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Lockheed May Seek GMD Work, Touts $556 Million PAC-3 Army Contracts

By | January 14, 2008

      PAC-3 Contract Part Of $1.7 Billion Lockheed Missile Defense Orders In 2007

      Middle East May Be Ripe Market For Lockheed Missile Defense Systems

      Lockheed Martin Corp. [LMT] has begun jockeying to get a piece of the action in the Ground-based Midcourse Defense (GMD) missile shield program now led by prime contractor The Boeing Co. [BA], a possible contest that also might include Northrop Grumman Corp. [NOC].

      Separately, the Army gave Lockheed a total $556 million in orders for Patriot Advanced Capability-3 (PAC-3) missile interceptors, helping to push the largest defense contractor to a total $1.7 billion in missile-defense-related contracts last year, Lockheed briefers said.

      They also said Lockheed may pick up new business in the Middle East, including Israel, where allied nations now fielding the older PAC-2 systems have expressed interest in upgrading to the PAC-3.

      Those comments came in a teleconference with several defense journalists that was led by David Kier, Lockheed vice president and managing director of missile defense.

      On the GMD issue, Lockheed submitted a response to a request for information (RFI) from the Missile Defense Agency (MDA), in which the missile-shield agency is seeking industry input as to how to proceed with the future follow-on GMD program.

      Boeing and Northrop earlier announced they responded to the RFI.

      Kier noted that "several of our competitors" are interested in the GMD follow-on. It would be a lesser contract than the original contract to develop the system and build the interceptor and radar sites.

      In response to a question, Kier said he isn’t sure how the Lockheed response to the GMD RFI differs from the Boeing response, since he hasn’t seen what Boeing submitted. As to what Lockheed might offer that Boeing doesn’t already provide, Kier said that Lockheed "will respond as appropriate to whatever MDA needs."

      MDA is considering how to proceed with this next leg of the program, and Kier said he expects that "in the next couple of weeks we’ll find out where they want to go" with it.

      The current Boeing GMD team includes Orbital Sciences Corp. [ORB], Raytheon Co. [RTN], Northrop unit Mission Systems, Bechtel National Inc. and Teledyne Brown Engineering.

      Moving on to the PAC-3 system, Kier said the $556 million in contracts from the Army Aviation and Missile Command is part of a lengthy success story for the interceptor system.

      For example, the Patriot program included a recent successful intercept of a target at White Sands, N.M., he observed.

      The PAC-3 contracts include production of 148 hit-to-kill PAC-3s, 17 launcher modification kits, spares and other equipment, as well as program management and engineering services.

      They will be made at Lockheed Martin factories in Dallas and Lufkin, Texas, Chelmsford, Mass., Ocala, Fla., and the PAC-3 All-Up Round facility in Camden, Ark. Deliveries on the contracts will be completed by July 2010.

      As part of these contracts, Lockheed will produce and deliver equipment to begin upgrading all Army Patriot fire units to the current Configuration-3 capability (two PAC-3 launchers per fire unit), allowing all fire units in the Patriot fleet to be capable of firing the PAC-3 missile.

      This U.S. Army initiative, called Pure Fleet, was launched in 2006 and will provide consistency across the fleet for the user anywhere Patriot is deployed or trained.

      Lockheed Martin is the prime contractor on the PAC-3 Missile Segment upgrade to the Patriot air defense system. The PAC-3 Missile Segment upgrade consists of the PAC-3 interceptor, the PAC-3 missile canisters (which each hold four PAC-3 missiles, with four canisters per launcher), a fire solution computer and an enhanced launcher electronics system.

      Kier discussed several other missile defense systems, including the Lockheed Martin-developed Aegis weapon system, PAC-3 Missile, the Terminal High Altitude Area Defense (THAAD) Weapon System, the Medium Extended Air Defense System (MEADS) and the Multiple Kill Vehicle (MKV) which utilize this proven advanced technology to deliver lethality against today’s most dangerous threats.

      As for the Middle East, the region may become an increasing sales opportunity for Lockheed.

      Israel has both the veteran PAC-2 system and the Arrow interceptor, and Lockheed officials have been in discussions with Israel about the PAC-3 system and its capabilities.

      Dennis Cavin, vice president of Lockheed Martin Missiles and Fire Control business development, noted that many nations have the older PAC-2 missiles and may be interested in upgrading to the PAC-3 system.

      Japan, the Netherlands and Germany lead the move, and the United Arab Emirates, Saudi Arabia and Kuwait could be interested in PAC-3.

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