US Army, Air Force sign joint cargo plane project

Source URL: http://today.reuters.com/stocks/QuoteCompanyNewsArticle.aspx?view=CN&storyID=2006-06-21T201539Z_01_N21274933_RTRIDST_0_ARMS-USA-CARGOPLANE.XML&rpc=66
Posted at: http://www.air-attack/com/news/news_article/1767

WASHINGTON, June 21 (Reuters) - The Army and Air Force formally agreed on Wednesday to jointly develop a new cargo aircraft to replace aging Vietnam-era cargo planes, a Pentagon program estimated by experts to cost $6 billion in coming years.

The new aircraft will expand the military's ability to ferry cargo and troops to remote locations because they will be able to land on runways of just 2,000 feet. That will alleviate the need for ground convoys subject to attacks.

Vying to build the cargo planes are Lockheed Martin Corp ; a joint venture of Italy's Finmeccanica SpA and L-3 Communications Holdings Inc., and another team led by Raytheon Co. and EADS CASA North America, a unit of EADS, Europe's largest defense contractor.

The agreement signed by Army and Air Force officials on Wednesday set a deadline of July 2007 for an update to an initial 2005 analysis of alternatives, which said the Army would need 75 new aircraft and the Air Force 70.

If the program survives the Senate Armed Services Committee's plan to cut funding for it, the Army plans to select a winner in February 2007 and take delivery of the first planes in fiscal 2010.

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