* Furloughs will affect civilian workers one day a week
* CEO still opposing sequestration
By Andrea Shalal-Esa
WASHINGTON, May 14 The Pentagon's plans to put
most of its 800,000 civilian employees on unpaid leave for 11
days could lead to delays on Lockheed Martin Corp's F-35
Joint Strike Fighter and other weapons programs, a top company
official said on Tuesday.
Chief Financial Officer Bruce Tanner said Lockheed had not
been officially informed about the impact of the furloughs, but
civilian government workers have played a big role in supporting
flight testing and other work on the $396 billion F-35 jet, the
Pentagon's costliest weapons program.
"We'll lose the capability to remain on schedule for some of
our programs if in fact the government support that goes hand in
hand with our flight tests, for example, is reduced," Tanner
told Reuters in an interview at the company's media day.
Lockheed and other big weapons makers railed against budget
cuts required under a process known as "sequestration" for over
a year, warning that their across-the-board nature could result
in significant layoffs throughout the industry.
Defense Secretary Chuck Hagel on Tuesday said he decided to
move ahead with civilian furloughs only after exhausting every
other option to meet the congressionally mandated cuts. The
furloughs will begin on July 8, resulting in roughly one day of
unpaid leave per week for more than 600,000 workers through
September, the end of the fiscal year.
Lockheed's chief lobbyist, Greg Dahlberg, told reporters he
expected the Pentagon to release details about how the mandatory
budget cuts would affect procurement programs in early June.
He said the department had developed a list of 2,500
affected programs, but no details had yet emerged.
He said it was unlikely that Congress would be able to undo
the sequestration cuts for fiscal year 2013, but industry
executives were still hoping that lawmakers would reach
agreement on other deficit-reduction measures, which could help
avert the same across-the-board type cuts in future years.
Lockheed Chief Executive Marillyn Hewson told reporters she
continued to voice the company's opposition to the cuts in
frequent meetings with U.S. lawmakers and still hoped that
Congress would reverse or restructure the cuts, which are slated
to take effect over the next decade.
Most of the company's weapons programs take years to build,
which meant that the cuts would not have a huge impact on
contracts in the short-term, although shorter-term orders and
services were already seeing some slowdown, she said.
Tanner said government workers were involved in flight
testing of the F-35 jet in a variety of different jobs,
including working in the air traffic control tower, providing
mid-air refueling and piloting planes.
If those workers were missing 20 percent of the time, or the
bases where the planes are being tested shut down, the program's
schedule could be delayed, Tanner said.
He said the company was also bracing for a possible slowdown
in contract payments as a result of the reduced work time for
civilians, since a large part of the company's bills were
handled at a Defense Department facility in Columbus, Ohio,
which is staffed by many non-military employees.
"If all of a sudden people are only there for four days out
of five, do I get paid 80 percent of the bills that I send in,
or does it take that much longer," he said.