Lockheed backs EADS tanker deal

FRANKFURT (Reuters) - European defence and aerospace group EADS (EAD.PA) won support for its $35 billion (18 billion pounds) deal to supply refuelling tankers to the U.S. Air Force from rival Lockheed Martin (LMT.N), which hopes to sell more of its products abroad.

In an interview with German weekly magazine WirtschaftsWoche, Lockheed Chief Executive Robert Stevens said he welcomed the decision to award the contract to EADS and its U.S. partner Northrop Grumman as a sign that defence markets were beginning to open up to international competition.

"Naturally there is a discussion in the USA about whether the Europeans open their markets to a similar degree. I consider the EADS deal a good sign, but the Americans must be a able to expect reciprocation," he said in comments published on Saturday.

Stevens, who recently met with representatives of the German government for the first time, is aiming to grow the share of revenue generated outside of the United States to a good 20 percent in the coming years from a current 15 percent.

EADS and Northrup Grumman received early in March a contract to supply the U.S. Air Force with 179 midair refuellers, beating out U.S. rival Boeing (BA.N) that was until then the sole supplier of aerial tankers to the Pentagon.

With billions of dollars in business on the line and politicians jockeying for votes in the upcoming U.S. elections, the decision to grant a European firm the deal over a U.S. competitor has become mired in controversy however.

Boeing has appealed the award, and procedural mistakes in the tender process were discovered, opening up the possibility of the contract being reopened to competition once more.

Louis Gallois, CEO of EADS, said in comments to German magazine Der Spiegel published on Saturday that he remained confident his company will end up supplying the planes.

"We still have a contract and we are convinced that our aircraft is the best," Gallois told the magazine.