McDonnell Says It Won’t Renew Lockheed Pact

McDonnell Douglas will not renew Lockheed’s subcontract to build wings for its Air Force C-17 cargo jet, the company confirmed Sunday.

The Air Force plans to buy 211 C-17s. A spokesman for Douglas Aircraft, a McDonnell Douglas subsidiary, said the decision to drop Lockheed was based on cost overruns and schedule delays. The subcontract work is worth more than $1 billion.

Lockheed is expected to complete final assembly of its first six C-17 jets at its plant in Marietta, Ga. The Douglas spokesman said the company was seeking alternative subcontractors and had received bids on the work.

Separately, the Douglas spokesman said the firm has inspected 82 master tools on the C-17 program and has found only two that require repair. It was reported Friday by The Times that Douglas was ordered to inspect all of the C-17 master tools after Air Force officials discovered alterations on quality-control records.

A sample inspection last year found that 12 out of 23 tools were out of correct tolerances. But the Douglas spokesman said Sunday that the 12 tools were approved for use “as is” by the Air Force.