It could have been the set of "The Bachelor." Surrounded by lights and cameras, a fabulous catch announces he is willing to be wooed by 50 suitors. The best proposal package ...
It could have been the set of “The Bachelor.” Surrounded by lights and cameras, a fabulous catch announces he is willing to be wooed by 50 suitors. The best proposal package — money, connections, looks and compatibility — will win.
But this wasn’t reality TV. It was the news conference where EADS, majority owner of Airbus, announced it will begin a year-long, nationwide search for a U.S. location for a 100-person engineering center.
The bigger prize, however, is the 1,000-employee assembly plant EADS says it will build if it is awarded the $25-billion-plus Air Force tanker contract that Boeing won, then saw slip away again.
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The high-profile media event yesterday was the latest move in EADS’ expanding public-relations campaign in the nation’s capital for Airbus’ attempt to win the tanker deal. All states will be invited to bid, starting Feb. 15, when Airbus hosts an “information day.”
The national hunt will guarantee EADS and its commercial-plane unit, Airbus, a bounty of American publicity. Stalwart Boeing advocate Rep. Norm Dicks called the EADS move “a defining moment” in what he described as a plan “to take Boeing out.”
Ralph Crosby, EADS-North America CEO, said the EADS engineering center would work not only on the tanker but on Airbus’ entire long-range fleet.
The press event was largely about branding EADS as American. Crosby was joined by football legend Roger Staubach, whose commercial real-estate company will handle the search, and an Airbus spokesman reminded reporters that Staubach’s Dallas Cowboys were “America’s team.”
In an interview with The Seattle Times prior to the event, Crosby also repeatedly used the word “American” in describing EADS and its products.
“This will increase our American footprint,” he said. And Crosby stressed if EADS wins the contract, the tanker will be manufactured by an American company.
“Yes, it will — by Boeing,” retorted Dicks afterward.
Dicks said that if EADS does win the contract, it will use commercial Airbus jets made in Europe and then merely modify them for U.S. military use here.
“France will build the planes, and we’ll put the decals on them,” said Mike Spahn, assistant to Sen. Patty Murray.
The announcement came the day after the U.S. Trade Representative and European Union officials agreed to resolve in the next 90 days the dispute between the U.S. and the EU over government subsidies to both commercial plane makers.
The timing was “fortuitous,” Crosby said, acknowledging that EADS planned its news conference to come right after that good news. Just a week earlier, departing Air Force Secretary Jim Roche had warned that any tanker proposal by Airbus would be “tainted” by the subsidy complaint.
“They had to get rid of this,” Dicks said.
Longtime Washington lobbyists and analysts are skeptical that Airbus will succeed with its bid for the tankers, but they believe the company has made inroads in Congress with its PR strategy. According to the Center for Public Integrity, EADS’ lobbying expenses have jumped from $300,000 to about $1 million a year just since 2002.
Keith Ashdown of Taxpayers for Common Sense, a budget watchdog group, called Airbus’ announcement “a brilliant PR ploy. They’re following Defense Politics 101.”
“They have to look like an American company and like they want to create American jobs. The 50-state search makes a patriotic sound bite and they’ll have a year to cozy up to every member of Congress on the relevant committees,” he said.
EADS also has been running ads touting its Texas-based American Eurocopter unit, featuring an executive in a cowboy hat in front of a red, white, and blue helicopter.
The company said it is looking for a site with an existing 9,000-foot runway. EADS would build about 1.5 million square feet of facility space if the tanker contract comes its way.
But several factors could change a winning proffer to a losing one. EADS has been seeking a partnership with one of the larger American aerospace companies for the tanker work. In his interview, Crosby insisted that the eventual partner would not make the final decision on the site. But Lockheed Martin, one potential connection, has huge facilities in Texas and Georgia; Northrup Grumman has plants in California. They might want some input.
And there’s always politics. Airbus needs to “develop a constituency by putting jobs into the U.S.,” said aerospace analyst Phil Finnegan of The Teal Group in Virginia. He noted the company put a helicopter plant in Mississippi when it was the home of the Senate majority leader, Republican Trent Lott.
Loren Thompson, a military expert at The Lexington Institute in Arlington, Va., said, “Relatively few members of Congress will buy into the notion that EADS has become an American company. … However, it’s a safe bet that the congressman who gets the facility in his district will be inclined to think that way.”
Washington State will get a request for information, Crosby said. Juli Wilkerson, director of the Washington’s Department of Community, Trade and Economic Development Community, said state officials “look forward to reviewing the [request] to determine if we meet their qualifications.”
But Robin Pollard, who helped run Washington State’s massive and ultimately successful effort to win Boeing’s 7E7 plant, groaned loudly over the phone when asked about participating in another bidding war for an aerospace plant. “I’m just reliving 2003,” she said. “I’m not sure I’m up for that.”
Whoever partners with Airbus faces its own risks and has to calculate the political cost of teaming up against Boeing. “Boeing has many friends in both chambers of the Congress and they will exact a penalty against any company that wants to be on the other side of the competition,” said Thompson.
Any potential partner, he said, “has to contemplate the call they will get from Norm Dicks. Norm is hard-charging when he likes you — when he doesn’t like you, it’s a fearsome prospect to behold.”
Charging in, Dicks said, “All my friends at Lockheed and Grumman know where I stand. But it’s going to be important for them to know where the other members stand,” he added, listing such powerful politicians as the Speaker of the House, Rep. J. Dennis Hastert of Illinois — home to Boeing’s headquarters.
Dicks believes that the Buy America sentiment since Sept. 11, 2001, rules, and Boeing will ultimately prevail.
But that will be harder now that Boeing has been weakened by scandal over the original tanker deal, and many states are hungry for new jobs.
“This is a great move” for Airbus, said Charles Bofferding of the Society of Professional Engineering Employees in Aerospace, the Boeing engineers union. “It’s all about getting every state’s political people aware that Airbus could give them jobs. It changes their mindset.”
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