Sky Talk

Lockheed & Bell announce jet fighter/marketing leadership

A pair of longtime Lockheed Martin employees have been named to head up one of the company’s leading jet fighter programs, the company announced Monday.

Nineteen-year Lockheed veteran Roderick “Rod” McLean was named vice president and general manager of the F-16/F-22 Integrated Fighter Group (IFG). Michael Cawood was named vice president and deputy for IFG.

Both appointments are effective immediately, officials said.

Orlando Carvalho, executive vice president of Lockheed Martin Aeronautics, said that McLean is ready for his new responsibility.

“Rod’s most recent special assignment as vice president and program manager for the next-generation trainer (T-X) program, combined with his past experience as vice president and deputy for IFG, perfectly prepares him to lead the IFG team into the future,” Carvalho said in a prepared statement.

McLean previously served as F-16 deputy vice president and F-16 program director for various countries in the Middle East, North Africa, and Southeast Asia.

Cawood most recently served as vice president of F-16/F-22 IFG Product Development.

In other industry news, Bell Helicopter said that Anthony Moreland is returning to lead sales and marketing activities as managing director, North America. Moreland most recently led North America and global accounts for Sikorsky Aircraft.

Yamil Berard

Iraq to get another 18 Fort Worth-built F-16 fighters

Lockheed Martin Aeronautics in Fort Worth will keep building F-16s a bit longer, thanks to an $830 million contract to supply 18 of the jet fighters to Iraq. According to the announcement this week from the Air Force, the contract is expected to run through April 30, 2014. It is the second group of F-16s for Iraq, which also acquired 18 of the jets in December 2011. At that time the Pentagon had said it planned another batch for Iraq.

It's the latest in a continuing string of orders for the fiesty aircraft, which saw its 4,500th delivery last year. Just days after the 2011 order for Iraq, Oman ordered a dozen F-16s. And in October 2012, Taiwan placed an order worth up to $1.85 billion to upgrade its aging fleet of 145 F-16s. Lockheed had said prior to the latest Iraq order that its backlog for F-16 orders was enough to keep the program busy into 2015.

-- Jim Fuquay

North Texas defense contractors waiting for impact of federal spending cuts

The budget axe is set to drop in a matter of weeks, but the area's largest defense contractors are still in the dark about the specific impact of automatic spending cuts caused by the budget impasse in Washington.

Lockheed Martin and Bell Helicopter are awaiting guidance from the Pentagon to determine the actual impact of the so-called sequester on their Tarrant County operations. The forced spending cuts, triggered March 1 by congressional inaction, threaten thousands of jobs and programs at the two aerospace giants and other local contractors that are part of the state's $36 billion aerospace industry.

The nature and extent of the Pentagon budget shifts "are as yet undetermined," Bell Helicopter spokesman William Schroeder said Tuesday. "Until we see the final numbers and determine their impact, it's premature to comment."

Lockheed Martin officials say they face a similar holding pattern.

"Until we receive specific guidance from our government customers, we cannot speculate on how significantly sequestration will impact our programs or facilities," Lockheed spokesman Ken Ross said. "We will of course work with our customers and adapt to any significant changes."

But even as they wait for specifics, the companies are starting to slim down their workforces or curtail hiring.

In the past few months, Lockheed Martin has laid off more than 300 workers. It has also offered a voluntary separation program, which provides a lump-sum payment to those with 25 years of seniority.

On Friday, Bell, which has not had significant layoffs in recent years, laid off 15 hourly workers, though all but two of them found other jobs with Bell, Schroeder said.

It's still unclear whether the Pentagon will ask for across-the-board cuts of up to 8 percent to defense contracts, or whether agencies will have some discretion in making the reductions. The Budget Control Act of 2011 imposed $487 million in Defense Department cuts over the next decade.

To halt the sequester, Congress will have to pass, and the president sign, a bill extending routine government funding after a stopgap bill expires March 27. Otherwise, a partial government shutdown is anticipated.

The North Texas workforces at Lockheed and Bell exceed 25,000.

Any layoffs triggered by the sequester at Lockheed Martin will be announced companywide, Ross said.

"As we have previously stated, if warranted, we will provide affected employees the full notice period required by jurisdictional WARN Acts for covered layoff activity at the appropriate time," he said.

The cuts aren't expected to be immediate, and Tarrant's big defense employers could have weeks or months to adjust, analysts say.

The initial impact on Bell Helicopter, officials have said, would likely be small because the company has contracts and funding on V-22 aircraft and military helicopters through 2015.

And the cuts would not apply to funds already obligated to support Lockheed's F-35 program.

In December, Lockheed received a Pentagon contract guaranteeing a final installment of about $127.7 million for the fifth production lot of F-35 fighters. It later received Pentagon contracts worth up to $3.67 billion for 31 additional F-35 jets, according to news reports.

-Yamil Berard

Read more here: http://www.star-telegram.com/2013/03/05/4662895/impact-of-sequester-on-defense.html#storylink=cpy

 

North Texas braces for defense cuts

Tension is mounting among North Texas aerospace workers as huge federal spending cuts due to take effect Friday under "sequestration" appear increasingly inevitable.

With Congressional leaders at an apparent impasse, automatic spending cuts threaten thousands of jobs and programs at Lockheed Martin, Bell Helicopter and other defense contractors that are part of the state's $36 billion aerospace industry.

"The only thing people can do now is hunker down and prepare to fire people, basically," said Richard Aboulafia, an aerospace analyst for the Teal Group in Washington D.C.

North Texas stands to lose big from reductions in programs and workers at some of the world's largest defense contractors, analysts say. The workforce at Lockheed Martin and Bell Helicopter tops 20,000 in Fort Worth alone, while thousands of others are employed by assorted providers of helicopters and aircraft components in Tarrant and neighboring counties.

In Tarrant County, contracts awarded to defense contractors totaled $11.1 billion in 2011, with more than $7 billion tied to Lockheed Martin's F-35 fighter program, according to the Center for Security Policy, a pro-defense group. Some big projects at Lockheed and Bell are already funded, and would escape immediate cuts.

While specific fallout from the budget battle is unknown, Lockheed Martin is already tightening its belt under pressure to contain costs on the over-budget F-35 program.

On Monday, Lockheed notified 68 employees that they will be laid off, spokesman Ken Ross said. The layoff notices went to material handlers, aircraft mechanics and assemblers, a union official confirmed Tuesday.

The layoffs are needed to adjust staffing based on program and business needs and are not related to sequestration, Ross said in response to questions from the Star-Telegram. All told, the company has had 328 layoffs in recent months. Ross has said each round of layoffs has been unrelated to sequestration.

Employees haven't been told if more layoffs are coming, but rumors are flying that more are in store, said Paul Black, president of the International Association of Machinists and Aerospace Workers, District Lodge 776.

"We're sitting here like everybody else to see what happens, but it's not going to be good,'' said Black, whose organization represents 3,600 employees at Lockheed's Fort Worth factory and thousands of service contract workers at Air Force bases in Texas.

"Good or bad, they need to share [information] so everybody knows,'' said Black, who surmises that the recent layoffs were sparked by problems associated with the Joint Strike Fighter.

Click here to read the full story that appeared in Wednesday's Star-Telegram.

-Yamil Berard

Aeronautics experts to convene at Gaylord Texan in Grapevine

GRAPEVINE --Members of the American Institute of Aeronautics and Astronautics are meeting this week at the Gaylord Texan Resorts and Convention Center for the 51st "AIAA" Aerospace Sciences meeting.

Wednesday's 2 to 5:30 p.m. discussion is expected to be a showcase of the "F-35 Joint Strike Fighter Developments and Progress" that includes a complete overview of the program. It will also highlight the aircraft's role in military operations.

The keynote address is expected to be given by Tom Burbage, executive vice president and general manager, F-35 JSF Program Integration, Lockheed Martin Aeronautics Company.

AIAA is the largest organization of aerospace industry professionals with 35,000 individual members and almost 100 corporate members.

You must complete a registration in order to attend the event, which ends Jan. 10. Registration information can be found at www.aiaa.org/ASM2013.

Yamil Berard

"Fiscal cliff" delay leaves defense industry hopeful

The North Texas defense industry is hopeful that Congress' decision to delay action on billions in automatic spending cuts may be a reprieve.

And maybe, that means less than a full sequester, defined by law as $500 billion in cuts, some say.

"We're in a holding pattern for another two months, but the (American Taxpayer Relief Act) agreement was a big step forward and a pretty clear sign that (full) sequestration probably won't happen,'' said Richard Aboulafia, an aerospace industry analyst for The Teal Group in Washington D.C.

Lockheed Martin released a statement Friday also saying that the delay was a positive signal.

“We are encouraged by the actions of Congress and the Administration to delay the implementation of sequestration with the passage of the American Taxpayer Relief Act,'' an official at Lockheed's corporate headquarters wrote in an email.

"We hope this is the first step towards permanent elimination of the automatic across-the-board sequestration cuts that threaten to weaken virtually all government programs and operations, damage our national security, and adversely affect our industry."

Many in the industry want full sequestration to be permanently eliminated.

Speculation is, however, that defense budgets will be reduced in some manner. For example, POLITICO reported last month that sequestration or not, the defense sector is preparing for a bad decade, as the U.S. plans to withdraw from war in Afghanistan.

Since 2006, the defense industry has seen some of the fattest budgets in history.

Yamil Berard

 

Defense spending: 10% cut on Jan. 1?

It appears that sudden doom won’t occur for the defense industry if sequestration take place on New Year’s Day, according to some aerospace analysts and policy researchers.

The sequestration law would inflict 10 percent acrosss-the-board cuts to defense industry contractors and suppliers. But those cuts would not be automatic, policy researchers have said. In the first year, 2013, the trim could be in the range of 4.5 percent, according to the Center for Strategic and Budgetary Assessment in Washington D.C.

So if industry officials receive a letter from the Office of Management and Budget to cut 10 percent, it will take weeks or months before the 10 percent “formula” is implemented. That will give them time to figure out a way to address that, and also give Congress a snapshot of whether it needs to roll back some of these “sequestration” consequences, policy analysts say.

On the other hand, says Richard Aboulafia, an aerospace analyst with The Teal Group in D.C., the 10 percent across-the-board cuts will mean that defense industry budgets will reflect levels prior to 2006 when defense spending took off as a result of wars in Iraq and Afghanistan.

“The worse case scenario is that everything gets hit to the tune of about 10 percent,” Aboulafia told the Star-Telegram, “which is bad but it’s still higher than the numbers the industry saw before 2006. “It wouldn’t be pleasant,’’ he said. “But it wouldn’t be the end of the world.”

Yamil Berard

Lockheed delivers on the F35

2012 was a busy year for the F35.

A total of 30 fighters were delivered to military officials at various locations all over the country, Lockheed Martin officials announced Thursday.

Here's the breakdown:

A total of 15 aircraft were assigned to Eglin Air Force Base, Fla. in support of training operations;

four aircraft were assigned to Marine Corps Air Station, Yuma, Ariz. in support of the Marine Corps' first operational squadron;

six aircraft were assigned to Edwards AFB in support of developmental flight testing and operational test and evaluation;

four aircraft were assigned to Nellis AFB Nev., in support of the development of F35 fighter tactics;

and one CF-5 was ferried to the Naval Air Station, Patuxent River, MD. earlier this month where it will support flight test operations in 2013.

--Yamil Berard

 

 

Lockheed relocating 560 jobs from Georgia to Fort Worth

Hundreds of Lockheed Martin employees in Georgia who worked on the F-22 fighter jet program are having their jobs relocated to Fort Worth.

Lockheed Martin Aeronautics, maker of the F-22, the F-16 and the F-35 jets, expects to move about 560 salaried jobs from its Marietta, Ga., facility to the division's headquarters in Texas.

"Now we are at a stage of supporting the aircraft that are in the field and looking at opportunities to make improvements in the aircraft," Lockheed spokesman Joe Stout said.

Lockheed Martin has been moving to cut costs in the face of expected reductions to the defense budget in Washington. The relocation effort is likely to save $250 million, Stout said.

"We started about two years ago to look at ways that we can do things more efficiently and more affordably," he said. "We felt consolidating our fighter aircraft here in Fort Worth was an opportunity to increase efficiency."

The Pentagon several years ago signaled the end of the $66 billion F-22 program to make way for production of the multi-service F-35 joint strike fighter. In May 2012, the final F-22 Raptor was delivered to the U.S. Air Force.

About 195 of the aircraft were produced, including eight test aircraft, Stout said. Each aircraft cost $147 million, he said. But although the production program has ended, Lockheed isn't about to abandon its business on the supersonic diamond-shaped jet, Stout said.

"Those F-22s are going to be in operation for 20 to 25 years and, during that time, they're going to need a lot of support," Stout said. "There's going to be improvements made in them.

"Electronic technology is going to change," he said. "There might be an opportunity to replace a system or capability on the F-22 with something faster and better."

In the past year, the military investigated an unexplained oxygen supply problem in the aircraft's cockpit after pilots complained of hypoxia. Stout said the issue has been resolved.

Marietta employees affected by the job relocation include engineers, schedulers and persons in administrative positions.

Hourly production employees are not affected, Stout said.

The F-22 Raptor was assembled in Marietta, but one-third of the construction, including the aircraft's center fuselage, was completed in Fort Worth. Lockheed has about 14,200 employees in west Fort Worth.

Marietta employees will be offered a relocation package and must decide by Jan. 7 whether to move. If they choose to stay in Georgia, Lockheed will determine whether they can fill other positions or will be laid off, Stout said.

-Yamil Berard

L-3 Link Simulation gets Iraqi training system contract

From today's Pentagon contract awards:

 L-3 Communications Corp., Arlington, Texas, (FA8621-13-C-6332) is being awarded a $22,600,000 contract for the Iraq Aircrew Training System.  The location of the performance is Arlington, Texas.  Work is expected to be completed by March 31, 2015.  The contracting activity is AFLCMC/WNSK, Wright-Patterson Air Force Base, Ohio.  Contract involves foreign military sales to Iraq.

Iraq, of couse, has ordered or is planning to order a total of 36 F-16s from Lockheed Martin to equip its fledgling air force.

- Bob Cox