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Last updated at: (Beijing Time) Saturday, May 24, 2003

US Air Force to Lease 100 Boeing jetliners as Refueling Tankers

The US Department of Defense has approved an Air Force plan to lease 100 modified jetliners from Boeing Co. as refueling aircraft, a deal critics say was reached for the interest of the defense giant.


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The US Department of Defense has approved an Air Force plan to lease 100 modified jetliners from Boeing Co. as refueling aircraft, a deal critics say was reached for the interest of the defense giant.

Pentagon acquisitions chief Edward "Pete" Aldridge said at a news conference Friday that Defense Secretary Donald H. Rumsfeld had made the final decision on the 16-billion-dollar deal.

Under the deal, the Air Force will lease the tankers for about 131 million dollars each. The deal also includes a buyout option for purchase at the end of a six-year lease, pending congressional approval.

While the Pentagon has leased vehicles and other small pieces of equipment before, it has never pursued a military-equipment lease of this magnitude. As a result, negotiations toward the arrangement have dragged on for nearly two years, with key congressmen and Bush administration officials raising concerns about the cost effectiveness of such a proposition.

Republican Senator John McCain said the deal was "a profligate waste" of taxpayer's money. "In all my years in Congress, I have never seen the security and fiduciary responsibilities of the federal government quite so nakedly subordinated to the interests of one defense manufacturer," he was quoted by local media reportsas saying.

But the plan got strong support in Congress because it would bea crucial boost to Chicago-based Boeing's ailing commercial jetliner business, which has seen orders for its 767 jetliners andother commercial aircraft drop precipitously amid a weak economy and travel-security concerns.

Air Force officials stress that increased deployments in Iraq, Afghanistan and elsewhere make new refueling tankers essential to it as well, given that some of its tankers already are 40 years old.


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