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UAL, Alliant to Jointly Bid for Airliner Defense System Contract

November 12, 2003|From Bloomberg News

Alliant Techsystems Inc. said Tuesday that it was teaming with UAL Corp.'s United Airlines to compete for a contract to equip U.S. commercial aircraft with missile defense systems.

Bids must be submitted by Dec. 8 to the Homeland Security Department, which will move quickly to award a contract to begin supplying the devices to commercial airlines, said Brian Roehrkasse, a department spokesman.

An Alliant defense system is in use on 1,100 U.S. military aircraft, company spokesman Bryce Hallowell said.

The Homeland Security Department plans to spend $100 million in the next two years to protect jetliners against the threat of shoulder-fired missiles. It would cost billions of dollars to equip the fleet of about 6,800 U.S. commercial jets at a cost of as much as $1 million a plane.

Northrop Grumman Corp., Raytheon Co. and BAE Systems also are competing for the contract.

Edina, Minn.-based Alliant's partnership with Chicago-based United Airlines is the first to involve a major U.S. air carrier in the competition, Hallowell said. No United representative was available for comment.

Shares of Alliant rose 9 cents to $51.90 on the New York Stock Exchange. UAL is undergoing a reorganization under Bankruptcy Court protection.

Alliant's missile defense system is in use on aircraft such as the C-130 Hercules military transport.

Hallowell said no plane equipped with it had been shot down during use in Iraq, Afghanistan and Kosovo, a province of Serbia. The system employs flares that divert heat-seeking missiles away from planes, he said.

"We've got a system that's available today and is battle-proven," Hallowell said. "We are definitely in the game."

Century City-based Northrop Grumman's missile defense system is used on about 200 military aircraft.

Northrop's system proposed for civilian planes detects a missile and uses a laser to confuse the guidance system and make the missile veer off course, company Vice President Robert Del Boca said at a Washington news conference.

Northrop could put its system on 300 commercial jets used to transport troops and supplies to war zones within a year if the government approves, Del Boca said. The deployment would cost $810 million if done in a year or $600 million over 18 months, he said.

Alliant's equipment costs "substantially under $1 million" per plane, Hallowell said, without giving details.

Waltham, Mass.-based Raytheon estimates its system could be installed for $600,000 to $700,000 per aircraft, said spokesman Ron Colman. Its technology includes a missile-detecting radar made by state-owned Israel Aircraft Industries Ltd.'s Elta Systems unit and an infrared countermeasure.

Raytheon's system would release hundreds of chemical-coated metal disks about 3 inches in diameter, he said. The disks would oxidize on contact with the air, generating heat that would divert an incoming missile.

"Our system is technologically simpler and more affordable when compared with laser-based solutions," Colman said.

London-based BAE Systems is supplying a laser-based system that already is used on some U.S. Army aircraft, said Alan Mertz, director of BAE's bid. He declined to say how many planes use it or how much it would cost to place on commercial aircraft.

Lockheed Martin Corp., the largest U.S. defense firm, participated in an "industry day" held to provide information on the competition, company spokesman Jeff Adams said. He declined to comment on whether the Bethesda, Md.-based firm would enter the competition.

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