The US Army has begun construction on the first fuselage for its next-generation AH-64 block III Apache helicopter.

US Army lieutenant colonel Dan Bailey said the first block III aircraft would be unveiled later this year before being fielded by the end of 2012.

The first two Apache block III aircraft will be used for developmental purposes, and the next five to train the first equipped unit.

The new helicopter features a 701D engine, improved avionics, better computer networking capability, increased manoeuvrability and an improved drive system, known as IDS-21 – face gear transmission.

The army is planning to acquire 690 block III Apaches by 2026, of which 643 will be remanufactured aircraft and 56 will be newly built.