Alabama Aircraft Loses Legal Appeal

The government denied Alabama Aircraft Industries Inc.'s appeal of a $1.1 billion aircraft maintenance contract. Alabama Aircraft lost its bid to service C-135 aircrafts from the U.S. Air Force last September to former partner Boeing Aerospace and appealed the ruling to the GAO. Following an Air Force debriefing, Alabama Aircraft will consider filing a protest of the new contract award. Alabama Aircraft filed an objection and initially won, with the federal government saying the U.S. Air Force failed to conduct proper cost, price and risk evaluations of Boeing's proposal. After losing the contract to Boeing, Alabama Aircraft lost $4.6 million in the third quarter of 2007 compared to the same period in 2006. The company reported a $1.6 million net loss for the quarter ending Sept. 30. Alabama Aircraft had a $500,000 net loss in the third quarter of 2006. It also announced plans to cut jobs and administrative costs, freeze the pension plan for salaried employees as of Dec. 31, eliminate salary increases for 2008 and restructure the medical and dental benefit plans.