Brussels weighs in over EADS's cancelled US bid

EADS is withdrawing from the race for a $35bn Pentagon contract because the terms "clearly favour" US rival Boeing, prompting harsh words from the European Commission.

The European defence giant announced the decision alongside 2009 results revealing €763m (£692m) losses, which it blamed on foreign exchange effects, a €1.8bn charge for the troubled A400M programme and another €240m-worth of provision on the A380.

EADS was bidding for the US Air Force in-flight refuelling tanker programme with US partner Northrop Grumman. Concerns about the KC-X deal were raised with the Department of Defence, but to no avail. "Serious concerns were expressed that the acquisition methodology would heavily weigh the competition in favour of the smaller, less capable Boeing tanker," EADS said yesterday. "Northrop's analysis reaffirmed those concerns and prompted the decision not to bid."

The European Commission was quick to voice extreme concern at the possibility that "the terms of tender were such as to inhibit open competition". The EU trade commissioner, Karel De Gucht, said: "It is highly regrettable that a major potential supplier would feel unable to bid for a contract of this type."

The withdrawal is just one more twist in a long-running saga. The first KC-X deal was won by Boeing in 2003. But it was cancelled because a US Air Force official allegedly unfairly promoted Boeing. The programme was then re-tendered and EADS/Northrop won it in 2008. But that deal was also cancelled, this time after a Boeing appeal.

The latest storm over KC-X helped to deflect attention away from EADS's sharp losses and cancellation of its dividend yesterday. Revenues were broadly flat at €42.8bn and earnings before interest and tax came in at €2.2bn, in line with guidance.

The past week has seen some welcome certainty for the A400M military transporter, after months of brinkmanship that saw the chief executive of EADS's Airbus unit, Tom Enders, threatening to can it. The seven "customer nations" have finally agreed to put in more money to support the delayed programme. Yesterday Airbus also unveiled plans to increase production of single-aisle A320 planes from December.

Suggested Topics
Start your day with The Independent, sign up for daily news emails
ebooks
ebooksA special investigation by Andy McSmith
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Junior Application Support Analyst - Fluent German Speaker

£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

Ashdown Group: Training Coordinator - Financial Services

£32000 - £38000 per annum + benefits: Ashdown Group: A highly successful, inte...

Recruitment Genius: Business Development Executive - Affiliates & Partnerships

£20000 - £35000 per annum: Recruitment Genius: This multi-award winning foreig...

Recruitment Genius: Retirement Coordinator - Financial Services

Negotiable: Recruitment Genius: To provide a prompt, friendly and efficient se...

Day In a Page

No postcode? No vote

Floating voters

How living on a houseboat meant I didn't officially 'exist'
Louis Theroux's affable Englishman routine begins to wear thin

By Reason of Insanity

Louis Theroux's affable Englishman routine begins to wear thin
Power dressing is back – but no shoulderpads!

Power dressing is back

But banish all thoughts of Eighties shoulderpads
Spanish stone-age cave paintings 'under threat' after being re-opened to the public

Spanish stone-age cave paintings in Altamira 'under threat'

Caves were re-opened to the public
'I was the bookies’ favourite to be first to leave the Cabinet'

Vince Cable interview

'I was the bookies’ favourite to be first to leave the Cabinet'
Election 2015: How many of the Government's coalition agreement promises have been kept?

Promises, promises

But how many coalition agreement pledges have been kept?
The Gaza fisherman who built his own reef - and was shot dead there by an Israeli gunboat

The death of a Gaza fisherman

He built his own reef, and was fatally shot there by an Israeli gunboat
Saudi Arabia's airstrikes in Yemen are fuelling the Gulf's fire

Saudi airstrikes are fuelling the Gulf's fire

Arab intervention in Yemen risks entrenching Sunni-Shia divide and handing a victory to Isis, says Patrick Cockburn
Zayn Malik's departure from One Direction shows the perils of fame in the age of social media

The only direction Zayn could go

We wince at the anguish of One Direction's fans, but Malik's departure shows the perils of fame in the age of social media
Young Magician of the Year 2015: Meet the schoolgirl from Newcastle who has her heart set on being the competition's first female winner

Spells like teen spirit

A 16-year-old from Newcastle has set her heart on being the first female to win Young Magician of the Year. Jonathan Owen meets her
Jonathan Anderson: If fashion is a cycle, this young man knows just how to ride it

If fashion is a cycle, this young man knows just how to ride it

British designer Jonathan Anderson is putting his stamp on venerable house Loewe
Number plates scheme could provide a licence to offend in the land of the free

Licence to offend in the land of the free

Cash-strapped states have hit on a way of making money out of drivers that may be in collision with the First Amendment, says Rupert Cornwell
From farm to fork: Meet the Cornish fishermen, vegetable-growers and butchers causing a stir in London's top restaurants

From farm to fork in Cornwall

One man is bringing together Cornwall's most accomplished growers, fishermen and butchers with London's best chefs to put the finest, freshest produce on the plates of some of the country’s best restaurants
Robert Parker interview: The world's top wine critic on tasting 10,000 bottles a year, absurd drinking notes and New World wannabes

Robert Parker interview

The world's top wine critic on tasting 10,000 bottles a year, absurd drinking notes and New World wannabes
Don't believe the stereotype - or should you?

Don't believe the stereotype - or should you?

We exaggerate regional traits and turn them into jokes - and those on the receiving end are in on it too, says DJ Taylor