bpendlet@bambam.UUCP (Bob Pendleton) (02/24/90)
From article <1990Feb16.055039.11227@utzoo.uucp>, by henry@utzoo.uucp (Henry Spencer): > [From Flight International, 3 Jan:] > McDonnell Douglas reports imminent cost overruns on its USAF contract to > launch Navstars on Deltas. They're blaming it on half a dozen different > things, which boil down to minor technical problems plus seriously > optimistic cost estimates. [Ah, those cheap expendables with their > well-known, predictable costs.] Hercules Inc. posted a $100 million loss this quarter. The first losing quarter in 70 some odd years. The entire loss was the result of mistakes made by the Aeorspace devision. Part of the loss can be explained by the cost of blowing up a brand new solid propellant mixing plant. But most of the loss is due to grossly underbidding the fixed price contracts for the Titan IV and Delta II solid boosters. After so many years of bidding for cost plus contracts they didn't really know how to bid for a fixed price contract. They don't seem to know what the real costs are. The actual loss by the Aerospace division is said to excede $200 million. Heads are reportedly bouncing all over Magna, Utah as Hercules Inc. restructures the management of Hercules Aerospace. I've read that Hercules stock dropped to it's lowest price in decades, reportedly $30/share, or roughly $10/share below book value. Even though Hercules has been working hard to get into the commercial launch business with its Pegasus and Taurus launch vehicles and its commercial participation in Titan IV and Delta II it is clear that the change over from defense contractor to space entrepreneur is a long and dangerous one. Bob P. -- Bob Pendleton, speaking only for myself. UUCP Address: decwrl!esunix!bpendlet or utah-cs!esunix!bpendlet X: Tools, not rules.