Questions Remain for Convair’s Uneasy Employees : Aerospace: Hughes Aircraft, General Dynamics say announcement on mechanics of merger is months away.
Hughes Aircraft’s announcement Monday that it will buy General Dynamics missile manufacturing operations, including Convair of San Diego, may have answered one question by supplying the identity of the operation’s likely new owner, a question that has been hovering since January, when General Dynamics first indicated it would sell the unit.
But several other questions remain, including how many of Convair missile’s 4,500 local jobs will be lost as a result of the consolidation with Hughes Aircraft’s missile division, and at what cost to San Diego’s economy. In a joint statement Monday, Hughes Aircraft and General Dynamics said a plan laying out the logistics of the merger could take months to complete.
As missile workers came off shift at General Dynamics’ Lindbergh Field plant Monday, they complained that the company has kept them in the dark, and most expressed pessimism that they will still have jobs once the consolidation is completed.
“Nobody knows what the hell is going on,” machinist R. M. Nunez said.
Brian Biggs, a nine-year employee, said his co-workers are skeptical about the chances of keeping their jobs.
“People all think we’re out of jobs. Everyone’s afraid they won’t be there when (Convair’s missile operation) gets moved to Tucson,” Biggs said. “I’m just disappointed with the way it’s been handled. We hear rumor before we hear fact. So a lot of people are standing around talking about what might happen to them.”
Jeanne Phillips said she is fatalistic about the news: “We all knew it was coming. Hughes is a good outfit.”
Sandra Rosenbalm said waiting for the decision will be difficult. “They say they’ll let us know at the end of three months,” she said. “If they let me know something sooner, I’d feel more at ease.”
In an interview Monday, Michael C. Keel, General Dynamics’ executive vice president of missiles and electronics, indicated that the job cuts in San Diego could be deep. Of the 4,500 Convair missile jobs, about 2,500 associated with the advanced cruise missile were facing elimination anyway, with or without a sale to Hughes Aircraft, Keel said. That’s because the Air Force contract for air-launched cruise missiles is being phased out in August, 1993, because of budget cuts announced last year by President Bush.
The remaining 2,000 jobs, those associated with the Tomahawk cruise missile, a missile fired from submarines and surface ships, face a “reasonable likelihood” of being consolidated into another facility as Hughes tries to pare down its unused plants and place as much of its missile assembly operations under one roof as possible, Keel said.
In Tucson, Hughes operates a huge, 2.2-million-square-foot plant that will be half empty by the end of the year. Hughes is also acquiring General Dynamics’ 2.1-million-square-foot Pomona plant that is now 25% unused.
“It is very unlikely that we could allow the Tomahawk to remain in place as a stand-alone program and be competitive,” Keel said. Convair and McDonnell Douglas compete as dual sources for the Tomahawk in bidding for the Navy’s 400-missile-a-year procurement.
Another grim portent of Hughes Aircraft’s intentions is that it will take short-term leases of General Dynamics facilities in San Diego to give itself maximum flexibility in possible relocations. Convair’s missile operation occupies 700,000 square feet of leased space at Lindbergh Field and 500,000 square feet in a complex owned by General Dynamics in Kearny Mesa.
“If they signed a long-term lease, it’s a good indication that they will use the facility for a long while,” said Dan Pegg, president of the San Diego Economic Development Corp. “If it’s a short-term lease to accommodate a phase-out, then that’s a whole other story.”
Pegg expects heated attempts by Rancho Cucamonga and Tucson civic leaders to try to steal Convair’s Tomahawk business away.
“We know that competition is out there (for the Tomahawk business),” Pegg said. “We’re going to see formidable competition from Arizona and Rancho Cucamonga. This is an opportunity that everyone wants to seize.”
“My suspicion is that Hughes will be pretty straightforward about its intentions once we can sit down with them,” Pegg said. “We’re going to work along with the mayor’s task force. And we’ll make a strong case for San Diego.”
Public figures Monday vowed to fight the loss of Convair jobs, citing the devastation the loss could wreak on San Diego’s economy. If friendly persuasion isn’t sufficient, Mayor Maureen O’Connor promised to invoke antitrust laws to fight a relocation. On Monday, she announced the formation of a task force to keep Convair jobs here.
Rep. Duncan Hunter (R-Coronado) said he and other members of the San Diego congressional delegation will meet with Hughes officials this week to plead San Diego’s case. Hunter promised to throw his weight around as a member of the House Armed Services Committee if necessary.
William Hickey Sr., president of International Assn. of Machinists and Aerospace Workers Local 1125 that represents about 5,100 Convair workers, said the measures that Mayor O’Connor takes to woo Hughes will be pivotal.
“There has been some rhetoric to the effect that Tucson will do what’s necessary to bring (the GD missile business) there,” Hickey said. “If that’s the case, then we want to see what the mayor can do” about influencing Hughes.
But Jerry Cantwell, an aerospace analyst with Wertheim Schroder investment firm in New York, was pessimistic, saying San Diego officials could be swimming against a very strong tide in trying to reverse a trend in consolidation of facilities and assets, a result of the dramatic defense budget cuts of recent years.
“The trend clearly is that the industry has excess capacity in facilities and people, and that over-capacity has to be reduced one way or the other,” Cantwell said. The Hughes acquisition and probable consolidation are “an efficient way of doing it that potentially holds benefits for both GD and Hughes.”
Cantwell said the missile industry includes “half a dozen players, and there is not enough business out there to support six.
“We’ll see a concentration of the business among the top two or three and a reduction in work force among the others. . . . It’s just not economical at the low production rates to support as many players as there have been in the past.”
Meanwhile, General Dynamics Convair employees wait and wonder.
Randy Roark, a 12-year Convair employee and a vice president of Local 1125, said: “Morale is at an all-time low. People feel as if they’re getting hit from all sides. . . . Frankly, most people would rather work for Hughes.”
Virginia Cobb, a 31-year Convair veteran, said Monday’s announcement would have an impact on “hourly, salaried, professional and white-collar people. . . . Every employee (at General Dynamics) is worried.”
“They’re always asking for patience, patience, patience,” Cobb said. “But, what do they give us in return? Rumors, rumors, rumors. . . . They give us different information every day, which is causing lots of frustration.”
Divisions of Hughes Aircraft, General Dynamics Compared
GENERAL DYNAMICS MISSILE MANUFACTURING
CONVAIR DIVISION
Headquarters: San Diego
Kearny Mesa plant: 500,000 square feet; 2,000 employees; manufactures Tomahawk sea-launched cruise missiles.
Lindbergh Field plant: 700,000 square feet; 2,500 employees; manufactures advanced cruise missiles.
AIR DEFENSE SYSTEMS DIVISION
Headquarters: Pomona
Pomona plant: 2.1 million square feet; 2,400 employees; manufactures Standard missiles, Phalanx Close-in Weapon System.
Rancho Cucamonga plant: 1 million square feet; 1,900 employees; manufactures Stinger weapons system, rolling airframe missiles (RAM).
HUGHES AIRCRAFT MISSILE SYSTEMS GROUP
Headquarters: Canoga Park
Canoga Park plant: 950,000 square feet; 2,000 employees; manufactures prototypes, research and development for a variety of future weapons programs.
Tucson plant: 2.2 million square feet; 4,800 employees; manufactures advanced medium-range air-to-air missiles (AMRAAM); Phoenix missiles, TOW missiles and Maverick missiles.
RELATED STORY: A1
Merger of Weapons Makers General Dynamics Convair Division Tomahawk Sea-Launched Cruise Missile (SLCM) Customer: Navy Contractors: General Dynamics Convair Division in San Diego; McDonnell Douglas in Titusville, Fla. Mission: For use against land targets and ships Launch Platform: Submarines and surface ships Standard Missile Customer: Navy Contractors: General Dynamics Air Defense Systems Division in Pomona; Raytheon Missile Systems Division in Bedford, Mass., and Bristol, Tenn. Mission: For use against aircraft Launch Platform: U.S. Navy ships and ships of eight foreign navies Phalanx Close-in Weapon System Customer: Navy Contractors: General Dynamics Air Defense Systems Division, Pomona; GE Aerospace, Pittsfield, Mass. Mission: Defense against aircraft and anti-ship missiles Launch Platform: U.S. Navy ships and ships of 10 foreign navies Stinger Weapon Systems Customer: Army Contractors: General Dynamics Air Defense Systems Division, Rancho Cucamonga; Raython Missile Division, Lowell, Mass. Mission: Defense against aircraft Launch Platform: The missile is deployed by infantry, ground-combat vehicles, helicopters and Navy ships. Sparrow Missile Customer: Navy Contractors: General Dynamics Air Defense Systems Division, Camden, Ark.; Raytheon Missile Division, Lowell, Mass. Mission: Air-to-air combat and defense against aircraft Launch Platform: Air-to-air version carried by F-4, F-14,F-15 and F-18 aircraft. Sea Sparrow surface-to-air version is deployed on U.S. Navy ships and ships of NATO allies. Rolling Airframe Missile (RAM) Customer: Navy Contractors: General Dynamics Air Defense Systems Division, Rancho Cucamonga; RAM System GmbH, GermanyMission: Defense against aerial threats Launch Platform: U.S. Navy ships and ships of NATO allies Hughes Aircraft Advanced Medium-Range Air-to-Air Missile (AMRAAM) Customer: Air Force, Navy Contractors: Hughes Aircraft Mission: Air-to-air combat Launch Platform: F-15, F-165,F-14 and F / A-18 fighters Phoenix Missile Customer: Navy Contractors: Hughes Aircraft Mission: Air-to-air combat Launch Platform: F-14 fighter Maverick Missile Customer: Air Force, Navy, Marine Corps Contractors: Hughes Aircraft Mission: For use against hardened targets, missile sites, ships and armored vehicles Launch Platform: Various U.S. and foreign aircraft TOW Anti-Tank Missile Customer: Army, Marine Corps Contractors: Hughes Aircraft Mission: For use against armored vehicles Launch Platform: Ground forces and helicopters
