Boeing Co.‘s government launch services business faces short-term and potentially long-term delays as the company’s union machinists went on strike Nov. 3. The strike could push back the three remaining Delta rocket launches planned for the balance of 2005, although Boeing spokesman Robert Villanueva said the company may try to get at least one mission completed with non-union employees.

More than 1,000 members of the International Association of Machinists and Aerospace Workers walked off the job Nov. 2 over objections to certain benefits concessions proposed by Boeing in the company’s contract offer to the union.

The three missions that could be delayed by the strike include the Geostationary Operational Environmental Satellite-N (GOES-N) for NASA and the U.S. National Oceanic and Atmospheric Administration (NOAA), NASA’s Calipso/Cloudsat mission and NROL-22 for the U.S. National Reconnaissance Office (NRO). Of the three, GOES-N may still be launched in 2005, even if the strike is prolonged, Villanueva said.

East Coast Delay

The Delta 4 that will launch the GOES-N spacecraft is on a launch pad at Cape Canaveral Air Force Station in Florida and is ready for flight. The mission has seen a number of delays dating back to May, with the most recent attempt to launch this satellite scrubbed Aug. 16 when the system monitoring battery voltage on the second stage of the launch vehicle set off an alarm. GOES-N is designed to provide more accurate prediction and tracking of severe storms and other weather phenomena to aid in providing earlier and more precise warnings to the public.

“We are remaining optimistic that we may very will still be able to launch the rocket by the end of the year,” Villanueva said. “We are assessing to see if we have the right people that are non-union employees who can still be able to launch that vehicle. We will probably have a better picture on this mission in the next week or so.”

Union spokesman Kevin Cummings , however, was not optimistic that Boeing could get the GOES-N up without the support of union workers. “There are going to be no launches until this is settled,” Cummings told Satellite News. “The Department of Defense, NASA and all the customers down the line all require security clearances, efficiency testing and certifications for all sorts of processes and some of those take hundreds of hours of practical experience before you can reach the level of expertise … for certain techniques. Even if the engineers started doing that work, it would be close to a year before they could do anything.”

West Coast Delays

The other two missions that face delays will originate from Vandenberg Air Force Base in California and both have considerably more work needed in order to get those missions off the ground.

“We’ve got a Delta 2 rocket which is being prepared to launch the Calipso/Cloudsat pair of satellites for NASA,” Villanueva said. “That rocket does not have the spacecraft on board yet. NASA made the decision not to move the spacecraft to the launch pad to be integrated with the rocket because of the pending strike situation.”

The third mission will be the first Delta 4 launched from the West Coast, Villanueva said. The rocket will deliver a classified satellite for the government, and the NROL-22 spacecraft is not attached to its launch vehicle.

“We were trying to launch that one in early October, but we had to stand down and delay the launch because of a couple of technical issues that have been closed out,” Villanueva said. Then, because of the recent Titan 4 launch, “we had to remove the spacecraft from the rocket at the direction of the NRO, because the NRO did not want to fly the Titan 4 rocket over our launch pad with another one of their satellites onboard our Delta 4 rocket.”

Villanueva added there are no targeted launch dates for the rockets at Vandenberg due to the strike situation. There are about 100 employees who support the Delta 2 and Delta 4 operations at Vandenberg who “play a pretty critical role in the processing of the rockets.”

More Delays?

Villanueva noted that the three launches were the only missions on Boeing’s manifest for the remainder of 2005, and “the ripple effect will probably start next year. The other factor that is involved here is we have to work with U.S. Air Force range officials for them to assign us launch dates on the ranges. That is a variable and we have to consider their input as well.”

If the strike is resolved quickly, “we’ll have to assess how quickly they can integrate the satellites on the rockets and prep the vehicles and get a launch range date assigned to us by the Air Force and then launch,” Villanueva said. “If [the strike is not resolved quickly], then we will have a better picture as to our long-term launch schedule as the weeks go by.”

Villanueva did not have the company’s 2006 launch manifest immediately available and could not say when the three remaining 2005 launches might take place if they were pushed into 2006, but he noted that Boeing has “quite a few launches planned for 2006.”

James White, a union spokesman for machinists at Vandenberg said the DMSP-17 satellite for NOAA is on deck at Vandenberg and also could be affected by the strike. That launch, using a Delta 4 rocket, currently is planned for between March and May.

With the labor action still in its early stages, it is difficult to predict what the long-term effect of the strike will be. If the strike stretches on for several months, Lockheed Martin‘s Atlas 5 could see some more action to deliver spacecraft into orbit. But that possibility is still very speculative.

“It is unlikely anything would get switched over to Atlas unless it looked like this was a long-term strike, and there was no choice but to get those payloads moved over,” Jeff Foust, launch industry analyst with Futron Corp. told Satellite News. “Nothing that I have seen has indicated that’s being contemplated as a possibility.”

Even if payloads were shifted to the Atlas 5, Foust noted that additional challenges could arise because the Atlas 5 has yet to be launched from Vandenberg Air Force Base.

Boeing spokesman Daniel Beck said the company does have contingency plans in the event of a long-term labor action, but declined to provide any details.

Compensation At Issue

The main issue that led to the strike is Boeing’s adjusting of health benefits for future employees and the removal of retiree health benefits.

“This is about the future of our communities and the people that come after us here,” union spokesman Bob Wood told Satellite News. “They are making drastic cuts in our health care benefits, and that is untenable. For a company that made $1 billion in profit [in the third quarter], they are coming at us like they are a company in bankruptcy demanding concessions. Then they are taking away completely the retiree medical coverage for future retirees and for new employees. Anyone hired [under] this contract won’t be able to have retiree benefits, and [Boeing] changed the eligibility rules so some of our people that were eligible under the old contract would not be eligible under the new contract for retiree medical coverage.”

Boeing’s Beck offered a different perspective on the labor issue.

“We made a very generous offer in terms of the net boost in income for these employees throughout the course of the three years of the contract,” Beck told Satellite News. “We felt it further enhanced retirement security in terms of big boosts in pension benefits and savings plans. We certainly believe it maintains top-flight health benefits for employees and their families at a very modest cost to those employees. We’ve submitted that as our best and final offer. The union considered it, voted to reject the contract and voted to go out on strike. At this time, there are no further negotiations scheduled but Boeing certainly would certainly welcome any proposals that the union wishes to put forth that we could discuss.”

Neither side would speculate on how long they expected the strike to last.

ULA Activities Unaffected

One area that likely will see no impact from this labor action is Boeing’s ongoing efforts to merge its government launch services business with Lockheed Martin in the United Launch Alliance (ULA) joint venture.

The ULA was announced earlier this year (SN, May 9) and currently is being reviewed by the U.S. Federal Trade Commission to determine if there are any anti-trust issues that might result from the joint venture’s formation. The alliance also is facing a lawsuit from Space Exploration Technologies Corp., which is attempting to block the formation of ULA, alleging that Boeing and Lockheed Martin are attempting to exclude competition from the government launch services market.

“We don’t believe it imposes any hindrance at all,” Beck said. “Lockheed Martin and Boeing are still working together very closely. We are still very committed to making this thing happen. We are providing the government with the final information they need to assess before they make their decision with regard to the anti-trust implications of the ULA. But we are still moving forward.”

Foust concurred that the labor action will have no connection to the formation of the ULA.

–Gregory Twachtman

(Robert Villanueva, Boeing, 714/372-2089; Jeff Foust, Futron, 301/347-3405)