The contract, agreed by the Prime Minister during talks in Riyadh with King Fahd will safeguard 19,000 jobs at British Aerospace factories at Warton, Chorley and Samlesbury in Lancashire and Lostock in Greater Manchester. The deal, worth between pounds 3bn and pounds 5bn, is part of the 1985 al- Yamamah programme between Britain and Saudi Arabia. The second stage should have started in the late 1980s but was delayed by Saudi Arabia.
Earlier, in Muscat, Mr Major announced the sale of 36 Vickers Challenger II tanks and four armoured repair and recovery vehicles to Oman, with delivery to start in 1995. The pounds 150m deal, the first export order for the tank, will protect 1,800 jobs at Vickers plants in Newcastle and Leeds. Oman intends to buy 18 more tanks later.
Vickers recently lost a dollars 4.5bn order for 256 tanks and equipment for Kuwait, which chose to buy the Abrams M1A2 made by General Dynamics, of the US.
Oman has traditionally relied heavily on Britain for weapons and training, and has British personnel in its armed forces.
The Saudi agreement is a tremendous lift for British Aerospace, which has been forced to lay off thousands of workers because of the worldwide cut in defence spending. The Tornado production line at Warton, near Preston, ran out of work last month.
The Saudi air force already flies 48 Tornados bought under the pounds 10bn first phase of the Yamamah project, which also involved the sale of warships and defence equipment to Saudi Arabia and which sustains about 33,000 British jobs in Britain and in Saudi Arabia.
The Saudi Tornados are virtually identical to the RAF's GRI fighter bombers that played a key role in the Gulf war.
The two-man swing-wing strike aircraft are designed to carry a wide range of weapons, such as 1,000lb bombs and air-defence missiles. One of the Tornado's greatest strengths is its ability to fly at high speed at heights below 50ft (16m) to avoid radar.
British Aerospace is continuing to negotiate with the Saudis on other elements of the defence programme, including the sale of 60 Hawk aircraft and PC-9 trainer aircraft.
Dick Evans, BAe chief executive, said this latest success in what he called the partnership between government and industry owed much to the personal support of the Prime Minister.
Yesterday's order comes a day after BAe announced it was joining Boeing and three European companies to consider the feasibility of building a new generation of superjumbos, which would go into production around 2000. They would seat up to 800 passengers, twice the capacity of the Boeing 747, the biggest passenger aircraft.
Mr Major was flying back to Britain last night after six-day trip to India and the Gulf aimed at boosting British exports.Reuse content