The U.S. Air Force has awarded Boeing a $35 billion contract to build next-generation aerial refueling tanker aircrafts to replace 179 existing 400 KC-135 models. Boeing will deliver 18 of the new tankers, which are modeled on its 767 commercial aircraft, by 2017.

"We're honored to be given the opportunity to build the Air Force's next tanker and provide a vital capability to the men and women of our armed forces," said Jim McNerney, Boeing chairman, president and CEO. "Our team is ready now to apply our 60 years of tanker experience to develop and build an airplane that will serve the nation for decades to come."

The contract will support 50,000 U.S. jobs both directly and through 800 suppliers across more than 40 states. Boeing will build the tankers at facilities in Washington State and Kansas. The contract will also allow the company to keep production of the 767 open at its assembly plant in Everett, Washington.

"I commend the Air Force for keeping the production of this vital program in the United States," said Kansas Governor Sam Brownback in a news release titled "Congratulations Boeing Workers!" "It ensures the world's newest and most capable tanker will be built by Americans for our American warfighters. I am very pleased the tankers will be built here in Kansas by the highly skilled and motivated Wichita-area work force. This is great news for American jobs and for American security."

Last spring, Boeing said Kansas could see the addition of 7,500 jobs and $388 million in economic impact if it were chosen to build the tankers.

Washington Governor Chris Gregoire said in response to the announcement: "I congratulate Boeing and acknowledge the company's tremendous work that went into this proposal. Boeing has endured a lengthy process, but I'm confident their work will pay off for our state, and our nation. The NewGen tanker will serve our military well, save valuable tax-payer dollars, and put thousands of U.S. men and women to work immediately, creating jobs at a time we need them the most. That's why last spring, I joined several other governors to advocate for Boeing, and encourage our military leaders to move quickly and transparently to make a final decision."

But leaders in Mobile, Alabama, are disappointed by the outcome, as many expected aviation firm EADS to win the contract and bring jobs to the Gulf Coast. EADS has 10 days to object to the Air Force decision.