Lockheed Martin for Maryland

March 19, 1995

Completion of the $10 billion merger between Martin Marietta Corp. and Lockheed Corp. makes Maryland the headquarters state for the nation's largest aerospace and defense company, a $23 billion behemoth whose new name, Lockheed Martin, echoes down through the decades of aviation history. Which company came out top dog in this deal is a matter of who you are and where you are.

The corporate staffs for both companies, Martin in Bethesda and Lockheed in Calabasas, Calif., both comprised about 500 employees. They are being consolidated into a 600-person staff at Martin's old headquarters in Bethesda. So it is the Californians, not the Marylanders, who have to move, which means more Marylanders will survive the corporate staff downsizing.

In the executive suite, Lockheed's 63-year-old chairman, Daniel M. Tellep, will serve as chairman and CEO of the conglomerate. At the end of 1995 he is to give up the chief executive post to Martin's 59-year-old chairman Norman R. Augustine and the chairmanship a year later. Most analysts figure the long-range advantage goes to Martin.

Of far greater importance to the 175,000 employees (4,400 in Maryland) of these newly twinned giants is the fate of the individual plants or laboratories for which they work. If the merger is to produce billions of dollars in savings, as the Pentagon has been promised, it is estimated that about 25,000 jobs must be eliminated.

What does that mean for the future of Martin's long-endangered plant in Middle River? The word from Mr. Augustine is that "Maryland. . . has more capacity than we need. Maryland, like everything else, is on an equal footing." Gov. Parris N. Glendening is already continuing his predecessor's efforts to keep the Middle River complex in operation. Typical of the decisions confronting the new company is how and when to pick underutilized plants either for closing or consolidation.

Whatever the result, downsizing of defense contract operations would have been inevitable, regardless of the Lockheed Martin merger. The Republican takeover of Congress may slow the contraction but not prevent it. As a result, Lockheed Martin, which accounts for about 15 percent of all Defense Department equipment and R&D purchasing, has to reconfigure itself for the post-Cold War world.

Maryland is fortunate to be corporate headquarters for this important company. Benefits will undoubtedly accrue to the state over the long run, although some Maryland-based employees seem sadly destined to have their careers disrupted.

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