Lockheed Martin Corp. and Boeing Co., the top two U.S. defense companies, must provide more details on potential cost savings from their proposed rocket-launching joint venture to win regulatory approval of the plan.
The Federal Trade Commission and the Defense Department are seeking the additional information from the two companies as part of an antitrust review, Air Force Undersecretary Ronald Sega said Tuesday in Washington.
When Lockheed and Boeing made public their planned United Launch Alliance venture in May, the companies said it would save the government $100 million to $150 million a year. Now the government wants to see how the companies reached those numbers.
The venture would be based in Jefferson County and employ about 3,800 workers.
“The review needs to take place in an organized, comprehensive and thorough fashion,” Sega said. “The bottom line is to provide assured access to space and do that at a lower cost to the taxpayer and provide value to the Department of Defense.”
Lockheed and Boeing have “had a lot of exchange of information with the Pentagon and FTC,” said George Muellner, Boeing’s head of Air Force programs.
The requests don’t imply any lack of support for the venture, Muellner said at the Air Force Association annual conference in Washington.
The companies had been “strongly encouraged” by the Air Force to set up the venture, he said.
“They wanted a lot of information addressing the savings side of the proposed joint venture,” Muellner said. “That detail is being put together at this time.”
The Wall Street Journal reported Tuesday that the requests for more cost information were evidence of wavering support for the plan from the military, without identifying the source of its information.
Boeing and Lockheed have come to rely more on government launch contracts, which the Air Force has said could total more than $6 billion through 2011, as demand for commercial satellite launches has waned.
There is no decline in enthusiasm for the venture within the Air Force, said Gen. Lance Lord, head of the service’s Space Command.
“I’ve sat with both,” Lord said. “I know they are both qualified and capable. Put them together, we get the best of both worlds. I think we have a good match here.”
Sega declined to comment directly on the level of the Pentagon’s support for the joint venture.
