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Northrop Grumman and its European partner EADS, the winners of a U.S. Air Force tanker contract early this month, will invest $600 million in an Alabama plant where the planes will be assembled, according to Tom Enders, chief executive of Airbus. It is anticipated that the $600 million will be invested jointly by the partners.

This follows on the heels of the U.S. Air Force announcement a week ago that it had picked the team led by Northrop Grumman and the European Aeronautic Defence and Space Co. (EADS) for the $35 billion aerial refueling tanker contract, as discussed in our lead article.

Enders confirmed that EADS would create 1300 jobs in Alabama directly as a result of the contract and that Northrop would deliver the first KC-45A to the Air Force in 2011. France-based Airbus will now assemble commercial 330s in Alabama. Separately, Northrop Grumman will convert the planes into tankers using sensitive military technology that is not to be shared.

The Northrop-Airbus contract is expected to also provide a modest economic boost to California, where 40 companies employing approximately 7500 people will manufacture components for the plane. Those firms include safety wire maker Gerard Daniel Worldwide in Fontana and Parker Aerospace in Irvine, which makes refueling equipment. Northrop estimates that the contract may generate approximately $360 million in economic activity, annually.