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Boeing Expects IAF M-MRCA Contract Decision By 2010

2008-05-30 Indian government will decide on its plan to buy 126 new fighter jets for its air force "no sooner" than 2010, Boeing Co.'s defense chief Jim Albaugh said today. Boeing, Lockheed Martin Corp., Saab AB, MIG Corp., Dassault Aviation SA and European Aeronautic, Defence & Space Co., the parent of Airbus SAS, submitted bids to the government on April 28 for the contract. The order may be worth $11 billion, the biggest for combat planes in 15 years in India.

Asia, which contributes about $2 billion a year in defense sales for Chicago-based Boeing, will account for 50 percent of international sales at the defense unit in five to 10 years, the company said. India is spending more to buy military aircraft, helicopters and weapons as neighboring Pakistan buys aircraft from the U.S. and China develops its own fighter planes. International sales accounted for 7 percent of total revenue at the defense unit five years ago, and now accounts for about 13 percent, Albaugh said.

The company is protesting a U.S. Air Force award of a $35 billion aerial-refueling tanker program to Northrop Grumman Corp. and the parent of Airbus SAS, saying that changes made midstream in the contest unfairly favored its European rival. The jury is "still out" on the tanker decision, Albaugh told reporters in Singapore today. "There is going to be plenty of opportunities to sell 767 tankers in the event that the protest we have is sustained and there is a re competition and we're fortunate enough to win that re competition," he said.

Boeing fell 0.02 percent to $82.11 in New York Stock Exchange trading yesterday. The shares have declined 6.1 percent this year.

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