A DEAL which will see British Aerospace workers in Lancashire involved in the world's biggest ever defence project has been unveiled.

BAe has announced it has teamed up with American giant Lockheed Martin to help its bid to win the Joint Strike Fighter contract.

Announcing the tie-up, BAe chairman Sir Dick Evans described it as "one hell of a deal".

JSF is being developed for the US forces and the UK's Royal Navy and eventually more than 3,000 aircraft are expected to be ordered.

BAe will now start work with Lockheed Martin on the £500 million contract to produce two concept demonstration aircraft.

Last November, the American government unexpectedly rejected a consortium bid - one of three - which included British Aerospace and McDonnell Douglas for the Joint Strike Fighter programme. Executives from BAe and Lockheed Martin have been in discussion about the British firm joining the US team bidding for the huge contract against rivals Boeing and McDonnell Douglas.

"JSF is the most significant transatlantic military programme of the 21st century," Sir Dick Evans told a packed press conference at the Paris Air SHow.

Although the share out of work has not been decided, BAe's sites at Samlesbury and Warton in Lancashire are confidently expected to benefit.

It is thought expertise developed at Samlesbury on so-called 'lean' low cost design and manufacturing techniques will contribute to the project.

The JSF programme will see 2,036 aircraft built for the US Air Force, 300 for the Navy, 642 for the Marine Corps and 60 for the Royal Navy. A decision from the US government on the winning design is scheduled for 2001.

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