Pentagon to revisit number of small cargo planes

WASHINGTON May 21 (Reuters) - The U.S. Defense Department will revisit this summer the question of how many of L-3 Communications Holdings Inc's (LLL.N) C-27J cargo planes it needs, Air Force Secretary Michael Donley said on Thursday.

The Pentagon this month said it would halve the $2 billion joint Air Force-Army program, and buy just 38 C-27J planes instead of the 78 initially planned. In addition, the Air Force was told to take control of the joint program from the Army.

Donley told the Senate Armed Services Committee the transition was under way. Air Force Chief of Staff General Norton Schwartz told senators that 38 aircraft was a floor, not a ceiling, for how many the services would ultimately buy.

He said the issue of how many planes to buy would come up again this summer during the Quadrennial Defense Review, a major review of defense programs conducted every four years.

The number of the small cargo planes would also be weighed against the number of larger C-130J cargo planes built by Lockheed Martin Corp (LMT.N), Donley said.

In a May 1-dated letter to Defense Secretary Robert Gates, 13 members of the House of Representatives voiced opposition to the plan to scale back the planned purchases.

Senator Mel Martinez expressed concern about the cutbacks given that L-3 had said it might not be able to build the planes in the United States, given the small order number.

L-3 is teamed with Alenia North America, a unit of Italy's Finmeccanica (SIFI.MI), to build the planes under a contract awarded in 2007.

The planes are designed to meet the tactical needs of ground commanders to carry cargo the "last tactical mile," as well as for homeland security emergency missions, including ferrying hurricane supplies. (Reporting by Andrea Shalal-Esa, editing by Gerald E. McCormick)