Defense Measure Would Protect Boeing
The House Armed Services Committee voted in effect to shield Boeing Co. from competition from Europe’s largest defense contractor for a projected $50-billion U.S. aerial-refueling aircraft market.
The measure approved by the panel Thursday did not name European Aeronautic Defense & Space Co., which wants to offer a tanker version of its Airbus unit’s A330 jet to the U.S. Air Force.
But the measure would bar the acquisition of a major weapons system from any foreign company that gets what the U.S. has protested as a government subsidy prohibited by the World Trade Organization.
Chicago-based Boeing stands ready to compete for a tanker contract “under whatever terms the Department of Defense and the Air Force define,” said Douglas Kennett, a company spokesman.
A spokesman for EADS’ North America unit, Guy Hicks, said, “This is a government-to-government issue and needs to be resolved at that level.”
“EADS North America is committed to contributing to the nation’s defense and will continue to invest in the U.S. to meet that objective,” he said.
Last year, the U.S. filed a WTO case challenging French, German, British and Spanish government loans to Airbus for the development of new aircraft. Airbus overtook Boeing in 2003 as the world’s largest supplier of commercial aircraft.
The measure that would shield Boeing was part of the fiscal 2006 defense authorization bill adopted by the panel Thursday. Approved 61 to 1, the $441.6-billion bill is expected to be considered on the House floor next week. The Senate version does not contain such a provision.
A news release highlighting provisions of the bill omitted the prohibition of procurement from companies receiving banned foreign subsidies. The measure was offered as an amendment by the panel’s chairman, Rep. Duncan Hunter (R-El Cajon).
Last year, after a procurement scandal, Congress killed a $23.5-billion Air Force plan to lease and buy 100 Boeing aircraft for aerial refueling.
Since then, Pentagon leaders have said they would hold a competition for any tanker purchases. The Air Force is studying whether to upgrade or replace its fleet of more than 530 tankers.
The competition has been expected to start next year.
