(Corrects headline, first, third and fourth paragraphs to show Airbus has not yet won a contract with the German armed forces, but is instead teaming up with Israel Aerospace Industries to seek a deal to supply Germany with drones from Israel)
BERLIN May 21 (Reuters) - Airbus (AIR.PA) signed a deal on Wednesday with Israel Aerospace Industries to team up on a bid for a bridging contract to supply the German armed forces with military drones until 2020.
The armed forces currently use an IAI Heron 1 unmanned aerial system, which is made by the Israeli firm and operated by Airbus Defence & Space. However, Germany's contract with the two companies is due to expire in 2015.
Airbus Defence & Space said on Wednesday it had struck a deal with Israel Aerospace Industries to make an offer to supply Germany with an upgraded drone, the Heron TP, after 2015 to allow the country to keep its surveillance capabilities until the arrival of a European drone.
The German government would have the choice of either a purchase option or a lease for the system, Airbus said.
European aerospace companies on Monday put forward proposals for a medium-altitude long endurance (MALE) drone programme that would have to be agreed by governments in the region, before potential production for 2020.
Currently Europe relies on Israeli or U.S. companies for its drone needs, but ministers have said they want to see a European product brought onto the market. (Reporting by Victoria Bryan; Editing by Pravin Char)