U.S. May Allow Hughes to Continue Missile Program

Defense Secretary Caspar W. Weinberger has signaled his intention to continue development of a sophisticated air-to-air missile at Hughes Aircraft despite his earlier threat that he might cancel the program because of technical difficulties and soaring costs.

Last January, Weinberger delayed a decision on future purchases of the Advanced Medium Range Air-to-Air Missile (AMRAAM) and instructed the Air Force to study ways either to reduce the cost or find an alternative weapon.

The AMRAAM is one of Hughes’ largest programs. The Air Force and Navy plan to buy more than 24,000 of the missiles for more than $10 billion, although some future purchases will be split with another producer.

Although no official decision has been announced, Assistant Air Force Secretary Thomas Cooper met with Weinberger last week to discuss the AMRAAM program and emerged with an apparent agreement. Cooper was quoted as testifying to a Senate defense appropriation subcommittee on May 14 that Weinberger made the decision to proceed with the AMRAAM and that a memorandum to that effect is in the works.

Hughes officials have acknowledged taking “big losses” on the AMRAAM program. Earlier this year, Cooper told Congress that Hughes had pledged $200 million of its own money to continue AMRAAM.

The company has apparently spent all of the $557 million provided in its contract and still has substantial work left to prepare the program for production.

The Air Force apparently plans to stretch out the remaining development of the missile and substantially cut funding, reportedly to $7.5 billion from $8.4 billion.

Even with Weinberger’s approval, the program faces major hurdles. The House Armed Services Committee voted May 9 to kill the program in fiscal 1986. The Senate Armed Services Committee chopped $125 million from a request of $539 million for the program, with more cuts possible.

In a separate development, the Air Force said this week that it successfully tested the first AMRAAM at the White Sands Missile Range in New Mexico.

“I never had any doubts about the technical capabilities of the missile itself,” Hughes Senior Vice President Malcolm Curry said in an interview. “I am more worried from a business point of view. It is clear that we need the military capability.”