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Northrop Grumman Sets the Record Straight Concerning the U.S. Air Force KC-45A Misinformation

LOS ANGELES -- March 10, 2008 -- Northrop Grumman Corporation (NYSE:NOC) said today that since the Air Force's selection of the Northrop Grumman KC-45A, numerous erroneous comments continue to be repeated in the media and in Congress. Northrop Grumman wants to set the record straight on the following points:

Northrop Grumman, a Los Angeles-based company with over 120,000 employees, is the KC-45A tanker prime contractor

• A contract between the U.S. Air Force and Northrop Grumman Corporation for the Northrop Grumman KC-45A was signed on Feb. 29, 2008.
• Northrop Grumman KC-45A primary subcontractors include EADS-North America, General Electric, Honeywell, AAR Cargo Systems, Sargent Fletcher, Knight Aerospace Products, Parker and Telephonics.

Jobs

• The Northrop Grumman KC-45A U.S. supplier base includes 230 companies in 49 states.
• The Northrop Grumman KC-45A tanker will support more than 25,000 direct and indirect jobs in the United States -- a conservative estimate based upon the U.S. Department of Commerce aerospace industry jobs projection formula.
• Using more recent data from our suppliers and applying the Labor Department's formula for projecting aerospace jobs at the state and regional level, the KC-45A will employ approximately 48,000 direct and indirect jobs nationwide.
• Assembly and militarization of the Northrop Grumman KC-45A tanker will take place in Mobile, Ala., resulting in the creation of 1,500 jobs in the United States.
• Job creation was not a part of the evaluation criteria, in accordance with federal law.
• The Northrop Grumman KC-45A tanker program does not transfer any jobs from the United States to France or any other foreign country.

Repayable Loans / WTO Dispute Issue

• The U.S. Department of Defense ruled that the disputes involving Boeing and Airbus currently being adjudicated by the World Trade Organization were not relevant to the U.S. Air Force's KC-X Tanker competition.

Acquisition Process

• The KC-45A competition underwent the most rigorous, fair and transparent acquisition process in Defense Department history.
• Throughout the process, both competitors in the KC-45A acquisition hailed the Air Force for conducting a fair and open competition.
• The size of the proposed tanker aircraft was not dictated by the Air Force nor was size an established criteria -- each contractor was free to propose the best solution and platform to meet Air Force warfighter requirements.
• Both contractors had ample opportunity in the protracted acquisition and source selection process to propose the best aerial refueling capability to meet the warfighter's requirements.

Reduced Risk to the Government

• The first Northrop Grumman KC-45A tanker aircraft was built in July 2007 and flown in September 2007.
• The Northrop Grumman KC-45A Aerial Refueling Boom System has completed 73 test flights totaling more than 200 flight hours. The boom completed the first in-flight fuel transfer on Feb. 29, 2008 passing 2,000 pounds of fuel to a Portuguese Air Force F-16 combat aircraft.
• The Northrop Grumman KC-45A is based upon the Royal Australian Air Force KC-30B Multirole Tanker -- which has been built, flown, and is undergoing flight tests. It will be delivered on schedule to the Royal Australian Air Force in early 2009.
• Boeing's proposed KC-767AT tanker and refueling boom were never built, flown or tested.

Industrial Base

• The Northrop Grumman KC-45A tanker program will create a new aerospace manufacturing corridor in the southeastern United States.
• The KC-45A program helps return competitiveness to the U.S. aerospace industry.

Foreign Content

• All modern jetliners are built from a global supplier base, and the two entrants in the KC-45A competition are no exception.
• Boeing's proposed tanker includes parts manufactured in Japan, United Kingdom, Canada and Italy.
• Northrop Grumman tanker includes parts built in the United Kingdom, Germany, Spain and France -- countries exempt under the Buy America Law.
• The Northrop Grumman KC-45A will include approximately 60 percent U.S. content. It is America's tanker.

Foreign Suppliers to U.S. Military Programs

• There are numerous examples of transatlantic cooperation on vital U.S. military programs. Foreign suppliers currently play essential roles in the F-35 Joint Strike Fighter, the VH-71 Presidential Helicopter and the C-27J Joint Cargo Aircraft program.
• No sensitive military technology will be exported to Europe. For the KC-45A program, a commercial A330 jetliner will be assembled by American workers in EADS's facility in Mobile. The aircraft will then undergo military conversion in an adjacent Northrop Grumman facility. All of the KC-45A's critical military technology will be added by an American company, Northrop Grumman, in America, in Mobile, Ala.

Northrop Grumman Corporation is a $32 billion global defense and technology company whose 120,000 employees provide innovative systems, products and solutions in information and services, electronics, aerospace and shipbuilding to government and commercial customers worldwide.

CONTACT: Randy Belote (703) 875-8525 randy.belote@ngc.com Tim Paynter (321) 961-1101 tim.paynter@ngc.com