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Inouye studies splitting tanker deal


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POSTED: Tuesday, June 09, 2009

U.S. Sen. Daniel Inouye, chairman of the Appropriations Committee, said he has not ruled out directing the Pentagon to split its purchase of aerial refueling tankers between Boeing Co. and Northrop Grumman Corp.

Inouye said he has received industry reports suggesting splitting the contract would achieve “;massive”; savings of up to $42 billion when buying at least 360 aircraft over 30 years.

“;I just can't ignore these things,”; said Inouye, D-Hawaii. “;I want to make sure the fleet we provide is the finest we can get for the buck.”;

Inouye's panel is one of two that appropriates money for defense. His counterpart in the House, Rep. John Murtha, D-Pa., has said he favors splitting the buy to prevent further delay in the effort to replace a fleet of tankers in use since 1956.

Chicago-based Boeing lost the original $35 billion tanker contract in February 2008 to Los Angeles-based Northrop and its teammate, Airbus SAS parent European Aeronautic, Defence & Space Co. Boeing successfully protested, and Defense Secretary Robert Gates postponed a rebid in September until the new administration took office.

Air Force Secretary Michael Donley said last week the service hopes to issue a formal request for proposals by August after Gates approves a strategy for the new bidding.

Gates has opposed splitting the program. “;It's bad public policy and bad acquisition policy,”; he said on March 18.