AIL Systems Will Close Area Plant : Westlake Village: Most of the aerospace firm’s local employees face layoffs after the Air Force cancels a B-1 contract.
In August, AIL Systems Inc. plans to close the doors of its facility in Westlake Village and lay off most of the 290 employees there, ending the workers’ role in the story of the U. S. Air Force’s beleaguered B-1 bomber.
AIL’s employees will face a tough job market, joining thousands of Southern California aerospace industry workers who’ve lost their jobs recently. But while they are getting their pink slips in the middle of a recession, AIL’s employees are not simply the victims of broad economic problems.
They are losing their jobs to the latest twist in controversies that have raged for years over the B-1 and the way it has been paid for.
It has been nearly 20 years since the B-1 first entered development. The plane was designed to carry nuclear weapons deep into Soviet territory and to use advanced electronics to jam enemy radar. Work on the first version of the B-1 was begun in 1974, but the bomber was canceled by President Jimmy Carter in 1977, before being revived by the Reagan Administration. But the plane has long suffered from budgetary problems and technical glitches.
Rockwell International was the prime contractor on the B-1 airframe, but many other companies were involved in the plane, including AIL, which is owned by Eaton Corp. in Cleveland.
For AIL, the latest and fatal blow came in February when Air Force Secretary Donald B. Rice said the military would cancel a contract with AIL for improving the electronic systems for defending the B-1 from enemies.
Rice blamed Congress for essentially cutting off funds for the AIL contract. But Rep. John Conyers Jr. (D-Mich.), chairman of the House Committee on Government Operations, has said the Air Force is playing a political game with the B-1 money and the jobs it supports.
Regardless of the political dispute, for AIL, the thrust of Rice’s comments was simple. “They actually ran out of money,” said Darrell Reed, AIL’s chief financial officer.
Since the Air Force secretary’s announcement, AIL, which is based in Deer Park, N. Y., has laid off 1,000 workers in New York. And on June 3, the 290 Westlake Village employees--engineers, technicians, assemblers and others--got notice that most of them would lose their jobs, too.
Reed said that while AIL has been working on the B-1, the company has tried repeatedly to find work that could replace the B-1 contract and prevent layoffs in Westlake Village.
Indeed, he said the company spent $2 million doing research and development during the last two years to try to win other business. Dennis Kane, director of the company’s Westlake Village operation, said for example, that the company has bid to do work on the B-2 Stealth bomber similar to what it has done on the B-1.
But, because of the funding dispute, the end of the B-1 work came two years sooner than AIL expected, Reed said, so layoffs can’t be avoided.
To help ease the pain, AIL will contact other companies with information about the employees who are being laid off, help employees write resumes and provide other counseling for the workers, according to Robert O’Neil, manager of human resources for the company in Westlake Village.
The history and politics surrounding the B-1 are complicated.
The Air Force’s decision to cancel the AIL contract comes at a time when some say the problem-plagued plane might be abandoned in favor of the newer B-2 Stealth bomber. The latest embarrassment for the B-1 is that it was grounded during the Persian Gulf War because of engine troubles.
Conyers has all but accused the Air Force of calling off the B-1 development contract to pressure Congress into spending more money on the B-2. The Air Force has denied that it has any such plan.
But clearly, the B-1’s history of technical problems is part of the reason that AIL’s contract is in jeopardy now.
When the bomber was revived by President Ronald Reagan in 1982, AIL won the contract to design and build its “defensive avionics”--or electronic systems meant to protect the plane from enemy weapons and radar.
AIL’s Westlake Village operation has worked on the B-1 project since 1988, and was to design and create computer systems for testing the defensive avionics.
To date, Reed said, AIL has been paid $4 billion for its B-1 work, including work done both in Westlake Village and New York. But that amount is dwarfed by the planes’ total costs: The Air Force has spent $30 billion to design and build 100 of them.
After five years work, the Air Force concluded in 1987 that the defensive avionics systems simply wouldn’t do what had been planned back in 1982. Specifically, Air Force officials disclosed early that year that the plane’s electronic radar-jamming system would not allow the plane to fly safely over certain Soviet antiaircraft sites, as it was expected to do.
Reed said the Air Force had always expected that the plane might not live up to expectations at first because of the speed of its development.
But the problems raised a furor in Congress. So the Air Force came up with a salvage plan: settling for a defensive avionics system that would do less than originally planned, and embarking on a program to make sure that the planes at least satisfy that standard.
AIL won a contract that has been worth about $300 million, thus far, to do that work, too.
But, in a move that has now come to hurt AIL’s employees, the Air Force decided to pay for the new work with what Rep. John D. Dingell (D-Mich.) called a “semi-secret slush fund”--actually an account containing leftover money that Congress had allocated to the Pentagon for other purposes.
Last year, Congress acted to prevent the Pentagon from using such funds. It is that change that the Air Force secretary pointed to as the reason that it could no longer pay an additional $300 million for AIL’s contract.
Since then, the House has approved a plan to appropriate the money for continuing the work on B-1’s avionics, but even if the appropriation is approved by the Senate and the President, it will come too late to save the jobs of most of AIL’s Westlake Village employees.
“It will not save very many, although it could save a few,” AIL’s Reed said.
