McDonnell Douglas to Develop Delta III : Aerospace: The launch rocket will be designed in Huntington, stabilizing that facility’s work force.

McDonnell Douglas Corp., securing a contract worth up to $1.5 billion over the next 10 years, said it will develop the next generation of its Delta launch rocket that would be capable of lifting satellites twice as heavy as its current launcher can carry.

McDonnell’s Huntington Beach space group, McDonnell Douglas Aerospace, will design and develop the Delta III rocket, stabilizing the work force at the facility.

The company will use current employees initially but could hire a few more later, said W.P. Olson, senior vice president for space and defense systems. Most new hires will end up in Pueblo, Colo., where the rocket will be assembled, and at the launch site in Cape Canaveral, Fla.

Under contract with its first customer, Hughes Space and Communications International Inc. in Los Angeles, McDonnell will begin the first of 10 launches in 1998. Hughes, the world’s largest builder of commercial satellites, also has options for more launches through 2005.

The deal will help McDonnell spend about $200 million for the new rocket’s development.

The Delta rocket, which is known for its reliability, is an intermediate-size launch vehicle that McDonnell has built since 1960. The Delta’s major components are built in Huntington Beach for final assembly in Colorado and its first-stage main engines are built by Rockwell International Corp.’s Rocketdyne unit in Canoga Park.

The development of the Delta III enables McDonnell to compete better in the space launch market against such rivals as Lockheed Martin Corp. and Arianespace of France.