Boeing to supply E-7 in first major win since plea deal

The United States Air Force said it had reached a deal with Boeing (BA.N), opens new tab for the supply of E-7 Wedgetail airborne warning and control aircraft and downplayed concerns that the company's internal crisis would harm its ability to supply the Pentagon.

The provisional deal covers the rapid production of prototypes as the Air Force phases out E-3 Sentry or AWACS airborne warning and control aircraft, and follows reports of disagreements over the price for the 737-based Wedgetail planes.

"We have reached agreement with (Boeing)... We have got a reasonable price point that we can afford," Secretary of the Air Force Frank Kendall told reporters at the Royal International Air Tattoo military air show in western England.
A formal contract will be finalised in August, he added.

It is the first major contract announcement since Boeing agreed earlier this month to plead guilty to a criminal fraud conspiracy charge to resolve a U.S. Justice Department investigation into 737 MAX fatal crashes over five years ago.

Experts have said the guilty plea, which is opposed by the crash victims' families, potentially threatens the company's ability to secure contracts from agencies such as the Defense Department and NASA, although it could seek waivers.

Asked how the plea deal had affected the Pentagon's ability to negotiate with Boeing, Kendall said, "The short answer is it has not; we are continuing to do business with Boeing".

News.Az