Lockheed wins military radio deal

Lockheed Martin Corp. beat out Boeing Co. to win a $766.2-million Pentagon contract to design and build a radio system connecting aircraft, ships and ground stations military-wide.

The deal, announced Friday, could lead to the installation of tens of thousands of radios and ultimately be worth billions to the company.

The award is a key piece of the Joint Tactical Radio System, a major Defense Department program to replace much of the military’s radio equipment with radios that will let Army, Navy, Air Force and Marine troops communicate. The new system will be able to transmit video and other data as well as conversations.

The contract loss is the second blow the Pentagon has dealt to Boeing in less than a month. In late February, Northrop Grumman Corp. and European Aeronautic Defence & Space Co. bested Boeing on a $35-billion Air Force deal to replace 179 air-to-air refueling tankers.

Boeing said it was disappointed by the outcome of the radio system competition. It would not comment on whether it planned to protest the decision.

Boeing already holds the contract for another key piece of the radio program: supplying ground mobile radios, which are used primarily by the Army and Marines.

In other news, Boeing and Textron Inc. received a $10.4-billion contract for the V-22 Osprey that ensures production of 167 more of the aircraft through 2012. The multiyear contract will save as much as $427 million over annual contracts to manufacture the tilt-rotor plane, the Pentagon estimated.

Separately, Boeing said it agreed to buy Vought Aircraft Industries Inc.’s stake in a venture that assembles parts for the new 787 Dreamliner. Terms weren’t disclosed.