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
  • 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

Recruitment Genius: Claims Administrator

£16000 - £18500 per annum: Recruitment Genius: This is an excellent opportunit...

Recruitment Genius: Senior SEO Executive

£24000 - £28000 per annum: Recruitment Genius: A Senior SEO Executive is requi...

Recruitment Genius: Online Customer Service Administrator

£16000 - £18000 per annum: Recruitment Genius: An Online customer Service Admi...

Recruitment Genius: Digital Marketing Executive

£18000 - £22000 per annum: Recruitment Genius: This global, industry leading, ...

Day In a Page

'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

Bread from heaven

Dutch survivors thank RAF for World War II drop that saved millions
Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

How 'the Axe' helped Labour

UK will be 'run for the wealthy and powerful' if Tories retain power
Rare and exclusive video shows the horrific price paid by activists for challenging the rule of jihadist extremists in Syria

The price to be paid for challenging the rule of extremists

A revolution now 'consuming its own children'
Welcome to the world of Megagames

Welcome to the world of Megagames

300 players take part in Watch the Skies! board game in London
'Nymphomaniac' actress reveals what it was really like to star in one of the most explicit films ever

Charlotte Gainsbourg on 'Nymphomaniac'

Starring in one of the most explicit films ever
Robert Fisk in Abu Dhabi: The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers

Robert Fisk in Abu Dhabi

The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers
Vince Cable interview: Charging fees for employment tribunals was 'a very bad move'

Vince Cable exclusive interview

Charging fees for employment tribunals was 'a very bad move'
Iwan Rheon interview: Game of Thrones star returns to his Welsh roots to record debut album

Iwan Rheon is returning to his Welsh roots

Rheon is best known for his role as the Bastard of Bolton. It's gruelling playing a sadistic torturer, he tells Craig McLean, but it hasn't stopped him recording an album of Welsh psychedelia
Russell Brand's interview with Ed Miliband has got everyone talking about The Trews

Everyone is talking about The Trews

Russell Brand's 'true news' videos attract millions of viewers. But today's 'Milibrand' interview introduced his resolutely amateurish style to a whole new crowd
Morne Hardenberg interview: Cameraman for BBC's upcoming show Shark on filming the ocean's most dangerous predator

It's time for my close-up

Meet the man who films great whites for a living
Increasing numbers of homeless people in America keep their mobile phones on the streets

Homeless people keep mobile phones

A homeless person with a smartphone is a common sight in the US. And that's creating a network where the 'hobo' community can share information - and fight stigma - like never before
'Queer saint' Peter Watson left his mark on British culture by bankrolling artworld giants

'Queer saint' who bankrolled artworld giants

British culture owes a huge debt to Peter Watson, says Michael Prodger
Pushkin Prizes: Unusual exchange programme aims to bring countries together through culture

Pushkin Prizes brings countries together

Ten Scottish schoolchildren and their Russian peers attended a creative writing workshop in the Highlands this week
14 best kids' hoodies

14 best kids' hoodies

Don't get caught out by that wind on the beach. Zip them up in a lightweight top to see them through summer to autumn
Robert Fisk in Abu Dhabi: The acceptable face of the Emirates

The acceptable face of the Emirates

Has Abu Dhabi found a way to blend petrodollars with principles, asks Robert Fisk