|Looks like Boeing clearly sold their tanker at below cost in order to get this contract, however, the good news (as I understand it), is that Boeing will be responsible for any cost over-runs.
"After the contract was awarded, Boeing revealed ?that it proposed a ceiling price that is less than its actual projected cost to execute the contract,? according to an Air Force statement from spokesman Lieutenant Colonel Jack Miller"
?We completely understand our contractual requirement to pay above the ceiling and we are prepared to do that,? Barksdale said. ?We are comfortable with how we bid. We had to be competitive.?
So they question is, how long before Boeing go cap in hand the government (like Airbus with the A400M) to help offset the costs?