Boeing chief lobbies DTI over £13bn tanker deal

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The chairman of Boeing stepped up the company's lobbying efforts to win a £13bn deal to supply the RAF with air-to-air refuelling aircraft with a personal plea yesterday to Patricia Hewitt, the Secretary of State for Trade and Industry.

Phil Condit held a 30-minute meeting with Ms Hewitt at the DTI's headquarters accompanied by Sir Richard Evans, the chairman of BAE Systems, another member of Boeing's Tanker Team consortium.

The top-level delegation from Boeing and BAE to Ms Hewitt highlights the vital importance that job considerations will play in the Government's final decision, expected next month. The president of Boeing's defence division, Jim Albaugh, will lobby Geoff Hoon, the Defence Secretary, in person today on what it believes are the military advantages of its bid. The Tanker Team is competing with a European consortium known as Air Tanker, led by EADS, for the 27-year PFI contract, the largest-ever awarded in the UK.

Speaking before the meeting with Ms Hewitt, the Boeing chairman, said: "We intend to go in and explain why our solution is the best solution and why, if the MoD picks us, then 85 per cent of the work will remain within the UK."

Tanker Team, whose other shareholders are Serco and Spectrum Capital, is proposing to modify a fleet of second-hand BA Boeing 767 jets as refuelling tankers. Air Tanker, whose other members are Rolls-Royce, Thales and Cobham, is planning to offer a mix of new and used Airbus A330s.

Air Tanker claims its bid will safeguard 7,500 jobs, break Boeing's monopoly over air refuelling tankers and create a "centre of excellence" for tankers in the UK. Tanker Team claims that its design is a proven one that has already been selected by three air forces, including the USAF, and offers the RAF greater operability and flexibility at less risk and a lower cost.

Although Tanker Team says its bid will guarantee fewer jobs - 5,000, about half of which will be new - Mr Condit maintained they were real ones: "I think we win on jobs. It is an important element and it is an important one to be understood."

He said he would not meet with BAE's Sir Richard to discuss a transatlantic merger of the two companies.

"BAE Systems is a good partner and we will continue to work on things with them but there is nothing more specific than that," he said.

Mr Condit also said that Boeing was veering towards offering a choice of engines on its planned 767 replacement, the 250-seat 7E7.

The Boeing board is expected to give the go-ahead for the new aircraft at its board meeting next month in time for it to enter service in 2008.