The firm will design and develop the laser system
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A major contract to supply the laser guidance system for the new F 35 joint strike fighter has been won by BAE Systems Avionics in Edinburgh.
The order for several thousand lasers will be completed at the company's Crewe Toll factory in the capital.
Work is expected to begin in 2006 and will provide job security for at least a hundred skilled jobs.
The company was given the contract by US company Lockheed Martin to design and develop the laser system at its sensor systems division (SSD).
The fighter planes are being developed for both the American and UK forces.
SSD managing director Mike Sweeney said: "We are delighted to be awarded such a prestigious contract.
"We have made significant investment in a brand new laser facility at our new
site.
"We are one of the industry leaders in the development of laser technology
and this contract is testimony to the expertise we have in SSD."
Enterprise Minister Jim Wallace said: "This new contract is a resounding endorsement of the management and highly skilled workforce at this facility.
"We can take confidence from this example of Scotland's high tech manufacturer's ability to compete and win an important role in such
international defence programmes."
BAE Systems Avionics employs 2,100 people in Edinburgh.