Makers of drone reach joint production agreement

July 09, 1991|By Ted Shelsby :

Two of the world's largest manufacturers of one of the military's smallest planes have reached an out-of-court settlement in their legal battle over the right to produce the tiny craft that was a big hit in the recent Persian Gulf conflict.

The dispute between AAI Corp. in Cockeysville and Israel Aircraft Industries (IAI) erupted in March when the Israeli company filed a lawsuit in U.S. District Court in Alexandria, Va., to halt the Baltimore County company's independent production and marketing of the Pioneer drone, called a remote pilotless vehicle. The two companies had been involved in a joint venture for production of the aircraft.

APioneer, which carries a television camera in its belly, was used by U.S. forces during the war against Iraq to detect targets, direct artillery fire and assess battlefield damage.

After the war, AAI moved ahead with plans to bid for a new $12.7 million contract to replace Pioneers damaged or destroyed in the gulf war, and IAI filed its lawsuit charging AAI with breach of contract.

In its legal action, IAI said that a 5-year joint venture between the two companies had ended Sept. 30, 1990, but that the Israeli company had not taken legal action immediately because it did not want to interfere in the U.S. buildup of military power in the Persian Gulf.

Maurice Ranc, director of marketing for AAI,said yesterday that the two sides "agreed to agree" several weeks ago to avoid a long and costly legal battle that neither was certain they could win. There was also some concern about losing out on military contracts if the dispute dragged on.

Under terms of the agreement, Mr. Ranc said, a new joint venture will be established in the Baltimore-Washington area. He said that it would be staffed by two or three people and would negotiate for contracts.

A portion of the craft will be made at AAI's complex in Cockeysville, and other components will be made at IAI's plant in Israel. Final assembly will be done at AAI's facility off York Road, Mr.Ranc said.

He also said that the new arrangement will be similar to the system used in the past, in which AAI served as the prime contractor and IAI was a subcontractor.

The formation of the joint venture, which is expected to be in place by the end of the month, is not expected to have an impact on employment at AAI's Cockeysville plant, where about 80 workers are involved in the production of the Pioneers.

AAI has already produced about 75 Pioneer craft for the U.S. military.

Pioneer is about 14 feet long and has a wingspan of 17 feet. It is powered by a 26-horsepower engine that was originally designed for a snowmobile. The craft carries a black-and-white television camera that can feed back live coverage of enemy troop or equipment movements and battlefield developments.

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