THE VIRGINIAN-PILOT 
              Copyright (c) 1994, Landmark Communications, Inc.

DATE: Thursday, July 7, 1994                 TAG: 9407070536
SECTION: FRONT                    PAGE: A3   EDITION: FINAL 
SOURCE: ASSOCIATED PRESS 
DATELINE: WASHINGTON                         LENGTH: Short :   26 lines

LOCKHEED SAYS IT WILL CUT COST OF F-16 FIGHTERS

Lockheed Corp. offered to drop the price of its F-16 fighter plane Wednesday, underscoring a new, aggressive posture by defense contractors trying to survive amid dwindling Pentagon orders.

The aerospace company announced that its plant in Fort Worth, Texas, could build 12 to 24 F-16 fighters a year starting in 1997 for $20 million per plane.

Six weeks ago, Lockheed rival McDonnell Douglas Corp. proposed building up to 36 Air Force F-15Es for $50 million each.

The question of how much the new Lockheed offer would save is open to debate. While Lockheed says $20 million represents a $3 million savings, the Air Force says the ``fly-away'' price of an F-16 already is $20 million. by CNB