Week in review (1/18 to 1/24)

If there’s one thing you can take for granted in the global aerospace industry, it's that today's competitor might very well be tomorrow's partner.

Last week in Paris, Eurocopter CEO Lutz Bertling said the company is looking for American partners on a proposed European heavy-lift helicopter and its bid for the U.S. Army's Armed Reconnaissance Helicopter. The European helicopter maker, an EADS subsidiary, is in early talks with Boeing and Sikorsky, a United Technologies company, as potential partners for a Future Transport Helicopter. (Story)

Boeing is, of course, EADS' rival in the bid for the U.S. Air Force aerial refueling tanker project. But that clearly doesn't stop its subsidiary, Eurocopter, from possibly working with Boeing on this project.

Aerospace companies that hope to win lucrative contracts will team up with others that offer them the best chance to win. It's something political leaders who get too closely aligned with one company and bad-mouth another need to keep in mind.


- Rep. John Murtha, who could play a key role in the battle over the Air Force refueling tanker contract, will be in Mobile Jan. 29 to tour the proposed Northrop Grumman/EADS assembly site. The Pennsylvania Democrat chairs the House Defense Appropriations Committee and was invited by Reps. Artur Davis and Jo Bonner.

Northrop/EADS was awarded the tanker contract last February, but Boeing's protest was upheld and the Pentagon later opted to cancel the contract and let the new administration decide.

Murtha right now likely has other things on his mind. Federal agents last week raided two small Pennsylvania defense contractors – Kuchera Industries and Kuchera Defense Systems – that were given millions of dollars in federal funding by Murtha. The two operations were raided by the Defense Criminal Investigative Service, the FBI and IRS as part of an ongoing investigation.

Pentagon auditors have been looking at the use of earmarks, special-interest spending items directed to a specific company by members of Congress. An Oct. 30, 2007 story in The Wall Street Journal identified Murtha as the largest earmarker in the House.


- While on the subject of Mobile, the Federal Aviation Administration during the week awarded $1.4 million to the Mobile Regional Airport for upgrades, according to Sen. Richard Shelby. The money will be used to repair storm drainage systems, replace the beacon and tower and other projects.


- The Marine Corps recently selected six pilots to become some of the first instructors for the Marine version of the F-35 Joint Strike Fighter. The Marines will travel to Eglin Air Force Base, Fla., where the training detachment for the F-35B will be located, by the end of this year or beginning of next.

The three variants of the JSF are the Air Force F-35A, Navy F-35C and Marine Corps F-35B. A short takeoff/vertical landing F-35s rolled off the line at the Lockheed Martin plant in Fort Worth, Texas, during the week and will be used to test the avionics systems in the summer of 2009. The aircraft, designated BF-4, will carry Northrop Grumman radar and integrated communications, navigation and identification suite and the BAE Systems electronic warfare system. Five F-35s are already undergoing testing.


- The officer who will become commander of Eglin Air Force Base’s Air Armament Center, Maj. Gen. Charles Davis, said this month that the F-35 Lightning II is on track despite an earlier budget shortfall. At a roundtable discussion in Washington, the departing program chief for the F-35 Lightning II also predicted that Israel, Singapore, Spain and Japan will join eight other international partners in the JSF program. At Eglin Davis is replacing Maj. Gen. David Eidsaune, who will become director of operations at headquarters Air Force Materiel Command at Wright-Patterson Air Force Base in Ohio.


- Eglin Air Force Base wants to use some of a 17-acre beachfront test site as a military resort. The proposed Emerald Breeze Resort could provide a revenue stream. Test Site A-5 is a mostly bare parcel next that has a small storage building with antennae only occasionally used to support test missions. The military pictures a 250-room resort. The Air Force will accept public comments until March 12.


- A classified spy satellite for the U.S. National Reconnaissance Office was launched from Cape Canaveral Air Force Station last week onboard a United Launch Alliance Delta IV powered by three Pratt & Whitney Rocketdyne RS-68 engines and one upper-stage RL10B-2 engine. The National Reconnaissance Office is responsible for operating overhead reconnaissance missions for the Department of Defense and the intelligence community. Pratt & Whitney Rocketdyne has an RS-68 operation at Stennis Space Center in Mississippi.


- The Air Force announced this past week the finalists for headquarters of 24th Air Force, a new numbered Air Force focused on the cyber mission – protecting the nation from attacks on computers and other communications systems. The bases are Barksdale Air Force Base, La.; Lackland, Texas; Langley, Va.; Offutt, Neb.; Peterson, Colo.; and Scott, Ill. A final selection will be made in June. Original plans called for a Cyberspace Command, but last fall the Air Force opted to make it a numbered Air Force. Keesler Air Force Base, in Biloxi, Miss., was among the candidates for the command.


- Three companies with operations in the Gulf Coast Aerospace Corridor released earnings reports during the week, and one released information that sets the stage for its report early next month. Northrop Grumman said it will record a fourth quarter loss of $3 billion to $3.4 billion, due to a drop in the book value of its shipbuilding and space technology activities. The company determined that the book value of the former Litton Shipbuilding and TRW, both purchased at the start of the decade, exceeded the fair value. Teledyne Technologies profits rose 24 percent for 2008 to $122.2 million, with fourth quarter profit up 16 percent to $30.8 million. The company's Mobile subsidiary, Teledyne Continental Motors, lost $2.8 million in the fourth quarter compared to a $3 million profit in the same three months of 2007. Lockheed Martin reported fourth quarter 2008 net earnings of $823 million - $2.05 per diluted share - compared to $799 million in 2007. Net sales were $11.1 billion, compared to fourth quarter 2007 sales of $10.8 billion. Cash from operations for the fourth quarter of 2008 was $997 million, compared to $425 million in 2007. Growth in the aerospace activities of Sikorsky and Pratt & Whitney boosted United Technologies’ fourth quarter 2008 income by 8 percent to $1.15 billion. That compares with $1.1 billion a year earlier. Earnings per share were up 14 percent to $1.23.


- There were at least four contracts awarded during the week with ties to the Gulf Coast Aerospace Corridor. Northrop Grumman won a $40 million modification to a previously awarded contract for procurement of three low rate initial production Fire Scout vertical takeoff and landing tactical unmanned aerial vehicle units and associated items. The final assembly work will be done at the Northrop Unmanned Systems Center in Moss Point, Miss. Bell-Boeing Joint Project Office, Amarillo, Texas, was awarded a contract with an estimated value of $581.4 million to provide Joint Performance Based Logistics support for the Marine Corps, Air Force, and Special Forces aircraft during the production and deployment phase of the V-22 Program. Some 6 percent of the work will be performed in Fort Walton Beach, Fla. EADS North American Defense, Arlington, Va., was awarded a $25.6 million contract for funding of the Army's Light Utility Helicopter contract for five UH-72A and supporting mission kits and equipment packages. Work will be performed at Columbus, Miss. EADS North America also has operations in Mobile, Ala. AeroVironment Inc., Simi Valley, Calif., was awarded a $17 million contract to procure a digital data link upgrade for the Raven RQ-11B Unmanned Aircraft System and FY 09 engineering services and accounting for contract services. Work will be performed at Simi Valley, Calif. AeroVironment has an operation at Navarre, Fla.