The Big Bird’s in Big Trouble : Answers needed: Pentagon may need more, not fewer, C-17s in an era of regional crises

A cynical line that is particularly good for a laugh at income tax deadline goes like this: “I’m from the federal government and I’m here to help you.”

In the case of McDonnell Douglas Corp. and its struggle to prevent huge overruns with the C-17 military transport plane being developed at its Long Beach plant, the line may be right on the mark.

Other aerospace companies in Southern California are keeping their heads above water, due in part to the fact that the Pentagon budget will not shrink as fast as seemed certain before the Persian Gulf crisis.

It’s a different story at McDonnell Douglas. Last year, the Long Beach plant got a very bad report card from the Air Force on the quality of its work. Whether or not that came as news to management is hard to say. But company shake-ups did follow the report. It may well have been a case of a genuine helping hand from Washington.

Now, Air Force analysts say that McDonnell Douglas is in serious trouble and getting in deeper, perhaps as deep as a $500-million overrun on the C-17. The company says that figure is excessive, although it agrees that it may exceed its $4.9 billion cost limit for developing the plane, which will be big enough to carry M-1 tanks.

Some months ago the company set out to save $700 million by eliminating 9,000 jobs at its Long Beach facility and 8,000 elsewhere this year. Even before the layoffs, the company was having trouble meeting development and production deadlines, not only on the C-17 but on its MD-11 and MD-80 commercial jetliners.

The current problem involves an Air Force judgment that the McDonnell Douglas estimate of the costs of finishing the development phase of the C-17 are far too optimistic.

One irony in all this that must seem particularly cruel to McDonnell Douglas is that many analysts assumed that when the Cold War wound down, the United States would have less need of a plane designed to rush troops and weapons into battle. In cutting his budget, Defense Secretary Dick Cheney trimmed the projected fleet of C-17s from 210 to 120.

But the Pentagon’s airlift capacity had enough gaps after Iraq invaded Kuwait that it had to commandeer commercial planes to transport troops. It may turn out that the Pentagon needs more, not fewer, C-17s in an era of regional crises. For its own sake and that of its employees and for the sake of an effective fighting force in a world no longer dominated by the Cold War, McDonnell Douglas must get it together.