Changes to the international defence industry mean the Ministry of Defence will have to alter the way it deals with suppliers, MPs have warned.

The shrinking number of defence firms means the government will soon be unable to rely on open competition to get value for money, the Commons defence committee has concluded.

In a report released on Wednesday, MPs called on the government to demand other countries open their markets to British defence firms before allowing them to bid for UK defence contracts.

"The UK must maintain pressure on its European and US partners to conclude already existing international agreements aimed at opening up defence markets," they said.

The committee also took the unusual step of writing to the US Congress over its delay to allow a waiver for Britain in the US international traffic in arms regulations.

They warned the delay could cause a row at a time when political sensitivities are high.

"It is a touchstone for our relations with our closest ally, and the delay risks conveying a message about the nature of the UK-US relationship," MPs said.

The 11-strong committee was critical of two major contracts with BAE systems - Astute and Nimrod - where the firm had agreed to fixed-price contracts.

The firm was unable to meet prices and delivery deadlines "either in error or by being blinded by the must-win nature of those competitions".

"Insisting on the firm delivering as promised would have been a hollow victory if that had left the projects stalled," they said.

The MoD will have to bail the firm out but was warned it must not exceed the under-priced risk.

"To do so would send a message that commitments made in firm-priced contracts are in reality little more than a basis for further negotiation at the first sign of trouble."

MPs predicted there will be problems caused by the complex deal between BAE Systems and Thales over the "future carrier" programme.

The department was praised for its reforms through the "smart acquisition" programme started five years ago which has helped cut costs and time but said there was still room for improvement.

"There remains a question about the agility of those procedures to provide equipment for the armed forces when they need it," the committee said.