U.S. Aircraft Manufacturer to Sue Israel over Lavi Contracts

Pratt and Whitney, a major American manufacturer of aircraft engines, is about to file suit in New York against the Israeli government for $350 million in compensation for violation of contracts related to the joint development of the Lavi, Israel’s second generation jet fighter plane, the Israeli news media reported Sunday.

The Lavi project was abandoned by decision of Israel’s Cabinet last Aug. 30 because of excessive costs. The Reagan administration had been urging such action for more than a year. The Lavi was financed by U.S. military grants.

Hadashot reported Sunday that the Defense Ministry has offered Pratt and Whitney proposals for future cooperation that would make up the losses sustained from cancellation of the Lavi. The ministry thereby hopes the American company will withdraw its suit, Hadashot said. In a related item, the newspaper reported that the defense establishment has decided to buy F-16C fighter planes from the General Dynamics Corp. as a substitute for the Lavi. According to the report, the F-16s will not be modified with components developed in Israel. Israel Aircraft Industries, manufacturer of the Lavi, will not enter into joint production arrangements with General Dynamics, Hadashot said.

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