_Aerospace Daily

Staff
House and Senate budget negotiators are determined to strike a deal this week with the Administration on a balanced budget plan, which will allow the congressional budget committees to move forward with the fiscal year 1998 budget resolution. The negotiators may take up the defense portion of the budget later this week. Senate and House defense authorizers are prodding the budget committees to set a defense topline that would allow for about a $4 billion increase in the president's request.

Staff
Aerospace/Defense Stock Box As of closing April 18, 1997 Closing Change UNITED STATES DowJones 6703.55 + 44.95 NASDAQ 1222.57 + 5.50 AARCorp 30.25 + .25 AlldSig 70.875 + .625 AllTech 43.00 - .25 Aviall 11.25 0

Staff
The World Bank is preparing guarantees to protect Chase Chemical Bank against political risk in Russia and Ukraine in connection with Chase's support of the Boeing-led Sea Launch venture. A World Bank spokesman says the board of the international lending agency probably will decide in late May whether to back two guarantees of $100 million each for work at Ukraine's NPO Yuzhnoye and Russia's RSC Energia on the Zenit booster and D-2 upper stage that will form the Sea Launch vehicle. World Bank President James D.

Staff
One of the reasons the U.S. has had limited success in fielding UAVs is that industry hasn't been fully supportive, Gen. Israel says. "I'm not sure American industry was willing to commit to" the UAV business, he says."We're not going to have a lot of success unless American industry is going to apply the A-team." To help explain why support has been lacking, he points to the perceived lack of profit margins.

Staff
The National Defense Panel set up to critique the Pentagon's Quadrennial Defense Review has no objections to Defense Secretary William Cohen's plan to defer parts of the review, including those related to infrastructure, until a later date. NDP chairman Phil Odeen told the House National Security Committee last Wednesday Cohen's believes "that his time [on the job] is so short that he couldn't come to grips with all issues." He added that this was "probably a smart thing to do given the timeframe he is in."

Staff
The concept of Information Operations (IO) is still emerging, but much of its potential may be revealed in the next four years. U.S. Navy Capt. Greg Blackburn, who works IO issues for the Pentagon, says he anticipates "that by the next [Quadrennial Defense Review] it may be possible to put forward certain elements of Information Operations and trade them off against force structure."

Staff
U.S. briefings to European countries about High Altitude Endurance unmanned aerial vehicles are closely linked to attempts to sell NATO the Joint Surveillance Target Attack Radar System, Gen. Israel says. The UAVs would be cued by Joint STARS to get higher resolution data. They would work "hand in glove," he says. He also says that if the Europeans are interested in airborne ground surveillance, they should also be interested in UAVs.

Staff
Outgoing European Space Agency Director General Jean-Marie Luton appears to have gained a substantial foothold in the management of Europe's space launch consortium, although the issue isn't settled yet. Directors of Arianespace SA and its previously toothless holding company, Arianespace Participation, last week named Luton chairman of Arianespace Participation and put him in charge of preparing a report on "the strategic and operational evolution of Arianespace and the evolution of its structures" for their next meeting at the end of May.

Staff
Russian Air Defense Forces (VPVO) have conducted a successful test of the S-300 surface-to-air missile using a refurbished S- 75 SAM as a target, clearing the way for regular use of the old missiles in the new role. According the Krasnaya Zvezda newspaper, the modified S-75 (called SA-2 by NATO) offers VPVO reduced cost, increased availability and more efficient combat training. It wasn't clear which version of the S-300 was used in the test, the S-300P (SA-10), or the S-300V (SA-12).

Staff
THE U.S. AIR FORCE B-1B Defensive System Upgrade Program (DSUP) has been given permission to move into the engineering and manufacturing development (EMD) phase. Noel Longuemare, the deputy Pentagon acquisition chief, cleared the program for EMD last Friday after a review.

Staff
Northrop Grumman Corp. said its first quarter earnings and income climbed 23% thanks to a full quarter's worth of performance from its new Electronic Sensors and Systems Div. (ESSD), the former Westinghouse Defense Electronics and Systems business. The company earned $75 million on sales of $1.96 billion in the first quarter. In the same quarter last year, profits of $61 million on sales of $1.6 billion included only one month of operations of ESSD.

Staff
Meanwhile, twelve senior members of the House are asking their colleagues to join them in signing a letter to President Clinton stating they won't support any budget compromise that doesn't begin the process of shifting funds from military to non-military programs. The letter is being circulated by a group that includes Democratic Whip David Bonior (Mich.) and House National Security Committee Ranking Democrat Ron Dellums (Calif.). The Democrats stress the importance of increasing spending for education, the environment and job training.

Staff
Norman R. Augustine, chairman and chief executive officer of Lockheed Martin, will retire Aug. 1 and turn over his duties as CEO to Vance D. Coffman, who currently serves as president and chief operating officer, the company announced Friday. "This is the right time to move on to the next generation of leadership now in place at Lockheed Martin," Augustine said in a prepared statement.

Staff
The U.S. Army will upgrade its Joint Tactical Ground Station (JTAGS) between 1999 and 2004 to handle Space-Based Infrared System data rather than buying new ground equipment, according to Army officials. The Army, Air Force and Navy last year signed an memorandum of agreement to jointly developed the Multi-Mission Mobile Processor (M3P). The idea was to combine the in-theater receipt capability of JTAGS with the strategic mission the AF wants to undertake (DAILY, April 11, 1996; Nov. 7, 1996).

Staff
The Dutch government ended its offer of funds for a restart of bankrupt Fokker in a letter from Economics Minister Hans Wijers to Parliament Wednesday. Wijers called it a "bitter conclusion." Earlier this month, Fokker's receivers said that final talks had collapsed (DAILY, April 8). The Wednesday move represents the end of any special government help for the company, a spokesman for the Economics Ministry told The DAILY yesterday. He said, however, that if another private offer comes up, the government might offer assistance in other ways.

Staff
The U.S. Air Force hopes the simulated participation of an Airborne Laser in the Roving Sands joint warfighting exercise will provide insights into the its concept of operations, or conops. "What we hope to do is get some things that help in the conops, and there may be see some spinoff in operational requirements," said Lt. Col. Jeff Stough, Air Combat Command's ABL program branch chief. Although the ABL operational requirements document has been finalized, Stough said updates could benefit from the exercise.

Staff
ALLIEDSIGNAL AEROSPACE said its new 131-9-A auxiliary power unit for Airbus single-aisle aircraft completed its critical design review and first engine test ahead of schedule. The new APU is expected to give Airbus operators "significant improvements in reliability and cost of ownership," the company said. Projected production rate is 300 units a year by 2000.

Staff
The U.S. Army is for the first time will tie together its two primary missile defense system in this year's Roving Sands exercise in Texas and New Mexico to evaluate the payoff of such a configuration.

Staff
The Royal Australian Air Force this month is expected to make its initial cut of competitors for an anti-radiation missile, clearing the way for the final downselect next year. Competing to fit RAAF F-111 and P-3 aircraft with an anti-radar missile are Texas Instruments with the High Speed Anti-Radiation Missile (HARM), Hughes Aircraft with a dual-mode seeker variant of the Maverick missile, the British ALARM, and a French and Israeli system, according to Capt. William Belden, who manages the HARM program for the U.S. Navy.

Staff
Swissair and Sabena ordered A330-200 airliners from Airbus Industrie, making them the first European customers for the planes. Deliveries to both airlines will begin in September 1998. Swissair ordered nine of the jets, all to be powered by Pratt&Whitney engines. Swissair President Philippe Bruggisser said that A330s are "our passport to more cost-effective long haul operations." The aircraft have a range of up to 6,300 nautical miles.

Staff
The Taiwanese Air Force has officially commissioned the first wing of the domestically-produced Indigenous Defense Fighter (IDF). The 427th Wing, commissioned on April 15th, is based at the Chingchuankang (CCK) Air Base near Taichung in central Taiwan. The first of the locally-designed and manufactured IDFs was delivered in 1992 and the first squadron was commissioned in December 1994.

Staff
Poland and Sweden have signed an agreement on classified military information that Saab says will benefit efforts to sell the JAS-39 Gripen fighter to Poland. The April 15 agreement "means that Polish air force pilots now will be able to fly Gripen and experience for themselves the performance of the aircraft," Jan Hammarstrom, Saab vice president in charge of marketing the Gripen, said in a statement.

Staff
NASA may launch two Defense Support Program (DSP) early warning satellites on its Space Shuttle early in the coming century as part of expanded cooperation with the U.S. Air Force that could also include a 25- year "roadmap" for joint space transportation technology development drawing on civilian and military work in the field.

Staff
AN ARIANE 44LP booster orbited two Asian satellites Wednesday night in the 24th consecutive successful launch for the Arianespace consortium. Japan's direct-broadcast BSAT-1a satellite, built by Hughes Space and Communications, and Thailand's Thaicom 3, built by Aerospatiale, lifted off at 7:08 p.m. EDT and achieved their proper geostationary transfer orbits, Arianespace said.

Staff
McDonnell Douglas Corp. said a combination of costs relating to the Delta II failure in January, increased investment in the MD-95 jetliner and Delta III development programs, merger activities and the mid-1996 strike bit into 1997 first quarter earnings. The company earned $181 million on revenues of $3.2 billion, compared to profits of $198 million on sales of $3.1 billion in the first three months of 1996.