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U.S. Air Force accepts first long-delayed KC-46 tanker jet

Reuters  |  WASHINGTON 

By Mike Stone

WASHINGTON (Reuters) - The has accepted the long-delayed first delivery of the tanker jet made by Boeing, an said on Thursday.

Delivery means could now begin to reverse what has been a steady stream of financial losses related to the program, and a major for the world's largest

The plans to buy 179 of the tankers and could receive as many as four jets at base in as early as this month, the Air Force said.

"This is a major milestone for our next generation tanker and will allow our Airmen to begin operational testing and flight training," Air Force said in a statement, adding that an acceptance ceremony could be held at the base by month end.

The delays and fixes for the program have been costly for Boeing, which recorded $176 million in additional charges on the tanker in the third quarter. This brought the total pre-tax cost of the program to more than $3 billion.

Several problems with the jet are associated with the mechanisms that extend from the tanker to refuel planes mid-air. The responsiveness of the system, and the cameras and monitors that allow operators to see refueling planes, each required "significant engineering work," the statement said.

A joint Air Force-team has resolved the problems, but the Air Force has the right to hold back about $28 million of the cost of each of the first 52 jets on order to ensure delivers fully functional tankers.

Boeing shares were up 1.7 pct at $349.48 in late-morning trading.

(Reporting by Mike and Susan Heavey; Writing by Nick Zieminski; Editing by and James Dalgleish)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, January 10 2019. 22:33 IST