Senior EADS executives say negotiations have stalled for the UK's Future Strategic Tanker Aircraft deal, perhaps delaying final contract award by six months. But the company also hopes to exploit a similar delay for a controversial tanker acquisition programme in the USA.
Earlier this year, the UK Ministry of Defence (MoD) eliminated a Boeing proposal for the FSTA contract, continuing negotiations only with EADS.
The goal of the negotiations now is to define the terms for EADS to receive "preferred bidder" status, a prelude to formal contract talks. The deal was expected to be signed next summer, but both Philippe Camus, co-CEO of EADS, and Sir Jeremy Blackham, EADS UK country president, now expect an award at the end of the year.
Complicated
The spirit of the negotiations appears to shift each week. Two weeks ago, says Camus, the negotiators seemed to be in full agreement, but the mood has badly deteriorated in recent days. Complicating the process has been the difficulty of defining the terms for the UK's complicated private finance initiative, says Blackham, a former head of acquisition for the MoD.
In the US, meanwhile, EADS North America chief executive Ralph Crosby says a capture team has been formed to build a proposal in advance of a potential competition for the US Air Force's KC-X tanker requirement. USAF officials are now analysing options for a competitive award several months after a signed lease-buy deal to Boeing was nullified in the wake of revelations of improper conduct involving two senior executives closely linked to the deal.
EADS says its proposal must increase the amount of US content in the A330-200 tanker to at least 50%, a 10% increase, and is pursuing relationships with new US suppliers. Options include opening a new final assembly centre in the US, as well as offering avionics and other A330 components to US suppliers.
STEPHEN TRIMBLE
Source: Flight Daily News
