State’s Space Firms Adapt to New Mission--Survival : Business: Industry is buffeted by budget fights, foreign competition. Commercial contracts help fill void.
Kim Garvey, an engineer at McDonnell Douglas Corp. in Huntington Beach, well remembers her seventh birthday. It was July 20, 1969--the day of the first moon landing. “I can remember no one was paying any attention to me on my birthday,” she recalls. “Everybody was watching TV.”
Now on the verge of her 32nd birthday and the 25th anniversary of the Apollo 11 lunar mission, Garvey works on the team designing the proposed space station, including the trusses that would form the station’s backbone.
But Garvey and the rest of California’s space industry face a far more uncertain future than their predecessors did in the 1960s, when the United States had a singular goal--beat the Soviet Union to the moon--and spared little effort or expense to win the race.
That golden era has long passed, replaced by a U.S. space program whose mission is debated constantly and whose funding is an annual tug-of-war in Congress. Partly as a result, the space business is trying to ensure its survival with its own form of defense conversion.
The $14 billion being spent by the National Aeronautics and Space Administration this year is 14% less than the agency spent in 1969 after adjusting for inflation, according to a calculation by UCLA.
Indeed, Garvey and the space station are symptomatic of the fiscal problems facing the space industry in California, which remains the industrial hub of NASA just as it was 2 1/2 decades ago.
NASA last year made huge changes in the station’s design and teamed up with the Russians to cut the station’s costs and get it aloft quicker. Garvey and her colleagues had spent four years working on the station’s propulsion system, but “my job went away” last year after Russians assumed that role, she said.
She was lucky enough to find work on other parts of the station, but her new job is not secure either. After much debate, Congress looks ready to approve another $2.1 billion for the station for this year, but the process must be repeated next year and each year after that. Each year, the station could be canceled altogether.
“It’s frustrating,” Garvey said. “It would be nice if there were multiyear budgets where you knew for the next five years if there was going to be a stable program.”
Budget squabbles aren’t the only hurdles for the state’s space industry. There are fewer contracts to build defense satellites and other military space gear because of Pentagon spending cuts. Worldwide competition in markets such as launch rockets is getting more intense.
These pressures have been building for years and have forced California’s space industry to slash costs or merge. The state has lost about 30,000 space jobs since the mid-1980s, including 1,700 lost at the McDonnell plant in Huntington Beach, which now employs 6,500.
Nonetheless, space is still a huge business in California--and will remain so even if the space station eventually is canceled.
The largest share of NASA’s annual budget, about $4 billion, still goes to California firms. That spending directly employs 37,000 people, or 24% of all NASA-funded jobs, the highest level in the nation, according to the governor’s office. Some 4,000 of those jobs are dedicated to the space station.
The total number of space-related jobs in California is probably closer to 60,000 when contracts from the Pentagon, foreign customers and commercial clients are included. Throw in the jobs indirectly tied to space and the number climbs well above 100,000.
There are also hundreds of engineers, scientists and computer experts at firms that provide extra brainpower and services to the space industry. They include the Jet Propulsion Laboratory in Pasadena, and Aerospace Corp. and Computer Sciences Corp., both in El Segundo.
All have had to tighten their belts because of the drop in U.S. space spending. But many also are developing products for commercial users, and those customers are funneling an ever-growing number of dollars into California’s space industry.
“If you go back a few years ago, there was almost no commercial space market,” said Daniel Goodman, an analyst at EDS Management Consulting Services in Washington. “Its growth has been remarkable.”
No one is exactly sure how big that market is, but consider:
* Los Angeles-based Hughes Aircraft Co. is launching a commercial satellite-to-home TV service called DirecTV, is building Malaysia’s first communications satellite, and plans to launch a $660-million, twin-satellite system dubbed Spaceway that would provide “on demand” telecommunications services early in the next century.
* Lockheed Corp.’s Sunnyvale-based space group, a leading satellite builder for the U.S. government, is also making satellites for Motorola’s Iridium cellular telephone project and marketing Russian-built rockets to other launch customers.
* NASA’s biggest contractor, Seal Beach-based Rockwell International, is using the Pentagon’s satellite-based global positioning system to develop electronic maps for Oldsmobile cars and tracking-data devices for commercial truck fleets.
* TRW’s space group in Redondo Beach, a leading builder of defense and scientific satellites, recently won a $61-million contract to build the first satellite for Taiwan’s new civilian space program. TRW also is using space technology to enhance the features of its vehicle air-bag restraint business.
Companies are hustling for these markets because they don’t expect a rebound in NASA and Pentagon spending for space before the next century. “We look at NASA’s prospects at best as flat,” said Mel R. Brashears, vice president of Lockheed’s Space Systems Division.
Yet as promising as the commercial market might be, it is unclear whether those sales will ever grow large enough to offset the loss of government space contracts and fill the void left by the massive layoffs.
“While we are looking at opportunities in commercial and international space arenas, they will not be a big portion of our business in the near future,” said Fred Brown, vice president for group development at TRW’s space unit.
As a result, some space experts believe, the number of workers is not expected to grow much and long-term job security will virtually disappear. “Even though we expect to do more (commercial) dollar work in the future, we also expect to be more efficient,” Brown said.
Anthony Cepavicius, a 39-year McDonnell Douglas veteran in Huntington Beach, where McDonnell built a part of the Saturn V rocket that lifted Apollo 11 to the moon, said not many younger people will have careers in space as long as his.
“There’s not going to be as many long-term programs,” said Cepavicius, now 61 and a tooling inspector on the space station project. “You’re going to see very few people like myself with 40 years” in the business.
Yet others are more optimistic, saying commercial and foreign customers will provide the state’s industry with substantial growth in the 21st Century.
Simon Ramo, 81, co-founder and former chairman of TRW, said the burgeoning commercial markets, combined with the “continued need” for U.S. research and military spacecraft, will give the industry annual sales “substantially in excess” of those in the 1990s.
EDS’ Goodman said the much-heralded information superhighway of the future will rely heavily on satellites, in addition to ground-based wired communications systems. “But it’s going to take longer than people had hoped,” at least a decade, he said.
In the meantime the space industry is still retrenching--and many Californians are still losing their jobs.
Just last month, Martin Marietta Corp. said it will move most of its Atlas rocket business from San Diego to Denver, where the company builds its Titan rockets. About 1,400 jobs will be transferred, 400 will be eliminated and 300 will remain in San Diego.
Rockwell Chairman Donald R. Beall, whose company built the Apollo 11 command module and the space shuttles, noted that Rockwell is also under pressure to keep cutting the shuttle fleet’s operating costs in the face of NASA’s tight budgets.
That means doing the same work with fewer people, and “it will be difficult to keep it (space employment) where it is,” he said.
The four shuttles were manufactured and are still repaired by Rockwell at its plants in Downey, Palmdale and Edwards Air Force Base, and its Rocketdyne unit in Canoga Park builds the shuttles’ main engines. (Rockwell’s fifth shuttle was the Challenger, which exploded in 1986.)
In May, Rockwell workers in Palmdale finished a $74-million upgrade of the shuttle Atlantis, which is scheduled to fly again in October. But they also began modifying Atlantis so the shuttle can eventually dock with the U.S.-Russian space station.
Elsewhere in the state, TRW--which built the smaller engine for the lunar landing craft that lowered Neil Armstrong and Edwin (Buzz) Aldrin Jr. to the moon’s Sea of Tranquillity--today builds communications, observatory and early warning defense satellites.
Examples: Tracking and data relay satellites, which form the backbone of NASA’s space-to-ground communications; satellites that analyze the Earth’s ozone layer, and scientific and intelligence satellites for the Defense Department.
Lockheed, besides working on the Iridium project, assembled and serviced the Hubble Space Telescope and services the shuttle fleet between launches. The company also is launching a business, called Space Imaging, to provide commercial high-resolution images of Earth taken from satellites.
McDonnell Douglas, in addition to its space station, is developing a radical launch rocket called the Delta Clipper-Experimental. The rocket blasts off and lands vertically and is one of several “single-stage-to-orbit” rockets that are being developed as potential alternatives to the shuttles, whose missions cost $360 million apiece on average.
Despite all the research into what space vehicles will be used in the future, the shuttles keep flying--keeping Rockwell as NASA’s biggest supplier.
“We see the shuttle operating for the next 20 or 30 years,” Beall said. But he knows that with NASA budgets shrinking, Rockwell must keep reducing the cost of flying the shuttle--or risk accelerating Uncle Sam’s search for a cheaper, replacement space vehicle.
Early in the next century, it is possible that Rockwell will be asked to build more shuttles. A permanent space station could be orbiting the Earth. A manned trip to Mars might be given serious consideration.
All would help protect California’s space industry and its workers. But those scenarios are expensive, so none is likely to happen without first sparking intense debate over whether the projects are worth taxpayers’ money. In any case, the industry by then could be supported more by commercial sales than by NASA.
That’s a far cry from the days of the Apollo program, said TRW’s Brown. “There’s clearly been a major change,” he said. “All of it revolves around the fact we don’t have the Soviet Union to compete with anymore.”
Major Space Sites
Southern California is the industrial center for the nation’s space effort. A look at some of the industry’s major facilities:
Rockwell International Corp. (Canoga Park, Downey, Palmdale), services the space shuttles (which it built) in Downey and Palmdale. Its Rocketdyne unit in Canoga Park builds/services the shuttles’ main engines, builds engines for the Delta and Atlas launch rockets and is working on the proposed space station.
Downey: 3,800 employees
Canoga Park: 4,400 employees
Palmdale: 70 employees
Jet Propulsion Laboratory (Pasadena), a major source of engineering and scientific technology for space.
6,000 employees.
Home of Hughes Space & Communications Co. (El Segundo), the satellite- building unit of Hughes Aircraft Co. 5,000 employees.
Also home of Hughes Communications Inc., which owns and operates the largest private satellite fleet in the world. 350 employees. Also home of Aerospace Corp., a nonprofit research and development firm that provides engineering for military satellite and launch systems. 3,000 employees. Also home of Computer Sciences Corp., a major provider of computer services to NASA. 400 employees.
Site of TRW Inc.’s Space Park (Redondo Beach), where the company builds a variety of satellites and other space gear for NASA and the Pentagon. 7,359 employees.
AlliedSignal Aerospace Co. (Torrance), which is producing parts for the space station. 300 employees in Torrance and 50 employees in Phoenix
Home of McDonnell Douglas Corp.’s (Huntington Beach), aerospace operation, which builds Delta rockets and parts of the space station. 6,500 employees
Site where Martin Marietta Corp. (San Diego), builds the Atlas rockets, but that operation
