Well, I am going to throw it out clear and honest and let the chips fall as they may.
It wasn't really a competition between Boeing and Northrop-Grumman.
Northrop-Grumman was just a wise effort by EADS to put an American face on the contract bid. Nothing wrong with that, but except for the engines and the refueling boom, the rest of that aircraft was pure EADS.
Now, as far as the outcome.
EADS threatened the USAF that unless the original specs were modified to raise the benefits of large cargo throughput (something the USAF did not really want) that EADS would withdraw from the contract bid. The USAF was so desperate to have a competitive bid process that it agreed to EADS's demands (some would say threat). So, the spec's were changed midstream.
This decision wasn't EADS's fault. They just stated their corporate position. Again, nothing wrong with that.
The fault was entirely with the USAF, which should have stuck to its actual desires in the new tanker (voiced originally as "best pure tanker" and allowed EADS to make its ultimate decision to compete or not.
Once the spec's were modified, Boeing came back and asked if the USAF wanted a variant of their 777. The USAF said no, it wanted the spec's for the 757 that Boeing originally submitted to meet the original spec's.
The USAF changed the goal post, failed to honestly tell Boeing what the new goal posts were, and then left Boeing out in the cold when it announced the original decision. Within hours I came here to SOH and predicted that the award would be overturned by the CBO audit and of course I was right. Wasn't any great insight. It was just that the way the USAF handled the contract was so horribly botched that either company could have successfully challenged the award.
So, when the DoD weighed in on the re-do, the USAF decided to again go with their original spec's. EADS again threatened to pull from the bid process. This time the USAF stuck to its original desires and refused to modify the spec's again.
EADS pulled out.
Boeing won the contract by default.
All sorts of nationalistic arguments can be made back and forth. However, what I wrote above is what happened.
Now, going from facts to my opinion, EADS knew their bid did not match up well to the Boeing bid as measured by the original spec's. Therefore, EADS knew the spec's must be modified for them to win. The USAF caved in to the demands, got burned and humiliated, and then when EADS had to compete against the original spec's, concluded with logic that there was no point in them continuing the expense of bidding on the contract. It is a rational choice based upon the millions of dollars required to submit a bid and fly-away demonstrator. If you don't think you can win, it makes perfect sense to fold your cards and save your chips for another hand.
Ken