Lockheed Rises in Premarket on Jet Contract

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Lockheed Martin

(LMT) - Get Report

was gaining in premarket trading after it beat out

Boeing

(BA) - Get Report

to receive a giant contract from the U.S. government to build fighter jets.

By some estimates, governments worldwide will spend $200 billion on the aircraft, a next generation stealth fighter called the F-35. Lockheed currently builds the F-16, which the new jet will replace starting in about 2008.

Lockheed's current first-phase contract is for 14 production models worth $19 billion.

United Technologies'

Pratt & Whitney unit received a $4 billion pact to build engines that will compete against engines from

General Electric

(GE) - Get Report

and Rolls-Royce to be used in the aircraft.

The contract award to Lockheed led Boeing to cut its projected 2002 revenue by $1 billion.

Lockheed's shares were recently gaining 7.7% to $53.75 in premarket Instinet trading.