The pressure was piled on Eurofighter yesterday as UK Defence Secretary Geoff Hoon announced the long-awaited review of the nation's armed forces.

Companies in the four partner nations are desperate to receive Tranche 2 orders for the aircraft, but Hoon said he would only sign up for the 89 aircraft planned for the UK Royal Air Force once negotiations on price and capabilities had been concluded satisfactorily.

With a whole swathe of pricing agreements needing to be renegotiated if no deal is signed by 31 July and partner companies warning of major redundancies if signing is delayed, the speech made uncomfortable reading for executives from the affected companies at Farnborough. The other three nations - Germany, Spain and Italy - have signed or have been ready to sign for some time.

Hoon also announced:

* The number of re-built Nimrod MRA4 maritime patrol aircraft will be cut from 18 to 12 (assuming price and performance is satisfactory) with the Nimrod MR2 fleet falling from 21 to 16 in the interim;

* Funding for new helicopters will fall from $7.4 billion to $5.4 billion over the next 10 years - confirming Monday's Flight Daily News report revealing a potential threat to AgustaWestland's Future Lynx and Merlin programmes.

* Three squadrons of Jaguar GR3 fighter-bombers and one of Tornado F3 air defence fighters will be disbanded and RAF Coltishall will close;

* Four Boeing C-17 transports currently on lease will be bought in 2008, with one extra C-17 being purchased.

The speech was part of a wider-ranging review that the government insists will result in more flexible, network-centric forces needing fewer platforms to deliver the required "effects and outcomes".

The aim is to move towards more manoeuvrable and readily-deployable forces, it says.

However, the review also states in the clearest terms so far that "the most complex large-scale operations will only be conducted as part of a US-led coalition".

Source: Flight Daily News