Lockheed and Airbus in talks on joint projects

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The Independent Online
Lockheed Martin, the American aviation and defence giant, revealed yesterday it was in talks with Airbus Industrie on possible collaborative projects. The news prompted speculation that Lockheed Martin, which has no civilian aircraft business, could join with the European aeroplane consortium on the development of the proposed Airbus super-jumbo, the A3XX.

Simultaneously yesterday, Delta Airlines confirmed it was in talks with Airbus and Boeing on a purchase deal to replace its fleet of ageing L- 1011 wide-body jets originally supplied by Lockheed.

Philip Condit, chief executive of Boeing, told reporters during a visit to London yesterday his company would not reverse its decision to scrap plans for a super-jumbo and the field was open to Airbus.

Responding to a report in yesterday's Baltimore Sun, a Lockheed spokesman, Keith Mordoff, confirmed the contacts with Airbus. "We're exploring what opportunities there might be for us to work together on projects," he said.

A spokesman for Airbus Industrie, North America, Sandy Smith, was more circumspect. "I cannot confirm or deny that talks have been made with Lockheed," Mr Smith said. The newspaper said that Lockheed's chairman and chief executive, Norman Augustine, travelled to Toulouse for talks with Airbus last month.

Analysts were unsure whether as a first step Lockheed would risk involving itself in a project as ambitious as the A3XX. The estimated cost of developing the plane, which would carry more than 400 passengers, is about $8bn. It was the high price tag that persuaded Boeing to shelve plans last year for an even larger successor to its series of 747 models.

Equally, however, there are reasons both companies might be attracted to collaborate on the plane. Lockheed could provide capital as well as marketing clout in the US. A partnership would also give Lockheed the chance to re-enter the commercial jetliner business which it abandoned in the early 1980s.

Lockheed has also found itself in danger of being eclipsed as an aviation leader in the military business since Boeing and McDonnell Douglas unveiled their plans to merge with one another. The market for the A3XX is believed to range between 400 and 1,400 orders from airlines world-wide.

Delta, meanwhile, was said yesterday to be considering entering a long- term, exclusive purchasing deal with Boeing for its future aircraft replacement needs. This was played down, however, by Mr Condit. "We haven't reached any agreement at this stage," he said.

Delta's first priority is replacing its 55 L-1011 aircraft, which still make up 10 per cent of its fleet. An initial order to replace them is expected to be for about 25 planes.