contract with a proposal based on its high-altitude unmanned Global Hawk, which has been used extensively over Iraq and Afghanistan. The deal is worth at least $3.74 billion in the longer term, the Navy said.

Bethesda, Maryland-based Lockheed said it filed protests rarely, but it successfully challenged a $15 billion Air Force helicopter contract awarded to Boeing in 2006.

In that case, the GAO twice upheld protests filed by Lockheed and the other losing bidder, United Technologies Corp (UTX.N: Quote, Profile, Research) unit Sikorsky Aircraft.

The congressional agency, which reviews federal contract disputes, confirmed it had received Lockheed's protest and said a decision was expected by Aug. 13. A spokesman said the protest would trigger a stop-work order from the Navy.  Continued...

 
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