Business

U.S. auditors bash Air Force over refueling tanker WASHINGTON (Reuters) - U.S. auditors urged the Air Force Wednesday to rerun its competition for a $35 billion refueling-aircraft order, upholding a protest by losing bidder Boeing Co (BA.N: Quote, Profile, Research) and breathing life into a Pentagon fiasco. The Government Accountability Office found the Air Force made "a number of significant errors that could have affected the outcome of what was a close competition." The contract was awarded on February 29 to a team made up of Northrop Grumman Corp (NOC.N: Quote, Profile, Research) and Europe's EADS (EAD.PA: Quote, Profile, Research), corporate parent of Boeing's passenger-jet maker rival Airbus. GAO, a nonpartisan arm of Congress that reviews federal contract bidding disputes, faulted the Air Force for seven specific reasons, including "misleading and unequal discussions with Boeing." The GAO's ruling is a recommendation to the Air Force, which has 60 days to respond. It was an uncommonly harsh rebuke to the service, which lists the tanker as its top acquisition priority. Sue Payton, the Air Force's top weapons buyer, said the service was reviewing the decision and would spell out its response as soon as possible. "The Air Force will do everything we can to rapidly move forward so America receives this urgently needed capability," she said in a statement. "The Air Force will select the best value tanker for our nation's defense, while being good stewards of the taxpayer dollar."