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Technology Stocks : Loral Space & Communications

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To: Valueman who wrote (6304)6/16/1999 11:03:00 PM
From: SafetyAgentMan  Read Replies (1) of 10852
 
June 17, 1999 Threat of losing customer clouds first Atlas 3A launch By Robyn Suriano FLORIDA TODAY CAPE CANAVERAL, Fla. - Florida's newest hope for gaining more business in the tough international launch market will be ready to fly next month - if the rocket has a satellite to carry into space. Even as Lockheed Martin unveiled its new Atlas 3 vehicle Wednesday, officials said their first customer may take its business to a European-run launch site in South America. The situation highlights the fierce competition U.S. companies are facing from overseas as they struggle to recover from recent launch accidents that included three private satellites valued at more than $500 million. "Anytime you have a rash of failures, everybody gets skittish and looks for a safe haven someplace," said Paul Nisbet, a stock analyst who follows aerospace companies for JSA Research Inc. of Newport, R.I. "But America is committed to the satellite (launching business), and I'm sure that things will settle down after a few successful flights here." In this case, the problem is the Atlas 3 rocket uses an engine similar to one that apparently failed on a May flight of Boeing's new Delta 3 rocket. The engine is used on the Atlas 3's Centaur upper stage, which must be cleared of any problems before the new rocket can fly, said John Karas, vice president of launch systems development for Lockheed Martin Astronautics. But he said the company expects the issue to be resolved within a couple weeks, clearing the way for their maiden launch around Aug. 17 from Cape Canaveral Air Station. Meantime, Karas said their customer - Loral Space & Communications of New York - is considering switching their Telstar 7 television satellite to Europe's Ariane 4 rocket launched from South America. Officials from Ariane and Loral would not discuss the possible switch Wednesday, but a Loral spokeswoman said the company is reviewing its options. "We're just looking at what launches are available to us and matching those with the (spacecraft) that we have to launch," said spokeswoman Jeanette Clonan. Officials from Arianespace, the company that markets the Ariane rocket, said their schedule could accommodate the mission. But they would not discuss the deal specifically. The loss would leave Lockheed Martin without a passenger and delay the Atlas 3's maiden voyage until late this year after another customer could be found. "There's a lot of 'if's' now, and I can't predict the future," Karas said. "But at this point, we're working toward an August launch." Downplaying the possible problem, company officials focused Wednesday on the rocket they hope will capture more launch business by catering to heavier satellites. The Atlas 3 can carry almost 10,000 pounds into geostationary orbit - a 2,000-pound increase over Lockheed Martin's current Atlas 2 vehicle. It will compete with Boeing's Delta 3 rocket, Europe's Ariane 4, the Chinese Long March and the Russian Proton for heavier communications satellites. The booster also is an important bridge to an even bigger Lockheed Martin vehicle - the Atlas 5 - that is under development. Many of the larger booster's systems will be flown on the Atlas 3. The cornerstone of the new rockets will be a Russian-made engine, marking the first use of another country's technology on an American launch vehicle. Lockheed Martin said the Russian engine, built near Moscow by the company Energomash, has fewer parts and increased power. That makes it both more reliable and capable of lifting heavier payloads. "We went out and looked for the best rocket engine on the face of the planet," Karas said. The engines will be manufactured exclusively in Russia for the next four years. After that, the U.S. company Pratt & Whitney will begin making the same engines at its plant in West Palm Beach, Fla. While using the Russian engine, Lockheed Martin is subject to government restrictions that prohibit sharing U.S. rocket technology with other countries. Karas said Russian technicians always are escorted while working at Cape Canaveral Air Station and are not given access to any information that isn't relevant to installing and checking their engine. Lockheed Martin has sold five of its Atlas 3 vehicles - three are booked for Loral spacecraft and two have been bought by the Pentagon for spy satellites. However, analysts would not be surprised if the first Loral launch goes to South America. In the past two years, Loral has lost 13 spacecraft on different rocket failures. One was a failed Ukranian Zenit launch in September 1998 that cost them 12 cellular telephone satellites. The other was the Delta 3 failure in May that left a television satellite in a uselessly low orbit. "It's a very difficult industry and Loral has been burned badly in the past," Nisbet said. "So it makes sense if they were a bit touchy right now. They're going to steer clear of anything that hints of a possible problem."
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