139. Telegram from the Embassy in Italy to the Department of State 1

7330. Dept. pass Commerce and Treasury. Ref: Joint Commerce, Defense, State Message 205742.2 Subject: Sale of P3B Aircraft to Italy.

Deputy Assistant Secretary Defense Henry Kuss and Lockheed officials have had series discussions with representatives Italian industry and Italian Government officials regarding proposed sale P3B “Orion” aircraft to Italy. Chief of Staff Italian Air Force Fanali and Chief of Staff Italian Navy Michelagnoli indicated to Kuss that Italian military had just about concluded that P3B clearly preferable to “Atlantique” from military point of view. They expect decision on this aspect by end of August. They also indicated to Kuss that political rather than military consideration would determine Italian decision as between P3B and “Atlantique.”
Mr. Kuss’ discussions with industry representatives (many of whom are also influential members of Christian Democratic Party) gave him impression that French began to mount campaign in Italy in favor of “Atlantique” immediately after Dutch decision to purchase this aircraft. However, at informal meeting between Kuss and Foreign Minister Medici latter did not indicate he yet aware of French campaign, and showed great interest in draft memorandum Kuss and Lockheed Vice President Wilder had prepared on this subject.3
Embassy informed by reliable source that French Ambassador to Rome has instructions to approach GOI in effort convince GOI to join “Atlantique” consortium and to arrange for his Dutch, Belgian and German colleagues to do the same.
Draft memorandum prepared by Kuss and Wilder (copy left with Medici on informal basis) outlines following proposal:
Expresses joint US-Italian interest in common equipment planning for anti-submarine warfare role;
Expresses most favorable price, credit without reference to specific interest rate, training and logistics considerations for purchase of US aircraft;
Expresses economic political willingness to allow equal competition with US industry toward target procurement goal of 25 percent program value US aircraft purchase. (FYI. Program value estimated at $100 million. End FYI.) Also expresses willingness Lockheed Aircraft Corporation participate in transfer through licensing arrangements of technology on compound helicopter for potential civil or military use in Europe.
Kuss and Wilder prepared to sign this memorandum including 90-day option on basis serious consideration by Italian Government of P3B aircraft. In his informal discussion with Kuss, Medici indicated he might be prepared to accept above memorandum on formal basis. Although Medici did not so indicate, Kuss was informed by industry representatives that Medici will probably coordinate views of Ministries of Defense, Industry and Foreign Affairs on “Atlantique” consortium proposal. Medici said he would let us know by July 27 whether GOI would wish memorandum to be presented formally. Memorandum could be presented either at Ministry Foreign Affairs or Ministry of Defense.
Regardless nature GOI decision regarding formal presentation of memorandum, we believe it most important and urgent that letter from Chief Naval Operations to Italian Chief Naval Staff and Chief of Staff Italian Air Force regarding P3B purchase (delivered morning July 25) be supplemented by letters to Italian Foreign Affairs and Defense Ministers from Secretaries of State and Defense.
Following is suggested text: “The United States and Italian Armed Forces have been flying anti-submarine patrols over the waters surrounding Italy for many years with some of our aircraft based at the same facility in Sicily. To those of us who share the responsibility for defense of the Mediterranean waters your adoption of the P3B aircraft is of considerable importance. We would appreciate every attention you can give to this matter in the interest of our mutual security.”
Request urgent approval of suggested letters in order that they may be delivered early next week since we believe communications at [Page 291] this level are now necessary to offset expected high-level approaches from French and others in favor of “Atlantique.”4
  1. Source: National Archives and Records Administration, RG 59, Central Files 1967-69, DEF 12-5 IT. Confidential; Priority. Also sent to the Department of Defense and repeated to USCINCEUR.
  2. Telegram 205742 to Rome, July 19, reported on efforts to promote sales of Lockheed aircraft to Italy. (Ibid.)
  3. Not found.
  4. In a July 30 memorandum to Secretary Rusk, George Springsteen, Acting Assistant Secretary of State for European Affairs, recommended against adopting the Embassy’s suggestion. He noted that the Department of Defense had also decided against sending a letter from Secretary Clifford. (National Archives and Records Administration, RG 59, Central Files 1967-69, DEF 12-5 IT)