Bomb-Detection Industry May See Growth

Investor interest in companies that make bomb-detection devices has surged since the TWA Flight 800 tragedy, the same way it did after the explosions at the Oklahoma City federal building last year and World Trade Center in New York in 1993.

Neither of those events prompted big orders for bomb-checking machines in the U.S., however, and those stock prices eventually fell after both incidents.

But this time, bolstered by President Clinton’s order that U.S. airports and airlines take more stringent security measures, the makers of bomb-detection devices may finally grow substantially.

“This issue has come up before with Oklahoma City, the World Trade Center, even the Pan Am Lockerbie incident,” Leah Cann, analyst at Oppenheimer & Co., said Friday. “Now, there seems to be a lot more attention paid to why we aren’t using the kind of technology that’s out there.”

A handful of innovative U.S. companies have created screening and detection devices that can find plastic explosives, which most X-ray machines in airports cannot.

The advanced machines, which range in price from $50,000 to $800,000, have been bought mostly by airports in Europe and the Middle East, where governments are typically responsible for airline safety. Very few are in use in the United States, where airlines pay for security measures and people have felt immune to the terrorism that has occurred elsewhere.

If investigators find that the TWA flight was brought down by a bomb, it would be the first time a plane has been terrorized after leaving a U.S. airport.

Sensing an opportunity for bomb-detection device companies, investors began to scoop up shares the day after the July 17 crash.

For instance, Thermedics Inc., whose equipment is being used by the FBI in the crash investigation, saw its shares rise Friday $3 to $28.75.

Logan Airport in Boston is working with Thermedics to test a walk-through scanning device that can tell whether a person is carrying plastic explosives. The airport may eventually become the first in the United States with such an advanced system.

“If Logan does this, it’s going to put pressure on other airports to do the same,” analyst Cann said. “We suddenly will have a market that we haven’t had before for this industry.”