Missile Co-Production Could Save $11 Million.

Defense Department gives Lockheed Martin waiver to consolidate manufacturing

An agreement to co-produce two different types of anti-tank missiles for the Army and the Marine Corps at a single manufacturing plant promises to save the contractor and the U.S. government about $11 million.

The co-production of these two munitions, the Army's Javelin and the Marine Corps' Predator missiles, is expected to open the door for similar cost-saving manufacturing initiatives in the defense industry.

In contrast to previous missile-assembly operations, the production of the Predator will take place on the same manufacturing line as the Army's Javelin anti-armor missile. Defense Department safety regulations have prohibited such operations in the past in order to prevent the loss of two product lines in the event of an accident. However, Lockheed Martin Missiles and Fire Control has obtained approval to allow the co-production of the two missiles in the Javelin manufacturing plant in Troy, Ala.

Currently, the Troy plant manufactures the Hellfire, Longbow, Javelin and AGM-142 missiles in three primary manufacturing facilities located on its 3,200 acre site. The plant started its manufacturing operations with the Hellfire missile in 1994 and has produced more than 8,500 Patriot missiles for the Army.

In addition to the upcoming production of Predator, the Troy plant is preparing to manufacture the joint air-to-surface standoff missile (JASSM) and the theater high-altitude area defense (THAAD) missile.

Much of the success of the Troy plant can be traced to its multi-skilled workforce that is organized into manufacturing teams. These teams use cell manufacturing and a continuous-flow process to achieve high levels of quality and efficiency in their products, including a yield rate of about 98 percent for new missiles.

New processes at the Troy plant are implemented in part through Lockheed Martin's involvement in the Defense Advanced Research Projects Agency's (DARPA) affordable multi-missile manufacturing (AM3) program. AM3 encourages the use of technology and advanced manufacturing processes in the production of missiles. Lockheed Martin's AM3 initiatives include the development of flexible tooling and the use of virtual manufacturing software that allows managers to develop and analyze different manufacturing layouts for their production facilities.

It was through the use of virtual manufacturing that Lockheed Martin was able to develop a plan to manufacture the Predator using existing space and capacity in the Javelin production facility.

The co-production agreement stands in contrast to previous U.S. military missile manufacturing operations and Defense Department regulation 4145.26M, which prohibits the joining of adjacent operating lines of one or more programs and has been intended to ensure the survivability of one or more lines in the case of an accident in the plant.

Lockheed Martin officials believe it is time for the Pentagon to develop a new safety standard that would allow the co-production of missiles in its plant. They feel strongly that they have developed a safe and reliable manufacturing process for Javelin and Predator that will save time and money.

Military officials share the optimism about the co-production effort. Daren Holderfield, an industrial specialist, at the Army's Aviation and Missile Command at Redstone Arsenal, Ala., said he believes that "co-production is going to be a reality in the future of the defense industry. Sharing facilities and co-production efforts are already underway at the sub-assembly levels and initiatives such as the combined guidance system manufacturing at Lockheed Martin's plant in Ocala, Fla., are already achieving significant cost savings. The next step in this effort is to accomplish final missile assembly in a co-production environment."

The Javelin and Predator are similar weapons from the family of small, hand-launched, anti-armor missiles and are a natural fit for co-production. The Javelin has been produced since 1995 and more than 5,000 missiles have been delivered to the Army. In addition, the plant has contracts to produce an additional 11,000 Javelins, and there is potential for future production of 30,000 more weapons.

The Javelin is shoulder-fired and weighs 22.3 kg. The weapon uses an advanced infrared seeker and a fire-and-forget guidance system. It has been sold in small quantities to some U.S. allies.

For the production of Predator for the Marine Corps, Lockheed Martin is negotiating a contract for 385 missiles, but there is potential to eventually manufacture up to 50,000 weapons for Marines and allies.

Although the two products have no common parts, they are similar enough to allow the use of common flexible tooling on the manufacturing line. Several Javelin test stations will be used as multiple test stations, capable of testing both missiles. The Predator and Javelin will use the same missile assembly conveyors and transport carts, as they move through the manufacturing line, and they will share the walk-in ovens and racks used to speed the curing process on the missiles.

There is a common paint station, weigh station and container station for the packaging of the final missile. The same labor force, already manufacturing the Javelin, will assemble the Predator.

This co-production process was tested and improved in an actual demonstration, in which 12 Predator missiles were manufactured in the Javelin facility in the summer of 2000. The Troy plant had to modify its production layout to conduct this demonstration, which was observed by Lockheed Martin and U.S. military officials. During this demonstration, the Troy plant was not only able to verify the process for assembling Predator, but also was able to analyze the potential risks posed by producing two missiles in the same facility.

According to Mike Woodson, Predator project officer at the Marine Corps Systems Command, the plant "has met the standards of Marine Corps safety officials and every thing is on track for the co-production of the Predator and Javelin systems."

Much of the evaluation of the operation has hinged around Lockheed Martin's ability to safely achieve high quality standards for both missiles in the same manufacturing plant. In an evaluation of the 2000 production demonstration, Lockheed Martin evaluated risks associated with conducting the wrong test on a component, curing components at the wrong temperature, interchanging components between the two weapons and using the wrong paint on a weapon.

They sought ways to mitigate the risks of a mistake. For example, the plant decided to dedicate curing ovens to each weapon to prevent curing a weapon at the wrong temperature. In addition, they were able to identify that the hardware configurations and packaging configurations of the two missiles were different enough to prevent installation of a component in the wrong missile.

Lockheed Martin will use color-coding in the storage areas and on the assembly lines to physically separate the two products as they flow through the assembly process.

Obtaining approval for the co-production required two steps. First, the Defense Contracting Management Activity (DCMA) granted a co-production waiver for the Predator and Javelin programs after stringent review by safety officials last year. Second, a formal request to change rule 4145.26M was submitted to the Defense Department Explosive Safety Board (DDESB) in July. Final approval was expected in early 2001.

Changes in the regulation will open the door for more munitions co-production efforts in the future. In the meantime, the Javelin and Predator co-production will continue under the waiver.

Lockheed Martin plans to complete facility and production line changeover to accommodate the two missiles this month. The engineering manufacturing and development phase for Predator is scheduled for completion by the end of 2001. Once this milestone is reached, full-scale co-production would begin in 2002.

The initial quantities of Predator in 2002 will be quite small compared to the number of Javelins manufactured. But as the number of Javelin orders under current contracts decreases in future years, the manufacturing capacity will be used for the growing requirement for the Predator.

Col. John Weinzettle, project manager for Javelin at Redstone Arsenal, said, "The co-production effort, in theory, also will reduce costs for the Javelin program since overhead costs will not inflate the unit cost of the Javelin as production quantities are decreased in future years. Instead, overhead costs in the manufacturing facility will be offset by an increasing number of Predator missiles being assembled on the same production line."

The co-production effort is expected to save Lockheed Martin and the U.S. government $7.1 million in overhead and related costs. The savings are achieved by reducing overhead expenses--utility costs by $4.2 million and government oversight by $500,000. Also, the effort will reduce sup port costs by $2.1 million, direct tooling by $100,000 and remote communication equipment by $200,000. In addition to these direct savings, the company will avoid paying $4.4 million, which is what it would have cost to build and equip a separate manufacturing facility for Predator, if co-production had not been approved.

Capt. John E. Bell is a doctoral graduate student at the Air Force Institute of Technology Civilian Institutions Program Department of Management, Auburn University, Ala. The article was cleared for public release by the U.S. Air Force.