Sequester has Lockheed eyeing new business model

The P-3 Orion aircraft undergoes maintenance, modification and refurbishment at Lockheed Martin in Greenville. Government contracts account for most of the facility’s workload, but Lockheed said it may seek commercial business. (Photo/Leslie Burden)
The P-3 Orion aircraft undergoes maintenance, modification and refurbishment at Lockheed Martin in Greenville. Government contracts account for most of the facility’s workload, but Lockheed said it may seek commercial business. (Photo/Leslie Burden)

Staff Report
Published May 23, 2013

Government contracts have been the bread and butter at Lockheed Martin’s Greenville facility, but grappling over federal spending could change that.

In the Upstate, Lockheed Martin rebuilds retired military aircraft, some up to 40 years old, outfitting them with new wing sections, stabilizer wings at the rear of the planes, rebuilt engine housings and modern digital displays in cockpits, among other upgrades. The upgrades can add 15 to 20 years of life to each airplane.

About Lockheed’s Greenville facility

Since opening in 1984, Lockheed Martin has reconstructed and delivered 2,785 aircraft from its operation at the S.C. Technology and Aviation Center in Greenville County. It will build nine more this year.

Currently, the site primarily works on the P-3 Orion, which is used as a maritime patrol and intelligence-gathering aircraft. The site also performs upgrades on the C-130 and has worked in the past on KC-10s and C-9s. The planes, which range from about 20 to 40 years old, are delivered to foreign allies, U.S. Customs and Borders Protection, the U.S. Coast Guard and other customers.

Fuselage sections arrive by truck from a storage facility in Tucson, Ariz. The new 44-foot wings are built at a Lockheed plant in Marietta, Ga., and delivered to Greenville. The horizontal stabilizers are built in Maryland. Lockheed Martin Greenville puts it all together. The fastest turnaround is about 18 months.

Lockheed delivered 31 aircraft last year. While it will deliver only nine planes this year, the extent of work will require the same number of work hours.

Lockheed has fully funded defense contracts that will provide work in Greenville through 2019, said site director Don Erickson, but moving forward, the company would like to attract more commercial work.

“The uncertainty driven by the sequester has prevented the DOD (Department of Defense) from moving forward on new contracts,” Erickson said.

In the mid-80s, Lockheed’s contract mix was 50% government, 50% commercial, but the company switched gears to chase opportunities with the DOD. Now those contracts are increasingly competitive, particularly with future spending uncertain.

Government-owned facilities in Warner Robins, Ga., Oklahoma City and Ogden, Utah, also perform these upgrades. Additionally, Lockheed competes with L3 Aerospace, Boeing and Northrup Grumman for contracts on this work.

“The environment has never been more competitive than it is right now,” Erickson said. “We believe we’re doing everything possible to be an affordable option.”

About 700 people work at Lockheed Martin’s Greenville site, 400 fewer than two years ago, as the aerospace company has reduced workforce to make operations more efficient. The 1.3 million-square-foot Greenville facility has 16 hangars and 3 million square feet of ramp space. Erickson said hiring is expected but he wouldn’t give details.

In 1999, Lockheed constructed a paint facility that could be its ticket back into the commercial sector, Erickson said.

The facility can accommodate narrow-body aircraft like the Boeing 737 — a large commercial jet heavily used by Southwest Airlines and many others — as well as the P-3 Orion and other planes. When Boeing announced plans to build the 787 in North Charleston, Lockheed approached the company about painting the massive Dreamliner.

“We’re 12 feet too short for the 787 work,” Erickson said.

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