Workers at BAe Systems are celebrating after the firm announced a significant expansion of a contract with giant US plane maker Boeing.

The firm's operation in Prestwick is to supply wing components for the company's 767s.

It coincides with the Ayrshire factory's delivery of the first consignment of wing parts for Boeing's 777 aircraft.

About 1200 people employed at Prestwick are already working on a contract to supply wing components for the long-haul 777.

That contract is due to run until 2007, and as those parts were delivered in Washington State, the company announced a new contract to supply similar parts for Boeing's medium haul 767.

BAe's managing director Dave Griffiths said the work was a major milestone which put Prestwick on the road to becoming the centre of excellence for this type of aerospace technology.

Minister's praise

Scotland Office Minister Brian Wilson paid tribute to the staff and said it was proof of "the bright future of aerospace engineering" at Prestwick.

Mr Wilson told workers: "The hand over today is also a challenge to BAe Systems to maintain the high standards they have reached, and a challenge to industry in Scotland to make the investment in skills that will secure its future.

"The global aerospace industry is going through a process of change.

"Global players are emerging that have the weight and reach necessitated by the market.

"Competition and collaboration, as in the case of BAe Systems and Boeing, will I am sure, continue to feature in that market.

"In this landscape, competitive advantage relies on building the knowledge and skills of employees."