Air Force Contractsfor Delta IIs : Aerospace: Deal for production of as many as 36 rockets could be worth $1 billion to struggling McDonnell Douglas unit in Huntington Beach.
The Air Force has awarded McDonnell Douglas Aerospace a rocket production contract that could be worth as much as $1 billion, the company said Friday.
The deal for construction of as many as 36 of McDonnell Douglas’ Delta II rockets is a major victory for the company, which has been beset in the past year by cost-cutting layoffs and the cancellation of a $500-million test program for the “Star Wars” system.
There is also a cloud over the future of Space Station Freedom as NASA struggles with White House-ordered budget cuts. McDonnell Douglas Aerospace, based in Huntington Beach, is a subsidiary of McDonnell Douglas Corp. in St. Louis, which won more than $3.5 billion in space station work.
The aerospace unit is already under contract for as many as 28 Delta rockets for the Air Force through 1995. Like the old contract, the new one calls for the rockets to carry NAVSTAR global positioning navigational satellites, company spokeswoman Sheila Carter-Hale said.
The Delta rocket program, a mainstay of the space division, has brought McDonnell Douglas as much as $50 million in revenue for each military launch under the old contract.
The new pact calls for 25 Delta rocket launches at Florida’s Cape Canaveral, beginning in 1996, Carter-Hale said. It also contains a “launch on demand” clause, meaning that McDonnell Douglas must provide a rocket within 40 days of a new launch order.
The agreement allows the Air Force to order between one and six rockets a year from McDonnell Douglas, Carter-Hale said, meaning that the number of Delta II launches could be extended to 36.
Though no jobs are expected to be created by the new Delta II deal, Carter-Hale said, it ensures work for current employees. In November, the company laid off 245 people at its Huntington Beach and Santa Ana facilities.
McDonnell Douglas spokesman Larry Gales said the contract is an indication of the military’s confidence in the Delta II rocket, which is one of three major U.S. launch vehicles. Martin Marietta and General Dynamics also supply rockets to the government.
