Tanker News 18 July

The following tanker related items caught our eye:

The Guardian: EU leaders lobbied White House on tanker contract
Key Passage:

European newspapers have reported for months that Brown, Sarkozy and Merkel have lobbied Bush, writing letters and raising the issue in direct talks.

Initially the leaders lobbied for the contract and more recently, according to the latest reports, they have expressed concern that the Pentagon decision to reopen the tanker competition could jeopardise Airbus jobs in Europe.

"He will support the Airbus bid in any way he can," an unidentified spokesman for Brown told The Times of London last week, adding that 11,000 jobs were at stake in Britain, where the wings for the A330 are built.

According to a report in the International Herald Tribune, Tom Enders, a top EADS executive, accompanied Merkel to one meeting with Bush at the White House.

TWB has witnessed how the KS and WA Congressional delegations have been panned for merely standing up for the home team. How is it that the European politicians get no criticism for their near constant lobbying for EADS? (Thanks to George H. for sending us this article.)

CNBC: Protectionism Not Good in Tanker Deal
Key Passage:

Northrop Grumman CEO warned of a "political overlay" in the US defense procurement procedure, where, he said, a small number of members of Congress were merely looking out for their constituencies, particularly to keep jobs in their districts.

Both executives stressed that the aerospace industry is becoming increasingly global and that EADS should be not be viewed through protectionist lenses.

EADS should be "considered as an American citizen," Gallois said.

If Gallois really wants EADS to be considered an American citizen he should demand the quick passage of Rep. Tiahrt's Tanker Recompete Act. That way his company will finally be treated like a US company. It will also be held accountable for US laws/regulations including cost accounting standards, Buy America provisions, specialty metal provisions, the Foreign Corrupt Practices Acts, and compliance with the International Traffic in Arms Regulation.

Our guess is that he wants all the benefits of citizenship without the responsibilities. At Tanker War Blog we believe, based on its well documented shady past alone, EADS should not even be issued a tourist visa to get into the country, much less be able to apply for citizenship. (Thanks to Bobby L. for sending us this article.)

Reuters: Airbus writes off 9-year-old Saddam plane order
Key passage:

Nine years after France's top plane executive shook hands in Baghdad on a $500 million deal to sell airliners to the government of Saddam Hussein, Airbus finally conceded on Thursday the deal was off.

Airbus sales chief John Leahy ordered the deal removed from its backlog in response to an inquiry from Reuters about the long-forgotten deal at this week's Farnborough Air Show.

The deal to supply five A310 passenger jets had been on the Airbus order book since its then director Jean Pierson clinched the deal in 1989, as Iraq's skies reopened following travel curbs imposed during its eight-year war with Iran.

We admit that this article is not tanker news, but it was too interesting to pass up. The deal looks more like it was 19 years ago rather than 9, but maybe they kept moving it forward on their books. In the article Airbus complains that they did not get to bid on the last Iraqi plane contract. No kidding; perhaps the Iraqis remembered France opposed their liberation and was heavily involved in propping Saddam up with the oil-for-food scandal.

Tanker Whispers

Nothing gets D.C. more excited than a good whisper campaign, and it seems the KC-30 team is trying hard to titillate the K-Street crowd with their latest doozy.

For those fortunate enough to live outside the beltway and not familiar with whisper campaigns, the following is a pretty good description from Wikipedia:

A whisper campaign is a method of persuasion in which damaging rumors or innuendo are spread about the target, while the source of the rumors seeks to avoid being detected while spreading them (for example, a political campaign might distribute anonymous flyers attacking the other candidate). It is generally considered unethical in open societies, particularly in matters of public policy.

In one of their daily e-blasts the KC-30 team suggests Boeing is willing to spend an astounding $250 million to overturn the tanker decision. For this number they cite a National Journal article written by Bara Vaida.

It is reveling though that in the article the only sources for the $250 million figure are a spokesman from EADS NA and a senior VP at Northrop. Here is the passage in the article:

“We’ve heard [the number] through an Air Force source and a couple of other Hill sources,” said Sam Adcock, senior vice president of government relations at EADS North America. Northrop spokesman Randy Belote said he, too, has “heard that number thrown around.” A spokesman for the Air Force said that it “is not aware of the specifics” on how much Boeing is spending on its protest.

We can almost imagine these two going on and on about how they hear this $250 million number in conversations all over town, when they are probably the only ones doing the talking.

The article's author deserves some credit for being able to see right through this and he asks:

Is the quarter-billion-dollar figure realistic, or is it being talked up as part of a strategy to counter Boeing? Doug Kennett, a Boeing spokesman, said the $250 million number is “so ridiculous that you almost don’t want to respond to it.”

In this case, ridiculous may be an understatement. The consensus at Tanker War Blog is that at most the eight figure mark will be broken, and it will probably be on the low end of that. Also, regardless of what Boeing spends, in the end, they will be outspent by NG and EADS. After all, at this point it's the KC-30 team's contract to lose.

We will leave it up to other blogs, or possibly future posts of our own, to hypothesize about any possible motives for wanting to start this rumor, but we will close with a quote from one of the KC-30's very own supporters.

When Senator McCain commented on the people who carried out the whisper campaign against him and his family during the 2000 South Carolina presidential primary he said, "I believe that there is a special place in hell for people like those."