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EADS confident on U.S. tanker offer

SEVILLE, Spain
Thu Jun 26, 2008 5:15am EDT

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SEVILLE, Spain (Reuters) - The head of European aerospace group EADS (EAD.PA) said on Thursday he was committed to sustaining a deal to supply mid-air tankers to the U.S. Air Force after auditors upheld a challenge by rival Boeing (BA.N).

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Washington's General Accounting Office last week upheld a protest by Boeing on 7 counts against the $35 billion deal to supply converted Airbus jetliners as KC-45A refueling tankers, awarded to EADS and its U.S. lead partner Northrop Grumman.

"We are comfortable and confident that the KC-45 is the best solution to the U.S. tanker requirement," Chief Executive Louis Gallois told reporters.

"The GAO has raised issues of process only. It is now up to the Pentagon to address those process issues and move the procurement forward," he said.

"We have won this competition. We are committed to sustaining this win under the leadership of our prime contractor Northrop Grumman (NOC.N)."

Gallois was speaking before an inauguration ceremony for the A400M, a heavy lifter designed to meet shortfalls in airlift capacity among seven European NATO nations.

Development of the aircraft by EADS unit Airbus Military is 6-12 months late with a maiden flight expected in September.

(Reporting by Tim Hepher, Editing by Sudip Kar-Gupta)



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