ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Tuesday, November 19, 1996 TAG: 9611190096
SECTION: BUSINESS PAGE: B-6 EDITION: METRO
SOURCE: Associated Press
Just days after being named a finalist to make the military's new fighter jet, Lockheed Martin Corp. on Monday said it would eliminate 1,600 jobs as it looks for savings from its recent purchase of Loral Corp.
The nation's biggest defense contractor said new work from the fighter and other projects would eventually offset the job losses, but Lockheed isn't promising to rehire all the workers.
The company blamed shrinking defense spending, which has driven a rash of mergers in recent years, for the job cuts. Lockheed said it expects savings from the cutbacks to reach about $800million annually by 1999.
Lockheed employs 190,000 people worldwide and has annual sales of about $30billion.
Lockheed's purchase of most of Loral, which makes radar and other electronic devices, was approved this year by the Defense Department, which said the deal would also cut government costs. A smaller Loral Space & Communications Ltd. continues to stand alone.
Norman Augustine, Lockheed's vice chairman and chief executive, said the consolidation should make the company more competitive and save customers money.
Lockheed said it would close eight plants, some from Loral and some from Lockheed.
``They are working through, deciding what is essential,'' said Matt Baughman, a senior analyst with DFI International, a defense industry consulting firm in Washington.
In 1995, Lockheed ranked solidly as the top defense contractor, with U.S. military work generating nearly half its annual revenue.
Saturday, Lockheed got the go-ahead to develop a prototype jet fighter. Boeing was also named a finalist for the $219 billion deal. McDonnell Douglas lost out.
Lockheed this month also won a $1.8 billion defense contract to provide five satellites used to warn of missile attacks. The Pentagon could buy up to 15 more satellites, pushing the deal's worth to as much as $22 billion.
Earlier this year, Lockheed won a $900 million NASA contract to design the X-33, a fully reusable, wedge-shaped space vessel expected to be able to move people in and out of space with the ease of an airplane.
It was the first award of a new spacecraft design since 1972.
Lockheed plans to close facilities in California, Connecticut, New York, Pennsylvania and South Carolina by 1998. It will relocate its Systems Integration Sector headquarters in New York to Bethesda, Md., and close its Tactical Defense System facilities in Great Neck, N.Y., and Bloomfield, Conn.
LENGTH: Medium: 54 linesby CNB