Aviation plant tries its wings Identity: No longer Martin or Lockheed, and barely GE, Middle River Aircraft Systems embraces its semi-independence.

August 16, 1998|By Greg Schneider | Greg Schneider,SUN STAFF

When workers went to replace a drop ceiling in the entrance of the old Martin airplane plant in Middle River, they made a discovery.

Above the drab acoustical tiles was a vaulted space capped with an ornate, gilded frieze -- a reminder of the 69-year-old plant's former glory as a cradle of aviation history.

The discovery symbolizes what has happened at Middle River in the past eight months.

In November, just as the factory's workers believed they had shed years of decay and secured their future as part of Lockheed Martin Corp., the business was sold to General Electric Co.

Because of the complex nature of the deal, the newly named Middle River Aircraft Systems has wound up virtually a stand-alone company, tied only indirectly to the new corporate masters.

That means Middle River can no longer market itself as the arm of an international giant.

Instead, the company has done the same thing it did with that vaulted ceiling in the lobby: dusted off the past and put it on display.

"The heritage belongs to the workers, the people who are here. The heritage belongs to the community. You can never sell that. You can never transport that out of here," said J. Raymond Roquemore, Middle River's general manager.

The Martin name belongs to Lockheed now at the big aerospace company in Bethesda. But Middle River has everything else, from the gigantic factory buildings that founder Glenn L. Martin began in 1929 to the dramatic painting of a 1930s China Clipper airliner in magazine advertisements.

"It makes sense they would hark back to those days," said Brett Lambert, an industry expert with the DFI International consulting firm in Washington. "People still refer to it as Middle River; whether it's owned by Lockheed or General Electric I think makes very little difference."

The change has meant little to the workers who build thrust reversers and cut sheet metal into intricate parts for Boeing airliners.

"At first, everybody was worrying and wondering: What's GE going to be like? How are they going to treat us? What's it going to mean in a business sense? But pretty much everything has gone the way it has all along, no substantial changes," said Rob Chetelat, chairman of the bargainingcommittee for United Aerospace Workers Local 738, which represents 620 hourly employees in the plant.

Employment at the factory has risen to 1,200, slightly more than it was last year, and executives say they expect to add a few more manufacturing jobs by the end of the year. Middle River does not disclose detailed financial information but has said it expects more than $300 million in sales this year.

Profit is 15 percent higher than in 1997, said William E. Heskett, the plant's vice president for business management.

Steady rise in work

New work is coming in, not in the big gulps some employees expected when they became part of the world's leading manufacturer of jet engines, but at a steady pace.

GE bought a small business last year in Florida that made thrust reversers for the Joint STARS military surveillance plane and transferred the work to Middle River.

Boeing, trapped by an almost unmanageable backlog of orders for jetliners, has been sending the plant an increasing amount of small-parts work.

That appeared to be what Roquemore was referring to when he said there have been benefits to losing the affiliation with Lockheed Martin, which is Boeing's only rival in some areas of defense contracting.

"One of our largest customers, once we became independent out from under Lockheed Martin, our line of business with them increased substantially. We were no longer viewed as the enemy, so to speak," Roquemore said.

Some outsiders are skeptical about just what kind of difference Middle River's new status has made.

Not a peep

"I haven't heard a peep about them lately. They've been extremely silent," said Richard Aboulafia, an aircraft industry expert with the Teal Group consulting firm.

Aboulafia had been a booster of Lockheed Martin's previous efforts to use Middle River to get into the lucrative aircraft maintenance and modification market.

From his perspective, Lockheed Martin wounded itself by unloading the factory, which was part of a package of assets and cash traded to GE to get back a chunk of stock.

The deal was designed to avoid taxes, resulting in Middle River's being an arm's-length subsidiary of GE. Aboulafia said it is an awkward position to occupy.

"The market has said that companies are better off as part of something larger," he said.

Roquemore argues that Middle River has the best of both worlds. An outspoken Georgia farmer who spent a long career at Lockheed, he said he enjoys being free of meddling by GE.

"They do not get in our knickers. They are not here on a daily basis driving us up against a wall," Roquemore said.

At the same time, there is a small line under the new Middle River Aircraft Systems logo that conveys a clear message to prospective customers. It says, "A Subsidiary of GE."

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