Maryland defense industries scratched in budget battle

October 28, 1990|By Ted Shelsby

Maryland's defense industry took some hits in the latest defense budget battle, but appears to have emerged in good shape for future fights.

The $288.3 billion defense authorization bill approved by Congress this week was $19 billion less than the Bush administration requested, and Maryland companies are sharing in the belt-tightening.

Executives at Martin Marietta Corp.'s headquarters in Bethesda probably got the biggest scare when the Senate terminated the company's contract for the development and production of its Air Defense Anti-Tank System, or ADATS.

ADATS is a missile-firing system mounted on a tank-like base that uses advanced electronics to track and engage as many as ten enemy planes simultaneously. The Army is considering buying up to 378 units at a cost of more than $6 billion.

But ADATS has been hit with a series of technical problems that have spurred congressional concern about its reliability, and the lawmakers axed the administration's $233 million budget request to purchase 220 of the fighting machines.

Under terms of the House and Senate Armed Service committees conference bill approved by the House on Wednesday and the Senate on Friday, ADATS spending was limited to $92 million in research and development funds for a restructured ADATS program. A production decision will be delayed until a plan is designed to correct the problems that were detected during tests.

While Martin officials say that the ADATS has done a good job of destroying attacking fighter planes and helicopters during tests, it has been plagued with malfunctions in its power system, radar and target-tracking system.

To help get ADATS back on the right track, the company said that it is taking $11 million from its earnings this year to fund improvements.

"We don't want to use the word concerned," said Martin spokesman Phillip S. Giaramita at the end of the week. "Let's say that ADATS is getting a lot of attention. From a company standpoint, we know what needs to be done and we have a high level of confidence that we can do what needs to be done."

ADATS are built at Martin's Electronics and Missile group in Orlando, Fla.

Despite the threat to ADATS, Mr. Giaramita said the nation's seventh largest defense contractor is emerging from the current budget process in pretty good shape with most of its major program still intact.

But for Martin's Aero & Naval Systems complex at Middle River, the Navy's Sea Lance missile is like the big fish that got away. The Baltimore County complex was hoping to be the second source supplier of the anti-submarine weapon, which is a cross between a missile and a torpedo.

While the program has been threated with termination, the defense authorization bill approved by Congress includes $70 million for continued development work. But that offers little joy to Martin's workers because there are indications that the Navy is no longer anxious to have a second company share a production contract with prime contractor Boeing. Co.

"It's gone as far as we are concerned," said Buzz Bartlett, a spokesman for Martin's Middle River complex. But he said Sea Lance does not represent a major loss to the company, "because we never had it."

Sea Lance is designed to be launched from a surface ship or a submerged submarine. The missile carries the torpedo to the vicinity of the target. The torpedo portion then drops by parachute and completes the shot at an enemy submarine.

While the Navy has not said how many missiles it might buy, it has said that full production would cost more than $4 billion.

On a more bullish note, Martin's Glen Burnie plant is still in the running for a major contract to build the Navy's next generation of airborne low-frequency sonars, or ALFS.

In simple terms, ALFS is an electronic listening device that is lowered into the ocean from a helicopter to detect and track enemy submarines. The Navy said last week that it expects to award a contract early next year.

The Navy may be buying between 400 and 450 ALFS systems, and the winning contractor could pick up an additional 300 orders from foreign customers.

Another multi-billion program involving a local defense plant that has been in jeopardy in recent months is the Mark XV military aircraft identification system being developed by the Towson-based Bendix Communications division of Allied Signal Systems.

The so-called "friend or foe" electronic system uses a transmitter to send out a signal to an aircraft's transponder. If the aircraft is friendly, it automatically sends back information that would easily identify it.

While the Pentagon had terminated the $4.5 billion Mark XV program in December, funding has been put back into the budget. Bendix officials are confident that the program will eventually move into the production stage.

Bendix has said that it would add another 750 workers (doubling its current work force at Towson) when the program moves into the manufacturing phase sometime in the mid-1990s.

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