Word: anderson
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Dates: during 1970-1979
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...year-long search, Haack and other directors considered about 100 outsiders for the job of permanent chairman. But they eventually concluded that to bring in someone new would set Lockheed back while the outsider familiarized himself with the company. So the choice fell on Anderson, who knows Lockheed thoroughly. After serving as a naval officer during World War II and the Korean conflict, he joined the company in 1956 and worked his way up through several financial posts to vice chairman and chief financial officer. In that job, he was aware of some jiggery-pokery in Lockheed's foreign...
...Anderson must try to lessen the TriStar drag that has left Lockheed trailing badly behind its chief competitors in the commercial aircraft market, Boeing and McDonnell Douglas. Last year all three had comparable sales: $3.2 billion for Lockheed, $3.5 billion for McDonnell Douglas and $3.9 billion for Boeing. But while McDonnell Douglas earned a profit of $109 million and Boeing $103 million, Lockheed netted only $39 million. Reason: an operating loss of $125 million on the airbus. The news this year is no better. In the first six months, Lockheed's profits rose to $25.5 million, from $22.2 million...
Nonetheless, Anderson is adamant that Lockheed will continue to manufacture the TriStar. He has high hopes for the long-range version of the plane (British Airways has ordered six) and has set up a new financial affiliate that will arrange favorable terms for prospective buyers. The inability to do that while Lockheed's own finances were in a mess is a major reason why TriStar sales have never matched the company's predictions. Anderson's most immediate problem is to arrange short-term loans to replace an estimated $80 million of the Government-guaranteed loan...
...Anderson further has the luck to take over at a time when the always cyclical civilian aircraft industry seems to be starting on an upswing. Although McDonnell Douglas' deliveries of DC-9s and DC-10s will drop from 65 in 1976 to 37 this year, the company has already booked orders for 54 planes to be finished in 1978. Executives and industry analysts expect the upturn to continue. Some airlines have more money to buy planes because traffic is rising and earnings are improving (even Pan Am may report a profit for the first time in nine years...
...Anderson himself raises one thorny problem about Lockheed's new code of conduct. Says he: "One thing that still has to be considered is the question of what advantage this may give to foreign companies" if they are less scrupulous about making under-the-table payments to aircraft buyers. Investors obviously are not worried. Although payment of a dividend is a long way off, Lockheed's stock has about doubled in price this year, to around $ 18 a share...