Merger or no, Boeing and McDonnell Douglas linked Companies will team up on Joint Strike Fighter even if deal is disallowed

February 04, 1997|By Greg Schneider | Greg Schneider,SUN STAFF

Underscoring its resolve to be a force in military aviation, Boeing Co. said yesterday that it will team with McDonnell Douglas Corp. on the Joint Strike Fighter warplane program even if the pending merger of the two companies falls through.

The Pentagon cut McDonnell Douglas out of the competition for the Joint Strike Fighter in November, leaving Boeing and Bethesda's Lockheed Martin Corp. to duke it out for what could be the biggest military contract ever, at more than $200 billion.

Most analysts say the Pentagon's decision shoved McDonnell Douglas into the arms of Boeing, which announced the following month that it was buying its former competitor for $14 billion.

Boeing officials said at the time that they planned to tap the tremendous military heritage at McDonnell Douglas as they seek to build the first Boeing fighter since World War II. Yesterday's announcement lets them start working together right away instead of waiting several more months for the marriage to become official.

Federal officials have said the merger is likely to clear government regulators.

Lockheed Martin, meanwhile, is courting possible partners of its own -- including Northrop Grumman and British Aerospace, both of which had teamed with McDonnell Douglas on its failed Joint Strike Fighter entry.

The Boeing announcement "was anticipated, and we are having ongoing discussions with potential partners, as well, two of whom are British Aerospace and Northrop Grumman," said Norman Robbins, a spokesman for Lockheed Martin Tactical Aircraft Systems in Fort Worth, Texas.

The race for the Joint Strike Fighter is particularly cutthroat because the plane is the only fighter the Pentagon plans to build in the first part of the next century. It will be used by the Air Force, Navy and Marines as well as the British Royal Navy, with the United Kingdom paying 10 percent of development costs. That country's participation is part of the reason British Aerospace is a coveted project partner. A Boeing spokesman said his company, too, is wooing the conglomerate.

"We have spoken with both teams and as yet have come to no conclusion," said Phil Soucy, a spokesman for British Aerospace. He said to expect a decision in the next few months, and acknowledged that the company could sign on with both competitors.

A spokesman for Boeing said his company will start its new partnership by bringing in about 50 engineers from McDonnell Douglas under an agreement signed Jan. 20. Where they go from there is yet to be determined, said Boeing spokesman Randolph C. Harrison.

Boeing will look to McDonnell Douglas for expertise in such areas as adapting the planes for use on aircraft carriers, vertical takeoff and landing, low-cost manufacturing and rapid prototyping, avionics and cockpit design, Harrison said.

But while many analysts have speculated that such a combination could be just the thing to beat Lockheed Martin when the Pentagon picks a single builder in 2001, at least one remains skeptical.

"The LocMar people have reason to be worried, but what will emerge from the patchwork of companies Boeing is assembling for this job is uncertain. It could be air-Frankenstein's monster," said Richard Aboulafia, a military aircraft analyst for the Teal Group.

Pub Date: 2/04/97

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