INTERVIEW-UPDATE 2-Northrop warns against reversing tanker award

Mon Mar 31, 2008 11:08pm BST
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* Intervention could slow future military procurements

* Consequences for allies and their U.S. weapons purchases

* Boeing backers' campaign falsely says jobs go to Europe

By Andrea Shalal-Esa

WASHINGTON (Reuters) - Congressional moves to reverse the award of a $35 billion Air Force aerial tanker program to Northrop and Europe's EADS (EAD.PA: Quote, Profile, Research) could bog down procurement of future weapons and slow foreign purchases of U.S. weapons, Northrop Grumman (NOC.N: Quote, Profile, Research) Chief Executive Ron Sugar said on Monday.

"If there is an arbitrary reversal of this, I think it has very, very serious consequences for all of our allies, who buy six times as much equipment from us as we buy from them," Sugar told Reuters in an interview.

Foreign purchases of U.S. weapons helped the U.S. military work together with its allies and strengthened coalitions, he said. "The whole strategy is that we cannot go it alone in the world. We must have our allies and they must have us."

Congressional intervention to reverse a contract award was unprecedented and would slow future procurements because the military would be forced to spend even more time with lawyers trying to "protest-proof" any awards, Sugar said.

Boeing Co (BA.N: Quote, Profile, Research), which lost the Air Force competition to build 179 refueling tankers, has appealed the decision to the nonpartisan Government Accountability Office, which is expected to rule on the case by mid-June.  Continued...

 
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