Word: tristar
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Dates: during 1970-1979
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...jobs question, opponents of the guarantee noted that if the TriStar went down and Lockheed workers were cut adrift, there would be more work for people making the DC-10 and its General Electric engines-and perhaps also for Boeing, which is considering building a similar plane. Would it be fair for Washington to support Lockheed workers at the expense of others...
Lockheed's supporters made an impassioned case. The company, they con- tended, had been victimized by bad luck. It had poured $900 million into developing a big new superjet, the 250-passenger TriStar. But its engine supplier, Britain's Rolls-Royce, had encountered such rough weather with the contract that it had to be taken over by government-appointed receivers. Lockheed had been financially weakened by problems with military cost overruns and, after Rolls-Royce went under, Lockheed's bankers refused to grant it more credit without a federal loan guarantee...
...TriStar died for lack of funds, not only would Lockheed lose the money that it had already spent on the plane, but subcontractors, airlines and banks would stand to lose up to $1 billion that they had invested in the project. If that happened, said Lockheed Chairman Daniel Haughton, his com-pany would fail. By Lockheed's estimate, that would cost 60,000 jobs-at Lockheed, at its subcontractors, and at countless supporting businesses. Other countries commonly subsidize their airframe industries, Lockheed supporters argued, and even the U.S. does so indirectly, through lucrative contracts for military planes that...
...secure enough risk for the nation's banks. Indeed Lockheed's creditors have testified that the company may well need more than $250 million. Opponents of the loan guarantee-including politicians from both parties, many economists and Lockheed's competitors -questioned whether the TriStar would ever be profitable. Chairman Haughton said that his company must sell 255 to 265 of the planes to make money on them. Lockheed reports 103 firm orders and 75 options for the TriStar so far, but its two biggest customers-TWA and Eastern-have been making arrangements to buy an almost identical...
...prospective carcass, deciding just which of its parts and programs would be attractive acquisitions for their own corporations. At least one competitor may have gone even further. According to Senator William Proxmire, McDonnell-Douglas has hinted that it might indemnify three airlines that have ordered Lockheed's TriStar against any down-payment losses-provided they switch their orders to the McDonnell-Douglas...