GAO Turns Down Boeing Protest Over Bomber Contract

By Doug Cameron

Northrop Grumman Corp. can resume work on developing a new Air Force bomber after a federal overseer on Tuesday rejected a protest led by Boeing Co. against the award on a program that could ultimately cost more than $80 billion.

The Government Accountability Office, or GAO, turned down Boeing's protest against the award last October to Northrop following one of the fiercest bidding contests in more than a decade.

Northrop had to stop work on the classified program after Boeing and partner Lockheed Martin Corp. lodged a protest in November, alleging the Air Force selection was "irreparably flawed" because of its treatment of cost and performance estimates submitted by the opposing bidders.

The Air Force and Northrop stood behind the award process.

GAO reviewed the challenges to the selection decision raised by Boeing and has found no basis to sustain or uphold the protest," the agency said in a statement.

"In denying Boeing's protest, GAO concluded that the technical evaluation, and the evaluation of costs, was reasonable, consistent with the terms of the solicitation, and in accordance with procurement laws and regulations."

Northrop said last month that it had included some revenue from work on the long-range strike bomber in its 2016 guidance, and planned to increase hiring on the program, which has been under development for several years.

The company was awarded a $21.4 billion deal to complete the bomber's development alongside a contract to build an initial 21 jets. The Pentagon didn't reveal the size of the production deal, but wants to eventually field 100 of the jets to replace aging aircraft such as the B-52, with the first aircraft due to be fielded from 2025.

The decision moves attention to the two next big Air Force contracts expected to be awarded over the next two years, including a fleet of new training jets and the JSTARS reconnaissance plane.

Write to Doug Cameron at doug.cameron@wsj.com

(END) Dow Jones Newswires

February 16, 2016 12:50 ET (17:50 GMT)

Northrop Grumman (NYSE:NOC)
Graphique Historique de l'Action
De Juin 2024 à Juil 2024