EADS won't reveal new tanker bid partner

LONDON, June 3 (UPI) -- European military giant EADS is playing hard to get when it comes to announcing a new U.S. partner for a multibillion-dollar contract to outfit the U.S. Air Force with new refueling aircraft.

Louis Gallois, the chief executive officer of European Aeronautic Defense and Space Co., the parent of European plane maker Airbus, told the Financial Times that EADS has already selected a key supplier from the United States as its new partner in the bid. He added, however, that he would not yet reveal the name of the company to avoid political pressure.

"We are not giving the name because we don't want to put them under pressure," Gallois told the newspaper.

Companies including the United States' Raytheon and L-3 Communications, as well as Britain's BAE Systems have in the past been mentioned as possible partners in the bid.

Yet Gallois also said EADS would not need another big partner to bid for the $45 billion contract for 179 planes, so the company referred to in his remarks to the Financial Times could be a supplier for specific equipment sensitive to U.S. national security.

EADS' U.S. rival Boeing has many potent backers in Congress, and Gallois could fear that they would pressure that company into giving up as well.

EADS had selected Los Angeles company Northrop Grumman as a large partner, but NG pulled out of the race in March, arguing the bidding conditions clearly favor rival Boeing.

EADS returned to the competition alone after being granted a 60-day extension on the bidding deadline.

The Europeans are throwing their KC-45 tanker, a large plane based on the Airbus A330, in the race; Boeing is bidding with an altered version of its 767, called New Generation Tanker.

The Generation Tanker is slightly smaller and probably cheaper than the KC-45; the European plane has logged more flight testing hours and is closer to serial production, experts say.

The final bid is due by July 8, with U.S. officials to award the contract in the fall.

The bidding war goes back several years.

The KC-45 won the contract in February 2008, but the decision was overturned four months later by the Government Accountability Office after Boeing challenged it. The GAO said it found problems with the bidding and the contract is up for grabs.

Moreover, both sides are accusing each other of profiting from illegal government subsidies.