Lockheed CEO Stevens: F-35 production processes improved during strike

There probably is no one in Lockheed Martin management that would say the strike by the Machinists union that is now in its ninth week has been a good thing, but Lockheed CEO Bob Stevens says the company has made good use of the "down time" in Fort Worth.

Stevens, at a press conference in Bethesda, Md. on Tuesday that the Star-Telegram participated in by telephone, said the company's F-35 management team had been able to use the drastically reduced production rate caused by the strike to improve the processes and make adjustments that should help improve production efficiency going forward.

"It's certainly given us time to bring balance to the line," Stevens said. "We've worked to use this time prudently."

Since the program's earliest days the F-35, as with any new aircraft production program, has been plagued with parts shortages, defective parts and components, rework required and in many cases parts that required re-design. Planes are assembled with missing parts or with parts that have to go back and be replaced.

Suppliers struggling to meet deadlines are forced to cope with re-designed parts or to solve technical and reliability problems at their level. All of these factors, many of which stem from overly optimistic assumptions years ago, have added to the delays and rising costs of the F-35 program.

Lockheed's negotiations with the Machinists union and its hard line stand on changes to pension and health care benefits were not the result of Pentagon mandates, Stevens said, contrary to some suggestions and published commentary.

"The Pentagon did not direct us in any way in our negotiations with the IAM," Stevens said, but reflected a drive to bring down costs across the corporation as it prepares for drastic reductions in defense spending.

- Bob Cox

 

 

Comments

[vance mccutchen]

Management comes out of the ivory tower for two months and thing have suddenly gotten better because of them? More PR boloney by Stevens.

[RFUSA]

This strike also gave me the time to investigate corporate abuses on employees deferred benefit packages.

This strike has good intentions but can it resolve the issues at this level? I believe it needs to be resolved at a higher level. The real issues are that corporate executives are interested in the bottom line, its shareholders and company financial performance. Corporations have for decades been allowed to use accounting rules and laws to manipulate the books that cover pensions, define benefits and 401K’s, and health benefits to improve company financial performance. Corporations state that these deferred benefits are costly but research will show that most company funding problems were self-inflicted. I admire the men and women of IAM 776 putting their faith in the Union leadership in hopes for a better contract. It saddens me that Lockheed Martin, Fort Worth HR department couldn’t come up with a creative contract but I was told not hold them accountable because Bethesda, Maryland are calling the shots. All of us, hourly and salary need to do homework on the soundness of our deferred benefits we agreed to as an employee with an employer. For decade’s employers, corporations have used deferred benefits, pensions and health benefits, for their needs and not the participants of the plan. From where I’m standing I see corporate executive actions as legal plundering and theft of pension and health benefits.
My suggestion for further understanding as to the depth of problem read Retirement Heist by Ellen E. Schultz.
See http://actuary.mediaroom.com/index.php?s=6007 1hr. and 40min.
For general and entertaining idea of the problem see Tower Heist

[Bill Davis]

You lie Bob Stevens--you bring shame and dishonor to the Marine Corps!

[Gary Player]

You sit back and whine about the so called corporate greed.

Take a macro perspective and the impact it has directly on your retirement funds and the company you work for.

If a company does not reduce costs and have a healthy bottom line, the stock loses market value.
When the stock value decreases, companies who have that stock in their pension plans must pay more into the pension plan annually and that is an expense for the company which drags down their earnings which again forces them to make a bigger contribution to the plans. It becomes a vicious cycle as the company will do what it takes to reduce costs in order to shore up their bottom line ---- O' that means reducing costs and legacy costs (pensions & healthcare) are BIG drivers.
A 3% is a nice increase while many other industries are taking a cut.
I would replace all those that strike with someone who really wants a job with good benefits. Ok, so you have to pay some heatlhcare, join the real world. Unions have had is SO GOOD for so long and now must give up some stuff to keep companies afloat.

STOP whinning and get back to work!!!!

[Marcel]

LOL, you strikers are scared because LMT thrived without you? You can scream and shout that LMT lied and lied and lied. But bottom line, you don't own the company so shut your pie hole and get back to work while you still can. Running out of funds for bills and food for your family yet? If you can't take care of the present, what makes you think there's a future? You strikers are so ignorant and gullible. Please please, think about your present and take care of your family and get back to work. The future kids will take care of themselves fine and your union will soon die out.

[Gildersleeve]

Those that think that management is sitting behind the desk are wrong. I am working next to directors and even one VP. We are beating all the records of putting things together and apart. If you union guys/gals think you are indespencable, just look at the people next to you. You are anything but irreplacable. You need to come back to work and thank the god you worship that you even have a job. Lockheed is a great place to work, but this suit will change how we relate to the workes and do not think it is business as useual. We got rid of the chairs and if you do not work, you will go also. You guys screwed up big time and now you will have to live with the results. Your union leaders sold you out.

[justsomeone]

I truly wish LM would make all their new contractors permanent and fire all of the union employees. The mere fact that most of the members brag on their facebook page that LM doesn't even have their attention and can go a year without pay shows they get paid well enough. The avg IAM member makes $29/hr. That's the "avg" which the vets are making 40-50+ an hour. That with LM paying 87% of healthcare premiums is a pretty good living. I know of many IAM members that made over 120k last year with their overtime. For an hourly employee...you don't get any better than that.

[F35 Jetman]

There is only one word that comes in mind that will bring joy to the faces of all the union workers that are laying it on the line for there future....Sequestration.....Good Luck come November. We will see who will be protection your jobs!!!

[Ronnie Thalman]

Lockheed Martin is offering us a contract that will lead up to us (3700 IAM Members) losing our pensions and affordable health care, all in the name of lowering cost. When in fact if they were to give us a fair contract that we proposed, it would cost them less for a three year contract than they spend on the top ten Officers of the company in ONE year. Please help this injustice. Lockheed is a large company and thinks they can do whatever they want to people, because we are only peasants. Please help us show the American people that we are fed up with this kind of tyrant. Here are the top three. Look at how much they make and they want to take away our pensions and health care coverage from our families. Shame on them…

[Ronnie Thalman]

Robert J. Stevens-(Chairman & CEO) *Average yearly compensation $23,330,000.00
Christopher E. Kubasik-(President & COO) *Average yearly compensation $9,457,312.00
Bruce L. Tanner-(Executive Vice President & CFO) *Average yearly compensation $6,517,460.00

[Ronnie Thalman]

oh and Mr. Stevens bought 24+ million in stock at on May 6th at his stock option price and even with the stock drop of 10 plus dollars a share he still made 10plus million dollar profit so I am sure life looks good for him.... well until he has to stand before the lord and answer for what he has done to us. The lonely peasants that work and make the company profitable. he is nothing but a smooth talking con man

[Joann Thalman2000]

hey justsomeone you quoted people making $40-50 an hour, not true top out is grade 1 at 32 hour. stevens- top out at $11,000.00 plus an hour. and he gets a pension and good health care. ya thats fair... your right we need to know our place huh.

[Ironduke]

For sure...no one standing around goofing off, no drinking beer in the parking lot...just work. Something the union sheep don't do unless prodded....

[Ironduke]

HR reps will be out in the shop if the strike is resolved to take names and turn them in of the loser thugs that think they can come back in here and harrass and cause trouble. You may be back if the strike is resolved, but be advised, you will be required to work and not perform the same stupid cr*p you do walking the line or you are out. Great..finally putting some pressure on these stooges to actually do some work. About time.

[Mark]

The real loser thugs at Lockheed are in human resources. They have broken nearly every kind of Federal law over the years and never stop trying to get away with it!

[Mark]

Isn't it interesting that all the barely hidden threats are coming from people like Ironduke in salary? All the Thalmans did for example is state fact. The government really needs to step in hard and investigate our management with a bunch of agencys and impartial people brought from outside. Washington DC for example.

[Mark]

The reason the Pentagon did not is simple. The F-16 is out of production for the USAF. I worked on the last that came down the line in 2005 fixing a QAR. There are plenty of spare parts stockpiled for both the F-16 and F-22. The F-35 is not even in service yet and the Pentagon already had made it clear they wanted production slowed until the problems were sorted out. They did not care that the strike did that as long as it did not go on for a year. The Taliban and Al Queada don't even have an air force. So there was no war pressure on the programs. But it did bring plenty of pressure on Lockheed as its stock started to drop and forgion customers started to get restless.

[Mark]

When I was on strike out front I saw things like a salary employee try to swerve his car into an older lady picketeer who had trouble walking already. The heat was bad and she was doing her duty. She kept her temper and so did everyone else. Some of us glared, including me. But no one lost our temper. Nobody even gave the finger. There was no beer or anything alcholic in the hall or parking lot. We were all carefully briefed not to give any excuse to make ourselves or the union look bad. I regularly got the finger, screamed profanity, and a few threats from a few of management as they went by. But I also got a lot more shamed looks, and more than a few secret thumbs up. If it had been up to me when that salary guy tried to hit the lady he would have been chased down, arrested, and charged with attempted murder. No deal made at all about it. It is still Rick Perrys Texas though...Fort Worth police were outside a few days after watching and salary toned it down. You bet I am proud of IAM 776! The strike was no worse than standing up to the British and Tories in the 1770's. In fact it was in some ways the same thing! Standing up to a bunch of bullys!

[Mark]

We were told at the final contract vote that CEO Stevens complained about being compared to a donkey. Well I am sorry that Mr. Stevens got his feelings hurt. Not! The donkey complained too. It has a good heart and never hurt anybody. It brayed very loudly in complaint about being the model for Mr. Stevens!