Machinists Slam Tanker Accounting Error

Washington, D.C., June 13, 2008 – The International Association of Machinists and Aerospace Workers (IAM) today called for the reversal of the controversial tanker refueling contract following news that the U.S. Air Force awarded the $35 billion contract based on errors that favored the Airbus tanker over a version of Boeing’s 767.

“This process has been deeply flawed from the beginning,” said IAM General Vice President Rich Michalski. “First, the Air Force admitted they never took into account the employment consequences of awarding a multi-billion contract to a company based in France. Now we learn they used grossly inaccurate numbers to compare operating costs of the two aircraft. It’s clear that Boeing won this competition and they should be awarded the right to build these planes.”

The Air Force this week admitted it miscalculated the life-cycle costs of operating Boeing’s refueling tanker by at least $36 million per aircraft and that it awarded the contract to the more expensive proposal for an Airbus tanker. The recent increase in fuel prices makes the cost difference between operating the two aircraft even larger.

Additionally, the Air Force said earlier this year that it was not required to consider the employment impact of outsourcing such a large defense contract.

“We need to decide as a nation if billions in taxpayer dollars should be used to support job creation programs overseas while this country slips deeper into recession,” said Michalski.

The IAM has led a sustained grassroots effort to overturn the tanker award, with members in all 50 states contacting lawmakers and urging an investigation of the process that resulted in the Airbus design being chosen over one based on Boeing’s 767, a model with more than 10 million hours of commercial flying time.

The International Association of Machinists and Aerospace Workers represents nearly 720,000 members including 35,000 Boeing employees at locations across the country.