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Aviation History
1997
1997 - 0023.PDF
NEWS ANALYSIS has set up a review panel and asked the military services for their input. The Pentagon policy of endorsing industry consolidation over recent years makes it unlikely that the merger will face heavy opposition, but the DoD has made it clear that it will require parts of the merged business to be sold off if it identifies a conflict. Questions may be asked about Boeing's continuing role on the F-22, particularly as it plans to operate its military business from the former MDC' headquarters in St Louis, home of the F-18. Already Lockheed Martin insiders are concerned as to where the merged company's long-term loy alties will lie. As the other JSF demonstration contractor, Lockheed Martin has immediate reason to be concerned by Boeing's acquisition of MDC. As Paul Nisbet, aerospace analyst for JSA Research comments: "Boeing very much needs the com bat-aircraft expertise of MDC for JSF...if you want to win JSF, you need MDC, Northrop Grumman and British Aerospace." Boeing's Condit seems to agree: "The carri er-suitability experience that xVlcDonnell Douglas brings is a great strength," he says. While the involvement, if any, of MDC's former JSF partners on Boeing's programme has yet to be decided, Condit has already said that BAe has been approached "...as a potential JSF partner". For BAe, which had tied its JSF hopes to MDC's bid, the Boeing take over offers a face-saving way back into the UK-supported pro gramme, although Lockheed Martin is also working hard to woo the UK company to join itsJSF bid. Meanwhile, Northrop Grumman, MDC's partner on the F-18 as well as its JSF bid, may find itself being courted assiduously by Lockheed Martin. The merger brings critical mass to the combined company's mili tary-helicopter business, which will consist of the AH-64, RAH- 66, CH-47 and V-22. Of the major US programmes, onlv the Bell AH-1 Wand Sikorsky H-60 series lie outside the merged company. Given Boeing's huge investment in the V-22's tilt-rotor technology, the company is unlikely to want to leave a rotary-wing business that is at last large enough to make sense. The merger may be more prob lematical for MDC's commercial- helicopter business, which will be a small part of Boeing's overall activ ity. MDC is struggling to make money building the MD 500, 600 and Explorer civil helicopters and Boeing brings little to die commer cial table, except its half share in the Bell Boeing 609 civil tilt-rotor — and a fervent belief in the commer cial potential of the concept. Boeing's already close ties with Bell may give it the opportunity to bring about a further rationalisa tion of the helicopter business. In the fragmented missiles mar ket, the merger gives Boeing sur prising strength. The combined company will be involved in almost all of the USA's major air-to-sur face missile programmes. MDC builds the anti-ship Harpoon, is developing the land-attack SLAM ER and JDAM guided bomb and is competing against Lockheed Martin to produce the JASSM stand-off missile. Rockwell brings the AGM-130 stand-off weapon and a stake in the Hellfire joint- venture with Lockheed Martin. Boeing itself continues to support the Air-Launched Cruise Missile. The only major US air-to-surface missile programme outside the enlarged Boeing is the JSOW stand-off weapon - and its builder, Texas Instruments, is up for sale. In space, the merger gives Boeing the mass to meet Lockheed Martin head-on. Boeing is already prime contractor on the Space Station and, through its Rockwell acquisition, a partner with Lockheed Martin in the US Space Alliance, which operates the Space Shuttle. MDC has the successful Delta launcher series and was recently selected over Boeing to compete against Lockheed Martin Stonecipher becomes Boeing president MDC expertise will lift Boeings JSF hopes "We intend to continue the lilies of products that we have going at Douglas." to develop the US Air Force's Evolved Expendable Launch Vehicle (EELV). Boeing also has its Sea Launch commercial venture using the Russian Zenit booster, while its Rockwell acquisition brought with it rocket-motor man ufacturer Rocketdyne. The EELV competition could prove to be the last major US mili tary procurement in which com panies other than Boeing and Lockheed iVlartin can compete and hope to win. Only Alliant Techsystems stood in the way of the two behemoths and it is doubt ful that the company, had it been selected, would have been able to muster the resources to win the EELV programme against compe tition from either of the "BigTwo". Much attention has focused on the impact of the Boeing-MDC merger on the commercial-aircraft market, and particularly its effect on Airbus Industrie. The immedi ate effect is likely to be minimal, as MDC was already regarded as a "spent force", particularly after its decision not to proceed with devel opment of the MD-XX stretch of theMD-11. Boeing's acquisition of MDC, however, does eliminate the possibility of Airbus eventually collaborating with Douglas • FLIGHT INTERNATIONAL 1 - 7 January 1997 21
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