- The Washington Times - Tuesday, March 5, 2002

More than 6,000 workers at Lockheed Martin assembly plants nationwide plan to strike as early as next week.
Employees in California and Georgia rejected the Bethesda contractor's three-year contract proposal over the weekend. The workers, enjoying support from Lockheed Martin employees at four other plants, said they would walk out as early as Monday.
They and the company are said to be far apart on several issues, including health care premiums and the prevalence of subcontracting. Negotiations began in December.
Federal mediators have scheduled meetings this week between Lockheed Martin and its workers to discuss the proposals.
Analysts said that only a long and bitter strike would hurt the company. Shares of the nation's largest defense contractor were largely unaffected yesterday on the New York Stock Exchange, closing at $57, or 7 cents lower than the 52-week high reached Friday.
The employees, represented by the International Association of Machinists and Aerospace Workers, are almost exclusively "planners, expediters and assemblers" of aircraft, said union spokesman Frank Larkin.
About 2,600 of the employees work in the Marietta, Ga. plant, where the C130-J military transport plane and parts of the F-22 Raptor fighter jet are manufactured.
The C130-J is being used in Afghanistan as part of the war on terrorism. President Bush's latest defense-budget proposal includes plans to cut procurement of the craft in 2003 from eight to four. Meanwhile, production of the F-22 will grow from 13 to 23 planes.
The C130-J project would be the most heavily affected by a strike, analysts said, but Lockheed Martin likely will not suffer in the long term because of its contracts with the Pentagon.
"On defense contracts, there's not likely to be much of an impact at all," said Paul Nisbet, an analyst with JSA Research in Newport, R.I.
Mr. Nisbet said the Pentagon is often sympathetic to contractors facing work stoppages, and is unlikely to fine the company for delays. If the Pentagon expects deliveries of the C130-J planes in the fourth quarter, as it did last year, Lockheed Martin will have several months to make up for any lost production, Mr. Nisbet said.
Still, analysts say they do not expect Lockheed Martin's stock to remain at its current level.
"The stock is at the very least fully valued or perhaps a little overvalued at this point," said Robert Friedman, an equity analyst with Standard and Poor's, who rates the stock a "hold." Mr. Friedman says he has no plans to change his valuations on the company and advises against selling shares for now.
At least one analyst said he was jumping ship after hearing news of the potential walkout.
"You've got to think that when a strike comes, it can't be good," said Jeffrey Pittsburg, owner of Pittsburg Institutional, a research firm in Garden City, N.Y. "I've always believed that when you have a strike, it's time to step away."


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