House Panel Calls Hearing on Tanker Deal

WASHINGTON(Reuters) – Top Air Force officials will testify on Wednesday before aHouse Appropriations subcommittee on their decision to award a $35billion contract for a new refueling aircraft to Northrop Grumman Corpand European partner EADS.

A number of U.S. lawmakers, including Speaker of the House ofRepresentatives Nancy Pelosi, a California Democrat, have expressedsurprise at the contract choice, saying the decision to bypass BoeingCo will lead to job losses in the United States.

Northrop says it will assemble its A330 aircraft and modify it formilitary operations in Mobile, Alabama, creating at least 2,500 newjobs and supporting 25,000 around the country.

EADS has promised to assemble all A330 commercial freighters at the new facility it plans to build in Mobile.

Testifying on Wednesday at 10 a.m. EST will be Sue Payton, the topAir Force arms buyer, and Lt. Gen. Donald Hoffman, the top militaryofficial in charge of acquisitions.

Air Force Secretary Michael Wynne and his special assistant foracquisitions, Kenneth Miller, have also been busy answering thequestions of Boeing supporters on Capitol Hill.

Reflecting overall market weakness, Northrop shares were 2.3 percentlower at $80.63 in mid-morning trading on the New York Stock Exchange,while Boeing shares were down 1.5 percent at $79.46.

(Reporting by Andrea Shalal-Esa, editing by Maureen Bavdek)