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McDONNELL DOUGLAS PROGRAMS FARE WELL IN FISCAL 1993 DEFENSE BUDGET

McDONNELL DOUGLAS PROGRAMS FARE WELL IN FISCAL 1993 DEFENSE BUDGET
 ST. LOUIS, Oct. 8 /PRNewswire/ -- Tactical fighter, military trainer aircraft, missile and helicopter programs for which McDonnell Douglas Government Aerospace-East is prime contractor fared well in the $254 billion fiscal year 1993 defense appropriations bill Congress approved Oct. 5.
 Funding totalled $3.8 billion for the F/A-18 Hornet, T-45 Training System, Tomahawk, Standoff Land Attack Missile (SLAM), AV-8B Harrier II, F-15 Eagle, AH-64 Apache and other programs.
 Congress expressed strong support for the F/A-18 program by earmarking approximately $2.2 billion for current and future versions of the strike fighter.
 The bill provides $1.2 billion for production of 36 F/A-18C/D series Hornets for the U.S. Navy and Marine Corps, plus $110 million in long-lead funding for 36 more F/A-18C/Ds for fiscal 1994.
 "The decision by Congress to provide more than $2 billion in funding for the F/A-18 Hornet program illustrates the confidence they have in the aircraft that will be the centerpiece of naval aviation well into the 21st century," said McDonnell Douglas Executive Vice President John Capellupo.
 "This will allow us to produce Hornets at an economical rate for the U.S. government, while stabilizing pricing for our current international customers and enhancing our competitive position in the international marketplace," he said.
 Also included is $944 million to fund development of the upgraded F/A-18E/F Hornet, which will have extended range and payload capabilities plus more-powerful engines and enhanced survivability. "This affirmation of the F/A-18E/F program is of critical importance to us, and secures the jobs of thousands of people," Capellupo said.
 Further strengthening the F/A-18 program is Finland's decision earlier this year to buy 64 Hornets in a $2.8 billion program. Swiss government selection of 34 F/A-18s in a $2.3 billion program awaits a national referendum in 1993. Israel is evaluating the F/A-18 in a competition for 60 aircraft and is scheduled to select a winner in 1993. Kuwait, meanwhile, is taking delivery of 40 Hornets and is interested in buying more F/A-18s.
 The U.S. Navy T-45 Training System, a comprehensive program built around the T-45 Goshawk aircraft, was fully funded with $256 million for production of 12 aircraft plus $26 million in long-lead funding for 18 more aircraft in fiscal 1994. Another $52 million for research and development also was appropriated.
 "The T-45 program is in its early stages, with years of production ahead of it," Capellupo said. "It will make a major contribution to our business base throughout the 1990s."
 Both the F/A-18 and T-45 programs will be mainstays of McDonnell Douglas' (NYSE: MD) U.S. government business.
 "Funding levels on the T-45 and F/A-18 programs demonstrate our strong position in naval aviation now and for the future," Capellupo said.
 Congress provided $404 million for 200 Tomahawk missiles. The dual-source order will be split between MDGA-East and Hughes Missile Systems Co. following a competition to decide which company will produce the majority of the 200-missile acquisition. Production funding for the Standoff Land Attack Missile (SLAM) was set at $90 million for 90 missiles.
 "Missile programs are a very important part of our newly integrated business base, and we think the efficiencies we have achieved on those programs will help put us in a good position to win the majority order for the Tomahawk," Capellupo said.
 The next-generation AX program for the U.S. Navy and U.S. Air Force received $165 million in funding to extend the concept exploration and definition phase and to initiate the demonstration/validation phase.
 McDonnell Douglas is participating on two industry teams vying for the program. On one team, McDonnell Douglas is prime contractor with Vought as principal subcontractor. The other team has General Dynamics as prime contractor with McDonnell Douglas as principal subcontractor and Northrop as a major subcontractor.
 Funding for the U.S. Air Force F-15 Eagle program totalled $54 million for research and development activities. The F-15 production line would, however, be extended at least through 1997 with the $5 billion sale of 72 F-15s to Saudi Arabia.
 "Congress is scheduled to adjourn this week, and we are hopeful Congress will adjourn without taking any action to prevent the sale of 72 F-15s to Saudi Arabia," Capellupo said. "If so, we can anticipate the signing of a formal agreement between the U.S. and Saudi governments in the very near future."
 Congress appropriated $25 million for AV-8B Harrier II technology upgrades to enhance the operational capabilities of the only production vertical/short takeoff and landing (V/STOL) aircraft in the world.
 "This funding, combined with expected international sales of the new Harrier II Plus, helps set the stage for production of this aircraft to continue into the late 1990s," Capellupo said.
 The U.S. Army AH-64 Apache helicopter program received $455 million in funding. Of that, $307 million will go toward research and development for the Longbow technology upgrade project and $148 million to production.
 "All in all, we have had a very good year domestically and internationally while contending with declining military budgets and fierce competition in the international marketplace," Capellupo said. "It's a tribute to the people who design and build the highly capable multi-mission fighters and military trainers we produce."
 -0- 10/8/92
 /CONTACT: Lee Whitney of McDonnell Douglas Government Aerospace, 314-234-0685/
 (MD) CO: McDonnell Douglas Corp.; McDonnell Douglas Government Aerospace ST: Missouri IN: ARO SU:


KJ -- LA028 -- 7959 10/08/92 14:46 EDT
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