Lockheed slashes jobs as U.S. defence spending cut
ATL A N TA • Lockheed Martin Corp., the world’s largest defence contractor, said on Thursday it plans to slash 4,000 jobs and shutter plants in several states to reduce costs in the face of declining U.S. defence spending.
The Bethesda, Md. , weapons maker will close the affected facilities by mid2015 to achieve job cuts that amount to more than 3% of its global workforce.
“Our customers face an increasingly complex global security environment with rapidly shrinking budgets,” Lockheed chief executive Marilyn Hewson said in a memo to employees entitled “Making Difficult Decisions to Secure Our Future.”
The plants being closed include operations in Akron, Ohio, that make parts for radar and surveillance systems; Newtown, Penn., which makes communications satellites; Goodyear, Ariz., which handles software development for sensors; and Horizon City, Tex., which performs final assembly of missiles.
The company said four buildings at its Sunnyvale, Calif., space systems operation will also be shut.
The plant closures will eliminate 2,000 positions, Lockheed said, while “operational efficiency initiatives” will pare another 2,000 in the information systems and global solutions, mission system and training and space systems business segments by the end of 2014.
Certain work will be relocated to other Lockheed facilities such as Denver and Valley Forge, Penn.
A number of defence companies have shed non-core divisions, consolidated facilities and cut jobs in recent years to cope with revenue declines as the United States, the world’s largest weapons buyer, pares its militar y budget.
The Pentagon, Lockheed’s biggest customer, is bracing for US$1-trillion in spending cuts over the next decade as part of the 2011 Budget Control Act and the U.S. sequestration process.
Even so, the company managed a 16% jump in earnings per share in the latest quarter and its stock has reached record highs.