WTO ruling on Airbus won't affect tanker duel

The U.S. will restart the aerial-refueling-tanker competition in a few weeks and the World Trade Organization ruling on Airbus won't affect the bids, Air Force Secretary Michael Donley said Monday.

"We've been stepping through how we approach specific content" in the request for proposals and "how we structure this competition" for the last six months, Donley said. "I do think we are close, within a couple of weeks of releasing" details of the new contest, he said.

Last week's preliminary decision by the WTO will not affect the Air Force's request for proposals because the trade body's ruling is not final, said Donley, speaking at an Air Force convention in suburban Maryland.

"We see no immediate impact, needing to add any language" to the request for proposals, Donley said.

A WTO panel found that European loans to France-based Airbus broke commerce rules, according to people familiar with the confidential ruling. A team led by Northrop Grumman and including Airbus parent European Aeronautic, Defence & Space (EADS) will compete with Boeing for the tanker order.

Defense Secretary Robert Gates canceled the competition last September after Boeing successfully protested the award of a $35 billion tanker order in February 2008 to the Northrop-EADS team.

Boeing is prepared to offer a larger refueling tanker based on the company's 777 model if the Pentagon wanted greater fuel capacity, Rick Lemaster, the company's program manager for tankers, said Monday at a briefing.

In the last round, the Boeing bid was based on its 767 model and Northrop offered the Airbus A330 airplane.