Boeing’s Delta Program Gets a Boost From Rocket Launch

Boeing Co. conducted the first successful launch of its Delta III rocket Wednesday as the vehicle placed a mock satellite into orbit and put the hobbled program back on track after back-to-back flops.

The launch is a major boost to Boeing’s Huntington Beach-based Delta program, where about 8,000 designers and engineers work on the rocket. It also lifted morale at Boeing’s Rocketdyne Propulsion and Power unit in Canoga Park, which produces the main engine for Delta III and has been developing the engine for the next-generation Delta IV rocket.

The rocket lifted off from Cape Canaveral, Fla., at 4:05 a.m. PDT and put a 9,500-pound steel spool into orbit above the Atlantic Ocean 30 minutes later.

It was a critical launch for the world’s largest aerospace company after two previous attempts ended in disaster and placed the newest rocket program in jeopardy. Commercial satellite firms had hinted they would turn to competitors such as Lockheed Martin and Arianespace of Europe, among others, if the rocket failed again. Earlier this year, Lockheed successfully tested a Russian-designed engine on its Atlas III rocket.

“It feels great,” said Gale Schluter, head of the Delta program and general manager of Boeing’s Expendable Launch Systems in Huntington Beach. “We had this brand-new vehicle, and because of the unsuccessful attempts before, our customers wanted to wait and see what happened today. They wanted us to prove to them that the vehicle was flight-worthy and we demonstrated that the vehicle is ready for work.”

Proving its worthiness has come at a hefty price for Boeing, which will bear the cost of Wednesday’s launch. The Seattle-based company declined to say how much it spent, but the quoted price for a Delta III launch is about $85 million. The company had already taken a $34-million charge against second-quarter earnings to help cover the cost of the launch.

In addition, Boeing has lost nearly $500 million from the two previous Delta III launch failures and subsequent investigations.

Delta’s first attempt in August 1998 ended with the rocket exploding during launch because of a computer software glitch, destroying a PanAmSat Corp. satellite. Nearly nine months later, an engine combustion chamber cracked on a Delta III, leaving an Orion satellite built for Loral Space & Communications Ltd. in useless orbit.

Hoping to restore confidence in the program, Boeing moved ahead with Wednesday’s launch that carried a dummy payload similar to the Loral satellite. While it will not perform any functions, the Air Force and the University of Colorado will keep track of the white, 5 1/2-foot steel object as a test.

Aerospace analysts said it was unlikely Boeing would have scrapped the program even if Wednesday’s launch had failed, although the company would have had significant marketing and competitive problems.

“Boeing is pretty much committed to the launch program and they were not about to walk away because of a couple of failures,” said Walter Kaplan, chairman of Launchspace Inc., a Potomac, Md.-based space consulting firm.

Still, he said, the success of the launch was “very significant” for Boeing to remain competitive and “maintain a momentum” for its next-generation rocket, Delta IV.

“Delta IV is not going to fly for a while, but [Wednesday’s] successful launch will help Boeing carry over the momentum from Delta III to Delta IV and maintain confidence with the market,” Kaplan said.

Indeed, Boeing’s Schluter said, the company has 18 orders for Delta III launches but customers had been reluctant to commit to ordering more pending the outcome of Wednesday’s launch.

While Boeing’s earlier-generation rockets, such as the Delta II, have had few problems, commercial clients have been looking for rockets that could carry heavier payloads. Delta III is designed to carry more weight at reduced cost.

Company officials said they hope to launch the next Delta III carrying a customer’s payload in the first quarter of next year. Customers for Delta III include Hughes Space & Communications, a unit of Hughes Electronics Corp., Loral Space & Communications and SkyBridge.

Eventually, Boeing envisions four to six flights beginning in 2002. The Delta IV rockets are not expected to fly until 2005.

The launch also provided a morale boost for Boeing workers in Southern California, where the aerospace industry has been hit hard by layoffs.

Boeing is the largest employer in Orange County, with about 14,000 workers in Huntington Beach, Seal Beach and Anaheim.

In June, Boeing announced it would eliminate 900 jobs in Huntington Beach over the next two years as it shifts Delta III rocket parts production to Pueblo, Colo., and Decatur, Ala.

The cuts represent about 11% of the nearly 8,000 workers in Huntington Beach.

In trading Wednesday on the New York Stock Exchange, Boeing shares rose $1.25 to $50.56.

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Peter Pae covers aerospace for The Times. He can be reached at peter.pae@latimes.com.