MILAN – The CEO of Italy's Leonardo has denied reports that the firm's M-346 jet is too pricey to compete in the U.S. T-X trainer contest, pointing fingers at another supplier for driving up the cost.

Leonardo's partnership with Raytheon to pitch the Italian trainer in the T-X context broke up last month amid reports that Leonardo refused requests from the US firm to lower the aircraft's price. Leonardo has since replaced Raytheon with its US electronics subsidiary DRS as prime contractor on the bid.

Asked about the split with Raytheon at a press conference in Milan on Wednesday, Leonardo CEO Mauro Moretti said, "The problem with Raytheon was not (our) price, because Raytheon checked it against a U.S. benchmark and our prices were lower."

Moretti suggested Raytheon did have a problem with conditions set down by Honeywell, which provides propulsion for the jet, which was renamed the T-100 for the bid.

"Raytheon could not get what they wanted with Honeywell on the engines," he said.

The DRS-led T-X team will be supported by CAE USA in the design and development of the T-100 ground-based training system (GBTS) and Honeywell will continue to provide twin F124 turbofan propulsion engines.

Moretti was bullish about the aircraft’s prospects, despite losing Raytheon as partner, claiming "There is no other competitor."

The T-50 trainer proposed by Lockheed Martin was "not competitive," he said, while the clean-sheet design pitched by Boeing and Saab would not be ready until 2024, by which time the USAF’s current generation of trainers "will be falling apart," he said.

"The only mature system with maximum performace is ours," he said, adding, "We are not going to lose this because we are lacking Raytheon."

Moretti said that it was time Italy sold a defense product in the U.S., given Italy’s long history of buying U.S. products, from the AV8 jump jet up to the F-35. "We can not only buy U.S. products and not be able to sell a single product," he said.

The Air Force is expected to buy 350 T-X aircraft and plans to down-select to a single vendor this year.

Speaking on Wednesday, Moretti also attacked the Canadian government’s decision to buy 16 C295W aircraft from Airbus for search and rescue missions, calling it "astonishing."

Leonardo has challenged the award in Canadian federal court, arguing its losing contender, the C-27J, cost less and was better suited to the mission.

Moretti claimed Airbus had unjustifiably been deemed the winner thanks to "added services that were not part of the bid."