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http://seattletimes.nwsource.com/text/134498480_farnborough230.html The Seattle Times Tuesday, July 23, 2002 Boeing, Airbus to announce collaboration on missile-defense systems By David Bowermaster Seattle Times aerospace reporter -A U.S.-European joint venture on missile defense could have significant implications. It could signal a willingness on the part of European governments to work with the U.S. government to build an anti-missile capability that protects the United States and other NATO member countries. -"This would be a major key for EADS to unlock the door to U.S. defense budgets," said one source, speaking on condition of anonymity. LONDON — Boeing and the parent company of Airbus today are expected to announce a groundbreaking, transatlantic partnership to collaborate on missile-defense systems. The companies have signed a memorandum of understanding between Boeing's newly formed Integrated Defense Systems unit and the launch-services division of the European Aeronautic, Defense and Space Co. (EADS), according to industry sources. Details will be released at a news conference today at the Farnborough Air Show outside London. Boeing Chairman Phil Condit is expected to make the announcement jointly with EADS' co-chief executives, Phillipe Camus and Rainer Hertich. Financial terms are not known, but the global missile-defense market is expected to be worth tens of billions of dollars over the next decade. Congress authorized $8 billion for missile defense in 2003 alone. Boeing spokeswoman Marta Newhart confirmed Boeing has scheduled a news conference for 3 p.m. London time, but she declined to confirm the participants or disclose the subject matter. She did suggest a major deal is in the works. "What we're going to announce tomorrow is revolutionary in terms of our cooperation with the European aerospace industry." An EADS spokesman did not return calls seeking comment. A U.S.-European joint venture on missile defense could have significant implications. It could signal a willingness on the part of European governments to work with the U.S. government to build an anti-missile capability that protects the United States and other NATO member countries. It also could open the door for EADS to significantly expand its role as a military supplier to the U.S. The cooperation comes even as Airbus and Boeing Commercial Airplanes are trading heated charges of endangering the airline industry by pumping too many airplanes into the market by resorting to cutthroat pricing. The collaborative effort is expected to cover ballistic-missile defense, presumably with EADS launching pieces of the missile-defense system that Boeing is now spearheading as prime contractor on what is formally known as the Ground-Based Midcourse Defense program for the U.S. Department of Defense. Condit yesterday said he thought the need for sophisticated defense systems that the U.S. and its allies can all use would open the door for "a great deal of cooperation across the aerospace industry." Asked if that could include broader Europe participation in the U.S., Condit said, "Absolutely." George Behan, top aide to Rep. Norm Dicks, D-Tacoma, said he expected that the Bush administration would encourage the partnership to build support for missile defense in European countries. And he said it is in Boeing's interest to partner with European countries, which represent some of its biggest customers. "If they partner with EADS on a strategic mission like that, they won't be the evil enemy anymore," Behan said. "There will be less pressure on some of those countries to buy European." But, he added, that doesn't mean there won't be competition. An EADS executive said over the weekend that while U.S. contractors are primarily focused on long-range defenses, EADS is working harder on short- and long-range defenses due to its proximity to Asia, the Middle East and other potential hotspots. Consequently, EADS "is uniquely positioned to cooperate with the U.S. on ballistic-missile defense," Fabrice Bregier said at an EADS media briefing in Ireland. EADS has made it clear in recent months it wants a large share of the U.S. defense market. It took a major step in that direction last month when it was selected as part of a Lockheed Martin led-team to develop a comprehensive air, sea and land communications system for the U.S. Coast Guard known as Deepwater. EADS' portion of the work could be worth up to $1.5 billion. The view within the industry is that a partnership with Boeing would greatly improve EADS' ability to increase its visibility and respect with Pentagon and congressional decision-makers. "This would be a major key for EADS to unlock the door to U.S. defense budgets," said one source, speaking on condition of anonymity. Seattle Times Washington correspondent Katie Pfleger contributed to this report. David Bowermaster can be reached at 206-464-2724 or at [EMAIL PROTECTED] __________________________________________________ Do You Yahoo!? Yahoo! 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