Lockheed plane crash continues to haunt Lucas

FURTHER allegations that Lucas Industries supplied faulty components to US manufacturers hit its shares as analysts worried about the extent of the company's liability.

It emerged that Lucas equipment was implicated in a Lockheed aircraft crash in 1993 which killed seven people, and that substandard parts might have been supplied to Boeing. Shares, at one stage down 15p, finished down 5p at 193p.

Earlier this year Lucas was found to have falsified tests and supplied faulty parts for US military aircraft and missile launchers.

Lucas yesterday denied any liability for the crash, but disclosed that settlement of an aviation insurance claim was close after families of the dead issued lawsuits against the company.

It said: 'Products supplied by Lucas to this project fully match the customer's design specification. There is no liability arising from this issue which will affect the company's financial performance.'

Lucas also had to deny claims, made in the Wall Street Journal, that it was under criminal investigation for falsifying inspection reports for parts used on some Boeing passenger aircraft.

The crash might have been caused by the 'inadequate design' of Lucas parts, said the National Transportation Safety Board. A Lucas spokesman said the company continued to supply Lockheed, which showed the manufacturer's confidence. Settlement of the families' claim is likely to run into millions of pounds, but would be covered by insurance, he added.

The spokesman said the allegation that test procedures on parts to Boeing were inadequate had been settled. Lucas had admitted that some inspections of wing flap components had not been conducted.