Lockheed said Friday that it plans to move its Advanced Development Projects unit--known as the Skunk Works--out of Burbank and relocate it at its facilities in Palmdale over the next several years.
Lockheed has never disclosed how many jobs it has at the top-secret Skunk Works, but it undoubtedly accounts for a large percentage of the company's more than 12,000 jobs in Burbank and is widely believed to be the site for construction of the Air Force's F-19 stealth fighter plane.
The Skunk Works, which is famous for building some of the nation's most advanced military aircraft over the past four decades, currently operates in aging structures, some of which date to World War II. In addition, the growth of the adjacent Burbank airport has encroached on the Skunk Works' facilities, making it more difficult to maintain security for the top-secret operation.
The facilities were dubbed the Skunk Works by workers in the 1940s because fumes from a nearby chemical plant filled their new quarters with a foul odor. The name was taken from a moonshine still featured in the Lil' Abner comic strip.
No Precise Timetable
A story appearing this week in Lockheed's employee newspaper, which carried the byline of John Brizendine, president of Lockheed Aeronautical Systems, confirmed that the company plans to relocate the Skunk Works in Palmdale. He also indicated that a number of buildings would be sold off at the Burbank complex, which sprawls over 340 acres.
Lockheed spokesman James Ragsdale said the Skunk Works already has some facilities in Palmdale, which is 54 miles from Burbank, and that other operations would be moved there in future years as buildings are constructed. Ragsdale indicated that the plans do not set an exact timetable for the move.
The company has already sold several parcels of Burbank land, including one to the City of Burbank. The Lockheed land there is worth an estimated $1.5 million to $1.7 million per acre, according to Seth Dudley, branch manager of the commercial real estate firm of Julien J. Studley Inc.
Ragsdale said Lockheed is not abandoning Burbank, pointing to recent investments in equipment and facilities at the location. The company only last year established a large composites development facility in a newly purchased structure.
"We are not planning a massive pullout," Ragsdale said.
Separately, Lockheed said Friday that as many as 1,500 jobs will be moved from Burbank to Georgia, starting in 1991, as part of its previously reported decision to relocate production of parts for a new Navy patrol aircraft.
When Lockheed won the contract Oct. 14 to produce the new Navy aircraft, it said the program would result in about 3,000 assembly jobs at its large facility in Palmdale, which would offset the job transfers to Georgia.
"It continues to be part of our planning for . . . (the new plane) that final assembly will take place at Palmdale, but it is part of our planning that parts fabrication will be done at the Marietta, Ga., plant," Brizendine said in a statement.
Decision Not Final
The program to build 125 of the new Navy patrol aircraft, which is formally known as the Long Range Air Anti-Submarine Capable Aircraft or LRAACA, will be worth about $5 billion over the next decade. Lockheed won the program over competing bids by Boeing and McDonnell Douglas.
The LRAACA is a successor to Lockheed's P-3 aircraft, which is assembled in Palmdale with parts that are largely produced in Burbank. That program currently employs a total of about 3,000 workers in both locations.
Several Lockheed officials indicated Friday that the decision to assemble the new plane in Palmdale was not final. In its formal proposal to the Navy, however, Lockheed priced the program on the basis that the aircraft would be assembled in Palmdale, according to knowledgeable sources. Thus, the current ambiguity in Lockheed's position is a clear departure from its plans formally presented to the Navy less than a month ago.
The job losses at Burbank and any potential losses at Palmdale will not be immediate. Lockheed said it plans to continue building parts and assembling P-3s in California until orders run out, which is expected to occur in two to four years. Then, the LRAACA would follow and jobs would begin to shift.
Lockheed has committed itself to keeping production plants both here and in Georgia open, but it has excess capacity. The current effort to divide the LRAACA program is necessary, because the firm's workload is declining along with military budgets, said one Lockheed official who asked not to be identified.
Since it is one of the few new aircraft programs in the military budget, LRAACA has become highly politicized. Lockheed employees have speculated that Senate Armed Services Committee Chairman Sam Nunn (D-Ga.) has exerted political pressure on Lockheed to move the work to his home state.
Lockheed has built the C-5B cargo jet at its plant in Marietta, Ga., but that program is now winding down and the company is laying off about 8,000 workers there.
Arnold Punaro, Democratic staff director for the Senate Armed Services Committee, said Friday that Nunn has not been involved in discussions with Lockheed over the Navy program, but that he himself thinks the idea of moving the work is an "excellent idea."
"It sounds to me like it makes sense," Punaro said. "The overhead in Georgia is a lot lower than the overhead in Palmdale. We have always believed that the Georgia operation is a very efficiently run operation. The overhead in Georgia is, without question, lower than the overhead in California."
He added, "But to the best of my knowledge, the subject has never come up."