$6 Billion Lockheed Deal For Spy Plane in Jeopardy
Thursday, September 15, 2005
The Army ordered Lockheed Martin Corp. to stop work on a $6 billion manned spy plane program yesterday after determining that the company's proposal would not meet the project's requirements.
Bethesda-based Lockheed beat a team led by Northrop Grumman Corp. last year for the contract to develop the unarmed Aerial Common Sensor, which is intended to fly at 37,000 feet to detect enemy signals and track troop movements. But the Army determined that the regional jet from Brazil's Embraer SA that Lockheed planned to use was too small for the job.
Though the Army did not cancel the program yesterday, Lockheed has only 60 days to submit a plan addressing the Army's concerns. A stop-work order is generally considered an indication that a program is at risk of cancellation.
Lockheed officials have said they are considering several options, including using a different plane.
"To meet Army and Navy requirements, an alternate aircraft to the Embraer 145 will be necessary to achieve mission capability," Edward T. Bair, the Army program executive officer for intelligence, electronic warfare and sensors, said in a written statement. "Current contract performance is not supporting critical program milestones and the Lockheed Martin design does not fully support key performance requirements."
Lockheed said it remained committed to the program. "We will be working with our customer to address the current issues and to determine the most achievable and affordable path forward for the program," a written statement said.
The Army and Navy were expected to order 38 and 19 of the planes, respectively. The Aerial Common Sensor is intended to replace two Army planes -- the Guardrail Common Sensor and Airborne Reconnaissance Low -- and the Navy's EP-3E.